Disruption brought by global uncertainty has pervaded the dynamics of the legal workforce, with lawyers across Asia rethinking a career outside the same old fish bowl. Freny Patel dives into the reasons behind this trend

In his alarmist “great resignation” speech in early 2022, Singapore Law Society president Adrian Tan lamented high attrition in the Lion City’s legal fraternity, alerting warning signals to the rest of Asia to rectify high attrition or face an exodus of talent.

Surprisingly, the pandemic was not to blame. Rather, the biggest challenge he saw was burnout, over which lawyers had been complaining way before 2020.

“Email and instant messaging mean that young lawyers operate at a far more intense pace, compared to previous generations,” he warned, highlighting mental well-being as a serious cause for concern.

His apprehension was subsequently, more recently, shared by India’s Chief Justice, Dhananjaya Yashwant Chandrachud, who equated junior lawyers to slave workers. At a Bar Council of India gathering, he said junior lawyers were overworked and underpaid, urging senior members of the bar to pay them decent salaries.

Although not sparking this trend becoming known as the “great resignation”, the pandemic surely added fuel to the fire, pushing many lawyers to adjust their working routines, roles, practice areas or even entire careers.

In tandem with these developments, say experts, is an urgent need for the region’s law firms to increase pay and improve working conditions if they wish to retain talent. As one lawyer who recently left private practice put it, there is a direct correlation between attrition rates and the empathy of leaders in how they treat their teams.

Many lawyers and legal recruitment agencies Asia Business Law Journal interviewed agree. There are various reasons for people movement in the legal fraternity. Hitting the glass ceiling, wanting a better work-life balance, lack of confidence in meeting billing targets, and wanting a more meaningful role in the corporate world are just some of the reasons why a new generation of lawyers are not necessarily at one firm for the long haul.

Rabindra Jhunjhunwala legal talentHan Ri Bong, a Seoul-based partner at Bae Kim & Lee, says the younger generation of lawyers has a different perspective from the older one, where staying at the one firm for decades until becoming partners was the norm.

He says the South Korean legal industry is different from what it was 30 years ago, when the market was small, with only about 300 lawyers passing the bar annually compared to thousands today.

The Wolters Kluwer Future Ready Lawyer Survey 2022 concurs that most legal organisations are not doing very well at delivering on the expectations of their workforce, warning that 70% of corporate lawyers are likely to leave their current positions in the next year.

Amid the pandemic, the Singapore market also saw a higher volume of mid-level associates leave their practices. This void in mid-level senior associates placed greater strain on very junior lawyers, who had to directly interact with partners, says Linus Choo, Singapore executive director at global recruitment agency Ethos BeathChapman.

But, pressed for time, partners could not support the junior lawyers to provide necessary guidance or support. There is always the pressure of deadlines when it comes to private practice service delivery, especially when it comes to arbitration, litigation or corporate transactions, Choo tells Asia Business Law Journal. “Resources being thin, and with this pressure to deliver, there is hardly time for hand-holding, and interaction reduces.”

The pandemic has been a game changer, forcing many lawyers to reset and reassess their working conditions, and leaving law firms across Asia grappling with high attrition rates.

Organisations that did not allow employees flexibility lost people to other firms, says Rabindra Jhunjhunwala, a Mumbai-based senior partner at Khaitan & Co. “Desperation defines one’s strategy to deal with a crisis, and giving flexibility is a strategy to retain people … allowing them to continue working from home.”

With increased flexible working and less face-to-face contact, the emotional connection between lawyer and law firm may not be as strong as it once was, meaning employees have been more inclined to move jobs, points out Geoff Allen, a partner at Trowers & Hamlins in Malaysia.

Perhaps understandably, litigation or arbitration have more stable teams than other practice areas, says Brian Chan, head of the Hong Kong legal practice at Ethos BeathChapman. There has not been a lot of movement in these teams, not even among law firms, because “lawyers engaged in dispute resolution have to attend court or arbitral proceedings that could take a year or two for trials to end”.

On the other hand, transactional practice is largely driven by the state of the capital market. When the market is hot, there’s a strong demand for equity or debt capital markets lawyers, says Chan. When the market contracts, there’s less demand for these lawyers, reflected by an annual attrition rate of 30%-40% for capital markets legal teams in private practice, and less than 20% for dispute resolution teams in Hong Kong, he says.

