Law firms face a constant challenge: managing growing caseloads without increasing operational costs or compromising service quality. Large litigation matters, extensive document volumes and tight deadlines can put considerable pressure on in-house teams. Hiring permanent employees to manage fluctuating workloads is not always practical.
This has made legal process outsourcing (LPO) and legal process offshoring important options for law firms seeking additional support. Both approaches allow firms to delegate defined legal support activities, access specialist skills and manage workloads more effectively.
However, outsourcing and offshoring are not the same. Understanding their differences, available delivery models, benefits and risks helps firms make informed decisions about external legal support.
What Is Legal Process Outsourcing (LPO)?
Legal process outsourcing is the practice of having an external provider carry out certain legal or legal support functions for a law firm or corporate legal department.
Rather than do it all in house, firms can outsource certain activities such as document review, legal research, contract administration and litigation support.
For instance a large commercial dispute might see a law firm needing additional hands to go through thousands of emails, contracts and the like. An LPO can provide the appropriate people to assist with the review in accordance with the firm’s own processes.
The structure can be project based or ongoing depending on the requirements of the company.
Importantly outsourcing doesn’t pass on the professional legal responsibility. The law firm remains in full control of the legal strategy, client management, supervision and any decisions which require professional judgement.
What Is Legal Process Offshoring?
Legal process offshoring is about having your legal support functions carried out by people based in another country.
For instance a US law firm might work with a legal support team in India on document review, legal research or the like.
Firms use offshore legal services for access to skilled people, for additional capacity, for specialist skills and for operational flexibility. The time difference can also be of benefit in terms of being able to work across different working hours.
The distinction is simple:
- Outsourcing: describes who does the work. An external provider carries out the agreed activities.
- Offshoring: describes where the work is actually performed. The activity is performed in another country.
A firm can outsource to a domestic provider or an offshore provider. It could also set up its own overseas operation without outsourcing to an independent provider.
For law firms looking at legal process offshoring, you need to consider confidentiality, data protection, supervision and the cross border issues before you start.
What Are the Different Methods of Legal Process Outsourcing?
The correct engagement model will depend on the firm’s workload, the length of the project and the level of support required.
Project-Based Legal Outsourcing
A company will engage an external provider for a particular piece of work with a defined scope and a set of expected deliverables.
Examples being litigation document review, contract review backlogs and investigation support.
This model is appropriate for periods of increased temporary workload where there would be no need to recruit on a permanent basis.
Dedicated Legal Support Teams
A dedicated team are on hand to provide the firm with ongoing support on a number of ongoing assignments.
Over time the team will get to know the internal processes, the review processes and the way we communicate. That will obviously lead to better coordination and less onboarding.
It’s very useful for organisations that have a consistent requirement foristent requirement for document review, rese.
Managed Legal Support Services
Under a managed services arrangement the provider manages the agreed workflows, staffing, quality checks, reporting and issue escalation.
This is the model for the firm that wants a structured delivery rather than managing individual external resources.
Offshore Legal Support Model
Legal support is carried out by professionals in another country under this model.
The setup could be a dedicated team, it could be project resources or it could be a managed service. The degree of operational control will be dictated by the nature of the engagement.
Firms should assess the provider’s expertise, security controls, communication processes and ability to deliver consistently.
What Legal Services Can Be Outsourced or Offshored?
The breadth of LPO services will obviously vary according to the capabilities of the provider and the requirements of the particular engagement.
Commonly outsourced activities include:
Managed Document Review
Managed document review involves examining emails, contracts, messages and other records against agreed review criteria.
External teams may assist with relevance assessment, document categorisation, privilege identification and quality control. Supervising counsel remains responsible for legal decisions and review protocols.
eDiscovery and Litigation Support
eDiscovery covers the identification, collection, processing, review and production of electronically stored information (ESI).
External providers can provide support with data assessment, document processing, review workflows and the like in litigation. This is particularly the case in matters which involve large volumes of data.
