Why NewLaw is the Real Alternative

Law Squared is a NewLaw firm that gives back to the startup and entrepreneur community by sharing legal knowledge and value through blog articles, ebooks, and recordings.

By Demetrio Zema, Founder & Director


On a Thursday night in early August I was on the train home around 7pm.

The train was busy but subdued, except for a particularly loud conversation taking place between two young lawyers. I tuned in.


According to one of the lawyers, this week between Monday and Thursday she had managed to “clock only 30 billable units”. She gloomily described how she’d had to email the partner explaining the underperformance of her weekly quota, and that she will be forced to allocate “a bunch of unbillable time” for the week.

This is traditional law (or what we will refer to as “OldLaw”).

I felt a twang of anxiety. Having worked in a similar environment for years, I know too well the weekly, monthly and annual billable targets and the pressures they place on employees.

And time billing is only the tip of the OldLaw iceberg. Rigid hierarchy. Long hours. Inflexible work arrangements. Stress. The list continues.

Frankly, it’s sad to know that lawyers are still subjected to this ailing model. (Note: I was actually shocked to see these lawyers out of the office so early!).

Are these the characteristics that you or your business would look for when engaging a law firm?

I would hope not.

But here’s the good news: there are alternatives, and they are taking the industry by storm.  


OldLaw’s competing priorities

Traditional law firms are notorious for setting budget expectations and financial projections based on the income to be generated by its employees. Just like the young lawyer on the train, employees are set strict budget expectations which is often around 3 to 5 times the employee’s wage and is reflective of the employee’s hourly charge out rate.

OldLaw’s maintenance of these archaic time budgets is representative of a more pervasive problem. OldLaw firms are fundamentally at odds with competing prioritiesbetween firms (i.e. income) and clients (i.e. effective outcomes), preferring the former and disenfranchising the latter.

The result? OldLaw models preference mediocre work and client satisfaction levels of ‘it got the job done’, so long as the money keeps flowing.

Innovation is impliedly discouraged, and effectiveness is penalised. The true potential of employees is disregarded in the name of profit.


The NewLaw revolution

The continued stagnancy of the legal sector has left it ripe for disruption. While traditional law firms continue to control a large portion of the industry, several new Australian firms championing NewLaw principles and philosophies are starting to captivate clients and lawyers alike.

NewLaw firms incorporate elements of traditional law firm models that aren’t at odds with today’s tech-driven world. Instead of focussing on billable hours, and holding employees accountable by strict time and financial budgets, NewLaw firms focus on client outcomes and creating value.

NewLaw creates a win-win-win scenario.

Clients win, because they are placed at the centre of the professional relationship, and can expect to be extremely satisfied with the work produced or service provided.

Employees win, because they are not faced with the pressures of hitting time budgets set by distant partners, and because work-life balance is encouraged through dispersed and flexible work arrangements.

And, by way of positive flow-on effect, NewLaw firms win, because employees are motivated and positive client relationships are fostered, resulting in the rapid production of high-quality legal work. All of this is underpinned by a devotion to innovation, pushing NewLaw firms to find unique modern solutions to recurring legal issues.

NewLaw endorses a shift of focus from profit to outcome, ultimately allowing for greater productivity, higher employee satisfaction and greater client outcomes. All employees understand and expect to be held accountable, however, this accountability should not be confined to restrictive time and financial budgets.


The choice is yours

Next time you need a lawyer, which model will you engage with? Do you think that OldLaw firms are out of touch with the needs of modern business?


At Law Squared, we partner with passionate entrepreneurs and businesses who need our technical help and expertise. We’d love to have a chat with you, so feel free to drop us an email hello@lawsquared.co


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