How is in-house practice different from a law firm?

Wednesday Oct 29, 2008

Law students frequently ask how in-house practice differs from working at a law firm. Although there are many differences, here are some of the main ones:

No billable hours.

As a law student, you may not yet appreciate the benefit of not having to account for every 6 minutes (1/10th of an hour) of your working day. Not having to do time sheets and mark down every 6 minutes sets you free! No more feeling guilty about going to the restroom or getting a drink of water! You can focus on doing good work instead of billing time.

Quality of life.

Many students have the mistaken impression that in-house counsel have cushy jobs with banker's hours. Not true. Yes, we may have more flexibility in when, how, and where we work (especially at Sun with our Open Work program) and we may have more evenings and weekends free. However, we work hard, and I don't know anyone who works in-house who leaves at 5 everyday. Maybe government jobs?

Diversity of Work.

Because in-house counsel only have one client (the company they work for), they may have less diversity of work than you'd get at a firm. When I was practicing at a large law firm, I got to work with all sorts of fun clients like video game developers, rock stars, book publishing companies, Internet start-up companies, clothing companies, financial services companies, medical device makers, golf course designers, and others. You'd never get this type of variety as an in-house attorney. That being said, at Sun you can get a lot of work diversity because of the number of products and business units we have - we have software (proprietary and open source), storage (tape and disk), servers (x64 and SPARC), and services (support, professional, managed, educational). Many companies would just have one of these business units - not all of them. And we have rock stars of a different type – they're just more geeky, like James Gosling ("Father of Java").

Compensation structure.

The compensation structure at a company is much different than at a law firm. At a firm, you generally get a higher salary with a bonus at the end of the year based, at least in part, on your billable hours. With an in-house position, you might get a smaller salary, but then you are generally eligible for quarterly bonuses, restricted stock units or options, 401(k), ESPP – which enable you to share more in the growth of the company. At a law firm, generally only the partners get to share in the upside growth of the firm. At a company, most everyone gets to share in the upside.

Knowledge of/involvement in business.

Because you have one client as in-house counsel, you become very familiar with the business and the products/services of your company, and you can understand how your job and particular deals/projects fit into the big picture. You eat, live, and sleep the goals and objectives of your company. You have depth of knowledge of your company's business and products, its industry, and its competitors. No more practicing law in a vacuum - you get lots of business context! You get to work on deals from start to finish, rather than having a client just throw you something at the last minute and ask you to spend no more than 1 hour reviewing it for any “gotchas.” You get great depth of knowledge (quality) rather than knowing a little about a lot of different things (quantity).

Growth opportunities.

As an example, there are plenty of growth opportunities at Sun, and rotations from group to group within our legal department are encouraged. When I first started at Sun, I was in the Global Sales legal group, where I negotiated outbound OEM software deals (for products like Java, Solaris, and StarOffice). After 4+ years in that group, I worked in the Marketing & Brands group (where I did a variety of trademark work and marketing deals for 2+ years), and now I'm in the Products & Technology Law group (where I do inbound technology licensing deals). In our legal department, we don't want people to be pigeonholed or stagnant and in the same job for 10 years. On the other hand, at many law firms you are required to stay within a single group, because the law firm doesn't want to have to invest more time training an associate, and starting over in a different area could adversely affect the associate's billing rate while their salary remains the same. Many times associates will change firms if they want to do something different because that's the only way to accomplish it.

Company resources aren't centered around the legal department.

Everything in a law firm is centered around the attorney – resources, admins, the whole business, because attorneys generate the revenue. Not so for in-house counsel – we are part of the overhead. The company needs to develop and sell products in order to be profitable, and the legal department needs to facilitate and enable that, not get in the way. It's not all about us. Sometimes it's hard for attorneys from firms who go in-house to adjust to this - you won't have your own admin, word processing open 24 hours a day, redlining tools designed for lawyers, dinner served every night at 7 pm, etc. Flexibility and patience are good qualities to have as an in-house attorney.

In smaller companies, you can be more isolated from legal colleagues.

In-house counsel at smaller companies (where they may be the only lawyer) may feel isolated. They may not be able to walk down the hall and talk to other legal colleagues and brainstorm. In these cases it's even more crucial to network! Join organizations like ACC where you can get to know other attorneys who may be in the same boat and who you may be able to leverage.

Business partnering.

Sun's in-house counsel is generally viewed as the "trusted advisor" - and part of the team rather than a checkpoint (or worse yet, a hurdle) at the end of the process. At Sun, being a business partner is an integral part of the in-house counsel role, and we work with clients to help them accomplish their business objectives. At law firms, generally only partners and senior associates get to fill the business partner role with clients.