In recent times, law firms such as Fenwick and Cooley have gained attention for their decision to defer incoming corporate and technology transactions until January 2024. This trend has sparked discussions among legal consultants and recruiters, who predict that more deferrals may follow in specific practice areas. While some view deferrals as a sensible business decision, others express concerns about the potential impact on new hires and the work environment. This article explores the reasons behind deferrals and the opinions surrounding their implications.
Deferrals as a Smart Business Decision:
According to legal consultants and recruiters interviewed by American Lawyer, firms like Fenwick and Cooley, known for their reputation, are setting an example for others to follow. These firms provide a justification for delaying inbound pursuits, particularly for those heavily engaged in technology sector-linked deal-making activities. The prevailing consensus among recruiters is that deferrals serve as a viable alternative to layoffs, offering firms more flexibility in uncertain times.
Retaining Talent and Building Experience:
In addition to being a pragmatic business move, deferrals can function as a talent retention mechanism. Recruiters acknowledge that by placing new hires on waiting lists, firms retain their top talent and afford current employees ample work opportunities to gain valuable experience. Jennifer Henderson, co-founder of legal search firm Hatch Henderson Fivel, describes such delays as “humane,” recognizing the futility of launching careers in an environment lacking sufficient work. Moreover, the option to recall deferred hires when demand improves remains open.
Potential Implications and Future Outlook:
While deferrals have their benefits, concerns remain about the impact on new hires and the overall work atmosphere. Recruiters warn that further deferrals may be imminent, particularly in specific practice areas that rely heavily on technology-related deal-making. However, opinions vary, with some recruiters emphasizing the practicality of deferrals and their potential to maintain a skilled workforce.
Call for Information:
As the trend of deferrals continues to shape the legal landscape, we invite readers to share any insights or information regarding their firms’ plans to implement major deferrals. Feel free to reach out to us via email or phone (646-820-8477). Your contributions will be greatly appreciated.
Conclusion:
The recent wave of deferrals in law firms, exemplified by Fenwick and Cooley, has prompted discussions about the advantages and potential drawbacks of this strategy. While viewed as a prudent business decision by many, concerns persist regarding the impact on new hires and the work environment. As the legal industry evolves, it remains to be seen how widespread deferrals will become and their long-term implications on both firms and employees.
