Legal Limbo: The Impact of COVID-19 on American Law Firms
Just as it has on almost every other part of American society, the COVID-19 pandemic has had detrimental effects on the United States legal industry. With no clear end to the global crisis soon, America’s law firms are facing enormous challenges. While entire industries, such as the restaurant, entertainment, and travel sectors have been devastated, law firms across the country are struggling to continue to serve their clients while trying to avoid financial disaster.
Fortunately firms like Market My Market are helping law firms navigate this unforeseen territory during this time.
American law firms acted early, especially larger ones with international offices. Travel restrictions and bans to countries that were considered “hot spots” were immediately put in place. Once the pandemic spread to American shores and worsened– creating a public health and an economic crisis, law firms had to implement more drastic measures.
In an effort to maintain continuity and vitality, many law firms trimmed their staff. Support workers were affected by the cuts most. When state governments, in an effort to slow down the spread of the virus, began closing all nonessential businesses, law firms across the country were forced to shut down their offices.
Lawyers most negatively impacted by the COVID-19 pandemic are litigators and those working contingency cases. Essential activities like writing letters and briefs are still occurring. However, as long as courts and administrative offices remained closed, no hearings, depositions or trials can occur. Adding to the legal dilemma is the fact that, with courts closed, trials canceled, and the pandemic showing no signs of ending soon, many litigants no longer feel pressured to settle their cases. Contingency lawyers and their firms, who only collect their fees when cases are resolved, face increasing financial uncertainty the longer the COVID-19 pandemic continues.
Law firms specializing in business mergers and acquisitions have also been sidelined. Many of their clients are simply waiting for the pandemic and the economic crisis to pass before making any major business decisions.
However, in the midst of major peril and adversity, many law firms are striking back. Those experiencing considerable financial strain are pursuing efforts to have their credit lines extended by their banks. Law firms are utilizing innovative technological tools to continue to operate their businesses and serve their clients. Videoconferencing software is enabling the ability of law firms to have client meetings and lawyer conferences. Most lawyers are working remotely during the crisis.
Despite the disastrous impact of COVID-19 on the legal industry, some law firms are experiencing a surge in business. Insurance lawyers have been needed to define coverage exclusions with regard to risks. The advice of employment attorneys have been vital toward helping employers navigate the increasingly complex matters of employee safety and layoffs. With the dramatic expanse of businesses working remotely, attorneys skilled in cybersecurity’s legal matters are in demand. Interest in the three areas is expected to remain strong for the next 12 to 18 months. As a result of the financial crisis caused by COVID-19, bankruptcy attorneys are also expected to be in great demand in the coming weeks and months as well.
Ultimately, the United States and its industries are expected to recover from the effects of the COVID-19 pandemic. Many believe that the legal industry has been permanently transformed digitally by the crisis. It is expected that the industry will be deluged by both old and new cases once the pandemic is over and that the practices law firms adapted to get through the COVID-19 crisis– like working remotely and videoconferencing and even how they will do their marketing — are expected to continue to be used to help law firms adjust, adapt, and advance in a post-COVID-19 pandemic world.