Scots legal hub bid could create hundreds of jobs

Group Business Correspondent

Wednesday 8 August 2012

The Law Society and Scottish Development International are teaming up to promote Scotland as a hub for the £512 million global legal support industry in a move that backers believe could create hundreds of jobs in the country.

OPTIMISM: Law Society of Scotland boss Lorna Jack said the plans will create further jobs. Picture: Steve Cox

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MARK WILLIAMSON

The organisations hope to persuade companies to use Scotland as a centre for the kind of legal process work that is being outsourced by law firms to low cost overseas bases in places like India and the Philippines.

They believe there is great potential to draw on the wealth of legal expertise in Scotland to duplicate the success of investment administration firms and other operations that provide back office support for financial services firms. These have brought work supporting fund managers and banks from around the world to Scotland.Legal process outsourcing involves law firms using third parties to complete the kind of standard work that is often completed by paralegals rather than qualified lawyers. For example, this can involve inputting transaction details on the standardised contracts issued by companies that have high sales volumes or searching the reams of documents that must be consulted in connection with some commercial deals.Neil Stevenson, director of representation and professional support at the Law Society of Scotland, said use of legal process outsourcing has been growing rapidly in response to the demands that clients are placing on law firms to increase efficiency.The practice is widespread in the USA and England. A number of Scottish firms outsource work outside the country.Mark McMullen, who heads the financial and business services team at Scottish Development International, said the global LPO market is now worth around $800m (£512m) a year. It has been growing at 26% annually.The Law Society and SDI believe the strength of the legal profession and the related education system in Scotland means the country is well placed to compete for work in this market.They believe firms based in places like London and New York could get work completed in Scotland at a fraction of what it would cost in those cities.Besides winning work from firms based outside Scotland, outsourcing specialists could persuade firms based in the country to keep work here.Lorna Jack, chief executive of the Law Society of Scotland, said: "The legal sector is a major employer in Scotland, providing around 20,000 jobs, including our 10,400 solicitor members, and contributing £1.2 billion to the Scottish economy and I would hope that encouraging organisations to outsource their legal process work here will boost that further."She added: "In addition to promoting our expertise to elsewhere in the UK and overseas, many of our larger law firms already outsource legal processing work to third party providers. This would give them increased choice and the opportunity to keep the work in Scotland in addition to generating job opportunities, both for qualified solicitors and for law graduates who aim to qualify as solicitors."The legal services market is currently undergoing huge change and it's important to make sure our members can benefit from new opportunities and that we promote what Scotland has to offer."Asked how many jobs might be created, Mr Stevenson said: "We are working on the basis that it's potentially in the hundreds."Mr McMullen noted that financial services giants like JP Morgan and Morgan Stanley have received support to create thousands of back office jobs in Scotland. Grants will be available for firms that open legal support service operations in Scotland.

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Scots legal hub bid could create hundreds of jobs

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