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March 2020

Mar 26, 2020

Law Firms Working Remotely During Covid-19

Question:

I am the sole owner of an estate planning firm in downtown Chicago with four other attorneys and six staff members. Since we are considered by the state of Illinois to be a necessary business service most of us are still working at the office. I know that many firms are working remotely. How is that working out and what are the specifics of how to make that work – new client intake meetings, work on client matters, coordination with attorney and staff team, and client document signings?

Response:

It is working out very well for many firms and better than expected. Here is what one of my estate planning law firms with four attorneys and seven staff members is doing:

The firm has the receptionist at each of its two offices working at each office.
The receptionist at each office answers the phones, makes appointments for new clients, and since the firm has landlines emails remote attorneys and staff their phone calls/messages who in turn return phone calls.
The receptionist at each office receives mail at the office, scans the mail, and emails to appropriate attorneys and staff. Incoming client documents are scanned to client files. Vendor invoices are scanned and emailed to the firm administrator who in turn updates the billing and bookkeeping systems.
The receptionist at each office makes remote bank deposits using the remote deposit scanner provided by the bank. A copy of the deposit report is emailed to the firm administrator who updates the billing and accounting systems.
All new client intake interviews are being done over the phone or via Skype, Zoom, or GoToMeeting.
Client document signings are being postponed or done at the office in a special sanitized room after clients are screened.
The firm has been paperless for some time and attorneys and staff are able to access form documents and client files remotely. GotoMyPC was setup on each attorney and staff member’s PC in the office and access is obtained to the firm’s server via GotoMyPC.
The firm administrator initiates the billing process by generating prebills in pdf and emailing to attorneys who in turn markup with comments on the pdf. The administrator makes changes, generates final invoices, email to clients that receive email invoices, and emails to the receptionist at each office who in turn mails to those clients that receive paper invoices.
Virtual team meetings are held weekly.
A new employee hired before Covid-19 will be trained virtually

This approach is working pretty well. The firm has sufficient work in process to keep people working and the firm, although new client calls are down, the phone is still ringing are the firm is signing up new business.

It would have been easier had the firm had cloud-based billing and accounting systems as well as VOIP phone system. However, the procedures and protocols the firm is taking is working reasonably well.

Personally, our firm went remote 20 years ago and we don’t miss the days of high office space cost, overhead, wasted commute time, etc. At that time I built out and dedicated 1,000 square feet of space in our home and we have all the systems (phones, file servers, conference room, etc.) that would be found in a typical office. We supplement this with a virtual arrangement with Regus.

Good Luck to all during this challenging time.

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John W. Olmstead, MBA, Ph.D, CMC

Mar 04, 2020

Law Firm Short-Term Succession Planning

Question:

I am the owner of a six lawyer business transnational law firm in South Florida. I have been practicing law for twelve years and I started my present practice nine years ago. I am 42 years old. The five attorneys that work for me are all associates of which two are very experienced seasoned lawyers and three have less than five years experience. Since I am still a young attorney I am not concerned about retirement or long-term succession planning, maybe I should be, but I am concerned about the short-term. What would the firm do if I got hit by a bus?

Response:

Your concern is the concern of many solo practitioners and sole owners of firms that have several associates but no equity partners. In fact many state bar associations are beginning to require attorneys in private practice to have written succession plans or in the very least a designated representative authorized to act on a limited and short term basis to protect the rights and interests of lawyers and lawyers’ clients in the event of an attorney’s death, disability, disappearance, practice abandonment, or any other similar event.

At the personal level a concern would be your personal income. If you are a major producer of revenue in the firm, which I assume you are, there would be a major impact on revenue and your personal income as well. Covering firm overhead would be an issue as well. Part of this can and should be covered with insurance. You might want to consider:

Long-term disability insurance
Short-term disability insurance
Overhead insurance
Key Person Life Insurance for yourself – can be used to help fund an internal buy-out if necessary. (Usually when there are other partners in a firm)

The second level of concern will be at the firm level, particularly if you were to become disabled either for an extended period or permanently or die. In this situation a key question would be whether or how the firm would sustain itself or even continue. Will the work continue to come in and who would do the work? If you have a firm administrator he or she would be there to manage the business-administrative side of the house but who (lawyer) would manage the client/project side (client service side) of the firm? This would generally fall to the other partners, but until such time as you have partners another attorney in the firm needs to be identified and groomed for such a role. If you decide that a non-equity partner tier is appropriate for your firm this role might fall to a non-equity partner until such time in the future that you have, if you have, other equity partners.

You would want a succession plan or what I call a practice continuation arrangement. A practice continuation arrangement is an arrangement – typically in the form of an agreement or contract -made between you and an attorney or attorneys in the firm or outside lawyer or law firm. The arrangement would describe a course of action to manage and cover and possibly transfer your practice and sets payment for its value. In the event of temporary or permanent disability, or death, a practice continuation arrangement protects the practice, the your business interests or your clients and your and your family’s financial interests.

Your plan should include records pertaining to client identity and financial records as well a list of passwords and other security protocols necessary to access the attorney’s electronic business files, calendar, and other law office related records in a location known and accessible by the attorney’s designated representative or office personnel.

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