At the same time, most Asian markets have witnessed a high demand for data privacy and technology, media and telecommunication (TMT) lawyers. “Triggered by the pandemic, e-commerce has boomed, as has fintech, and there is a lot of demand for these lawyers as clients seek advice in these areas, especially given the rapid regulatory changes,” says Chan. He expects attrition to continue unless most law firms adopt hybrid working arrangements.

Alain Charles Veloso, a Manila-based partner at Quisumbing Torres, also expects attrition to continue and sees corporate and transactional lawyers moving in-house. Many lawyers in the Philippines are resigning to pursue further studies, join the government, move in-house or engage in other endeavours such as starting their own firm or business, says Veloso. “This is driven by lawyers having less appetite for a stressful and high-pressure work environment with long working hours, and striving for more work-life balance.”

Geoff Allen legal talentSingapore burnout

The reason for lawyers leaving last year could have been cumulative with work-related burnout due to Covid, says Choo at Ethos BeathChapman. The huge pressure on young lawyers working longer hours has forced many to leave and join in-house, or leave the legal practice altogether.

Choo says there is an enormous pressure of deadlines in private practice, especially in the case of arbitration or litigation work, or corporate transactions. He says every year there is also a steady decline in terms of the number of lawyers in Singapore, pointing to many more options available to them. “Many non-legal counsel roles increasingly prefer a legally trained professional,” he says.

Against the number of lawyers leaving, there is a fresh batch of 400 to 500 recruited every year in Singapore.

“If we are losing 30% of current practising lawyers, technically we would see fewer lawyers in practice in the long run unless we find some solutions to plug the gap,” says Choo.

At the same time, Singapore is attracting the entry of many new law firms such as Indian law firm Cyril Armachand Mangaldas, which opened its first overseas office in the city-state last year. Spanish law firm Pérez-Llorca has also announced plans to open a Singapore office in early 2023.

“It’s the perfect place to develop our strategy in the Asia-Pacific region,” says senior associate Pablo Hontoria, who is being promoted to partnership to head the operations. Hontoria sees Singapore as one of the three global financial capitals, the other two being New York and London, where the firm already has a presence.

He says it is “the best hub” from which to approach other countries in this region including China, Japan, Australia, South Korea, Malaysia, Indonesia, India, the Philippines and Vietnam.

Linus Choo legal talentHong Kong hub

Traditionally, Hong Kong was the city of choice for most international law firms establishing an Asian presence. But the market is evolving as firms diversify regionally, opening offices in Singapore, which explains some movement of lawyers from Hong Kong to Singapore, says Chan. “There is a two-way movement of lawyers as some are now returning to their home country, be it China, Singapore or even in Europe,” he adds.

Christopher Chu, a Hong Kong-based director at boutique legal recruitment agency Lewis Sanders, agrees there has been an uptick in lawyers repatriating or moving overseas from Hong Kong in the past two years.

“Covid-related restrictions in Hong Kong have resulted in candidates considering roles in other markets,” he says, although attrition among associates has not been significant enough to cause major concerns for law firms in Hong Kong.

“Unlike overseas, we have not seen signs of a ‘great resignation’ in this region’s legal industry,” says Chu. Rather, he says, given general market uncertainty in Hong Kong and overseas, associates have been more inclined to stay put unless they had specific reasons for moving.

Reasons for associate turnover have been similar to previous years, including looking for a step up in brand, retraining in other practice areas, more visible prospects, immediate partnership, better work-life balance, and in-house opportunities, says Chu. If money is the only motive, they are only willing to move for significant increases, he adds.

US law firms meanwhile tend to attract experienced associates from the Magic Circle of law firms or other international firms in Hong Kong by offering them salaries based on the Cravath scale, a lockstep associate compensation system based on the number of years out of law school, says Chan, at Ethos BeathChapman.

“The presence of US law firms tends to create higher attrition because their pay scale is more than most international law firms,” says Chan. And he adds that the pay scale is higher in Hong Kong than in Singapore or China. In the past, local salaries paid to lawyers from other parts of Asia, including Singapore and China, were 20% to 40% of Hong Kong, but the gap is closing as salaries in China and Singapore increase, he says.

Brian Chan legal talent

The exit of some US and UK law firms also explains Hong Kong’s high attrition in the past few years. US law firm Baker Botts shut down its Hong Kong office last year.

But the entry of PRC law firms has witnessed significant hiring. Seven of the eight Red Circle law firms are now present in the city, with the exception of the Global Law Office.

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