The Firm

As we reported previously in the WoE (Not Just a Power Failure - 4/2003 No. 67) many heads of large companies in the U.S.A. (such as Martha Stewart and Dennis Kozlowski) are spending a huge amount of money on lawyers and legal costs at the moment, defending themselves against charges of financial dishonesty. This is bad news for the bosses, but very good news for the legal people. In fact, America is full of lawyers, it seems, all making a fast buck. Mike Majewski, who works in the legal profession in the U.S., explains how to get into this very lucrative business.

The beltway in Washington D.C., commonly known as a ring road in the rest of the world, demarcates the surrounding residential areas from the business and political interior of the American nation's capital. Like in most large U.S. cities, there are lots of lawyers. In Washington D.C., however, there are more lawyers than in most cities anywhere in the world! In fact, I have yet to eat at any Washington D.C. restaurant and not hear some discussion concerning something about law. That's how many lawyers are in this town!

Becoming a lawyer in the U.S. is different than in most countries. First, law is not a subject of study (other than select courses) at college and university level. Students pursue other related subjects upon entering a college, such as English, philosophy, social studies or history, for example. Only upon completing a four-year college or university program (Bachelor's Degree), can a student apply to do a three-year law school program, for a Juris Doctor Degree.

Then, upon completing the three-year law degree, a student can apply and sit for the Bar Examination in a given state, the passage of which grants the license to practice law in that state. Licenses for lawyers are regulated by individual states, and many states require passing their own examinations in order to work as a lawyer in that state. Incidentally, the words "lawyer" and "attorney" are used interchangeably in the U.S., and have essentially the same meaning. Upon sitting for the bar exam, a young lawyer may join a law firm, even if the exam results are not yet available, which can take up to 6 months. Needless to say, practicing law in Washington D.C. is a major draw for many young attorneys throughout the U.S. The past few years have seen dramatic increases in starting salaries for new attorneys, with lawyers "fresh out of school" often earning more than very senior judges in many cities! 60-hour-week plus

These new lawyers have not picked an easy way of making a living, however. The hours worked by new attorneys are often staggering, with "billable hours" starting at 2100 minimum hours annually in most Washington D.C. law firms. Some new attorneys, who have titles of "associates", can bill as much as 2500 hours annually. The actual hours worked are often around 20% more than billable hours, which amounts into average work weeks of at least 60-65 hours, and some attorneys work considerably more in large firms! It is not unusual to work overnight a few times per month. The toughest job I have done since working in the U.S. as a lawyer was a record four non-stop days of negotiations. Consequently, the offices of law firms contain many necessary amenities, including showers, kitchens, and couches for those rare and very brief naps!

Attorneys are kept interested in their careers with a particular law firm by the promise of a "partner" position i.e. of being provided with a partnership share in the law office. Lawyers are expected to practice law for 8 to 14 years, on average, before being considered for partnership. The criteria for becoming a partner varies widely between law firms, as does the meaning of what a "partner" position means. In some law firms, a "partner" does not mean a co-owner of a law office, but instead only entitles a partner to a share in the profits, with no guarantee of future employment or high salaries if business becomes weak.

Like many things in Washington D.C., the stakes for lawyers are high, and there is an extra amount of intensity in work life when "inside the beltway". Just like in politics and diplomacy, mistakes in law in Washington D.C. can be very costly, and this risk helps to explain, in part, the difficult job and high salaries that lawyers have there. But for a young lawyer, with possible debts from student loans, being a lawyer in high-pressured Washington D.C. or other large city can be a very good start, however unpredictable it may be.

Legal costs in the U.S.

If you want justice in the United Sates then be prepared to pay (loads) for it. Rates for legal fees vary based on location, experience of the lawyer and the nature of the matter. Believe it or not, rates may vary anywhere from $50 an hour to a $1,000 an hour or more. In rural areas and small towns, lawyers tend to charge less, and fees in the range of $100 to $200 an hour for an experienced attorney are probably the norm. In major metropolitan areas, the norm is probably closer to $200 to $400 an hour. Lawyers with expertise in specialized areas may charge much more.

In addition, you can expect to be charged at an hourly rate for paralegals and other support staff. A good paralegal's time may be billed out at $50 to a $100 an hour or perhaps more. It would not be unusual for a legal secretary's time, for example, to be billed out at perhaps $25 to $50 an hour.

Of course, the lawyers that Martha Stewart uses, for instance, will be high-profile, and "top of the range". So multiply all figures above by 10, and then add to that the costs of the court (which, as a guilty person, Stewart must pay) and you will arrive at her legal costs.