Alternative Business Structures

Although not an immediately current issue this is still an interview favourite and might be overlooked today in favour of more topical issues such as Brexit. I would not skip preparing these sort of issues as it feeds directly into commercial awareness and industry knowledge.

An ABS is a firm where a non-lawyer:

  • is a manager of the firm, or
  • has an ownership-type interest in the firm

A firm may also be an ABS where another body:

  • is a manager of the firm, or
  • has an ownership-type interest in the firm

and at least 10 per cent of that body is controlled by non-lawyers.

(A non-lawyer is a person who is not authorised under the Legal Services Act 2007 to carry out reserved legal activities).

What the Law society has to say :


In my training contract interview I was asked whether I thought ABS’s would have a impact on my generation of legal professionals and whether this was a positive or negative impact?

My answer was honest and to the point, despite numerous challenges that ABS’s present in terms of work quantity. I do not believe you can replace solid legal personalised advice and client-facing interaction with a quick fix. Therefore, quality over quantity in an area such as law should stand the test of time.

Changes to the legal industry are not going away and in order to survive and hopefully evolve, law firms have to continue to move with these changes and not to ignore modern developments. There must be room for innovation and so long as a functional balance is found between traditional values and modernity and equilibrium will be reached.

The reality of alternative business structures (such as the Co-Op) means cut-throat competition in an already spirited industry. Recognition that an associate can no longer rest on their laurels by being a good associate – trainees and associates alike are expected to start bringing in clients at an early stage of their legal careers. This is especially relevant at smaller sized firms.

The negative impact will be most visibly felt at smaller law firms and high street firms. This is because larger firms can afford to compete with the level of branding, marketing and technology that ABS’s have at their disposal. For example, Admiral Law, BT Law, Co-op Legal Services, and Irwin Mitchell are already leveraging their corporate reputations to secure business and clients in high-volume transactional aspects of legal services, such as wills, probate, conveyancing, property valuations,employment law and personal injury.

New legal and business models means the legal environment is being forced to offer new alternatives while educating their employees in the new ways of legal work. Traditionally, lawyers billed every six minutes of their time- time being money. However, today with the installation of ABS’s, clients are in an ever increasingly powerful position and are negotiating bespoke pricing models from the outset with fix fees and retainers becoming an option. Law firms are under pressure to provide more certainty about the end price of each case and this carries profitability risk. The key to success is being able to retain clients, bring in high quality work and brand reputation.

Only time will tell… What the future holds?