Current Trend To Outsource Legal Work Abroad and the Ethical Issues Related to Such Practices, The

Georgetown Journal of Legal Ethics, The, Summer 2006 by Kadzik, Alison M

Some law firms and legal departments take a slightly different approach to outsourcing. These organizations have chosen not to outsource their work but instead have decided to open branch offices abroad that are staffed by foreign employees, a practice known as "offshoring."24 The process of offshoring legal work results in similar cost-savings and efficiencies as outsourcing legal work. Both techniques pose the same ethical and legal considerations, including issues of conflicts of interest, confidentiality, lawyer supervision, and disclosure to clients that their work is being performed by employees abroad.

II. ETHICAL ISSUES RAISED BY OUTSOURCING LEGAL WORK

The attraction of cheap labor, cost-savings, and efficiency are not enough to convince some lawyers that the process of outsourcing legal work to other countries is a good idea.25 Some concerns raised by these skeptical lawyers are questions of security and confidentiality.26 For instance, if the hired outsource workers are "not licensed to practice law in the United States, U.S. ethics rules may not apply to the person, but would still apply to the lawyer who outsourced the work."27

One indisputable obstacle to the outsourcing of legal work is the strict requirements of the U.S. legal profession.28 These requirements "mandate that only lawyers who are licensed in the U.S. can give legal advice on American law."29 This requirement extremely limits foreign-educated and foreign-trained lawyers who are not licensed to practice in the U.S. in the type of legal work they can perform for U.S. firms.30

The outsourcing of legal work by U.S. law firms has been compared to the use of temporary lawyers by domestic law firms.31 The ABA addressed the ethical implications invoked by the use of temporary lawyers in Formal Opinion 88-356.32 In addressing the use of temporary lawyers, the ABA opinion concluded that the following ethical concerns were implicated:

(1) avoiding conflicts of interest, (2) maintaining confidentiality of information relating to the representation of clients, (3) disclosing to clients the arrangement between the lawyer and the firm in some circumstances, and (4) maintaining professional independence of the lawyer performing the work, from the non-law company to which the fee is paid.33

These same concerns arise with the outsourcing and offshoring of legal work. It is important that any firm outsourcing legal work to foreign-trained employees ensure that the above ethics rules are not violated.

A. CONFLICTSOFINTEREST

The conflict of interest rules as promulgated by the ABA seek to maintain a lawyer's loyalty and independent judgment in relation to each client. Model Rules 1.7, 1.8, and 1.9 outline the instances in which a lawyer is barred from representing both a former and current client and the lawyer's duties to former clients.34 The use of overseas workers through the process of outsourcing raises potential ethical issues in terms of conflicts of interest.

In order to ensure that the use of outsourcing and employing overseas workers does not create conflicts of interest for U.S. lawyers and law firms, it is important that all overseas employees are screened from all information relating to clients for which the overseas employee does no work.35 In addition, all law firms engaged in the practice of outsourcing legal work should maintain a complete and accurate record of all matters for which work is outsourced and the particular overseas employee who worked on each client matter.36