Legal Sector Overwhelmingly Unprepared For Brexit
The majority of law firms have failed to prepare for Brexit and do not prioritise it as an immediate concern despite the March 29 deadline just weeks away.
According to the most recent Bellwether Report Series – ‘The Luxury of Uncertainty’ – by Lexis Nexis, fewer than 1 in 10 law firms have put in a contingency plan to deal with potential Brexit implications.
Whilst a fifth of firms had planned for Brexit, only 9% of those surveyed had made a robust contingency plan for issues that may arise following March 29.
In fact, the research indicates that Brexit is at the bottom of a law firm’s to do list. For the majority, the reoccurring importance of staff and incorporating legal technology remain a fixed priority.
Overall, 77% of firms are considering taking on more legal service staff with 43% implementing these desires. Although 4% fewer firms were prioritising the increase in technology investment, it is still a consideration with 73% of firms and currently being implemented by 38%.
In part, this lack of anxiety around Brexit is reaffirmed by the 91% of firms that feel confident about the future, with 57% highlighting significant current growth within their firm. With 63% of expanding firms doing so organically and mergers/acquisitions decreasing by 4% to 13% when compared with 2018’s figures, the legal sector feels as though growth is sustainable and healthy.
When speculating to the future, 80% of firms believe they will either grow or remain secure over the next 5 years, this figure has increased by 2% from 2018’s figures.
The report also emphasises the overwhelming amount of UK-centric work (95%) within the legal sector that could account for a reduction in Brexit related anxiety. In contrast, only 21% of respondents have any legal involvement outside the UK.
Instead, 64% of those questioned, are at least ‘quite concerned’ with the new SRA code of conduct changes enabling non-legal businesses to sell the services of regulated and self-employed solicitors that will take effect in April. 58% would rather think of ways to retain their experienced staff and 56% are concerned with the increase in DIY legal services like probate and online Wills. As the market hardens, 53% are more concerned with renewing their personal indemnity insurance.
Should the legal sector and those providing legal services ensure that a robust contingency is in place for life after Brexit? Will Brexit significantly impact the legal sector this year?