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Part IV: Onshoring and Offshoring in the Context of Legal Outsourcing: Cost

June 14, 2011

There is no doubt that costs on large projects can be minimized by utilizing overseas legal outsourcing companies.  The July/August 2008 ABA Law Practice Magazine reports that document review that costs $7 to $10 a page in the U.S. costs only $1 a page if sent to India.  The same article reports on a firm that pays under $10 an hour to have overseas Indian attorneys review litigation emails.  Another firm reports paying $12 an hour for work by an overseas Indian attorney.  These are well beyond rockbottom rates.

Meanwhile, the cost to hire a lawyer through a temp agency for in-house assistance ranges in the neighborhood of $40-60 per hour, depending on whether the lawyer is barred, and the work to be performed.  This is generally the figure for document review work, when the firm is hiring a small fleet of temp lawyers, who are paid after the agency takes a cut.

Solo contract attorneys charge more than temp lawyers for a myriad of reasons, with fees ranging greatly from $50-150 an hour.

A reduced outsourcing rate does not necessarily mean an increased profit for the hiring firm.  The ethics opinions are consistent that the hiring firm may only bill cost plus a reasonable surcharge related to supervision and the outsourcing relationship.  Arguably, work from an overseas firm may require more supervision, though this is not inherently the case.

Solo and small firm attorneys should contact me by email or phone at 608-620-3529 to schedule a free consultation.

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