Legal Research and Drafting Support
External legal professionals can help with case law research, jurisdictional analysis, legal summaries, checking of citations and the preparation of documents.
The supervising lawyers are still responsible for validating the research and for approving the documents for use.
Contract Lifecycle Management
Support can include contract abstraction, obligation tracking, document management, version control and contract administration.
These activities assist the legal team in keeping accurate records of contracts and in the management of ongoing obligations.
Cyber Incident Response and Data Breach Review
Following a cyber incident the legal team may be in a position where they need to go through a very large volume of records in order to identify the information that has been affected.
External support teams can help with the document review, identification of potentially exposed personal information, data classification and the preparation of findings for legal assessment.
Not all LPO providers will offer all of these services. It’s absolutely essential that you check the provider’s actual capability before you assign any work to them.
What Are the Benefits of Legal Process Outsourcing and Offshoring?
Legal outsourcing can be of considerable help in enabling firms to deal with the operational issues they face without necessarily having to expand every single internal function.
Better Control Over Operational Costs
External support can reduce the requirement to recruit in permanent staff to deal with temporary increases in workload.
Firms should still look at the total engagement cost (including provider fees, supervision, technology and QA).
Access to Additional Legal Support Capacity
Large litigation matters and investigations can see a sudden spike in the volume of documents. External teams are brought in to provide the additional resources to deal with those assignments.
More Time for Core Legal Responsibilities
Delegating the appropriate support functions enables the lawyers to focus on the actual legal strategy, the negotiations, the client interface and the more complex decisions.
Access to Specialist Skills
Specialist providers can of course provide professionals in the areas of eDiscovery, managed document review, litigation support and contract administration.
Firms can get access to these capabilities without having to build every function in house.
Flexible Engagement Models
Project based work, dedicated teams and managed services all allow the company to pick the level of support they require in line with their own workload and operational needs.
What Are The Risks Of Legal Process Outsourcing?
Outsourcing and offshoring need to be properly managed. You have to understand the risks involved before you start sharing client information or outsourcing any legal support work.
Confidentiality and data protection: legal records may contain privileged communications, personal data and commercially sensitive information. The firm must determine who can access the information, how it is to be dealt with and whether client consent or some other form of protection is required.
Cybersecurity: the provider should have appropriate access controls, encryption, confidentiality agreements, incident reporting procedures and secure data handling practices.
Quality and accuracy: Incomplete instructions and inconsistent review standards can have an impact on the end deliverable. Clear instructions, clear review protocols, training of reviewers, sampling and escalation procedures all go a long way to ensuring quality.
Cross border compliance: legal offshoring can involve international data transfers and different professional requirements. You’ll need to look at the applicable privacy laws, the client agreements and the professional conduct rules.
Communication issues: time zone differences and ambiguous instructions can all contribute to delays. Having clearly defined reporting schedules, points of contact and escalation paths helps with coordination.
Provider dependency: if you’re overly reliant on a single provider then you create continuity issues. You need to have documentation, knowledge transfer and exit arrangements in place.
The ABA’s Formal Opinion 08-451 is a useful guide for US lawyers on their duties in respect of the outsourcing of both legal and non-legal support services. It reiterates the need for competence, confidentiality and appropriate supervision. The relevant obligations will of course vary by jurisdiction.
How to Choose the Right Legal Process Outsourcing Partner
Price should not be the sole factor in the evaluation of legal outsourcing companies. You need to look at the provider’s delivery capability and their ability to deal with sensitive work.
Key evaluation criteria include:
- Relevant experience: Experience of the type you’d have in dealing with similar matters and similar workflows.
- Qualified people: appropriate training and experience of the services in question.
- Information security: Documented confidentiality and data protection practices.
- Quality assurance: Defined review procedures, supervision and escalation.
- Communication: clear reporting, accountability and regular updates.
- Transparent pricing: clearly defined scope, fees and responsibilities.
- Scalability: ability to cope with changing workloads.
- Continuity: Documented processes and arrangements for knowledge transfer.
A pilot project is a real way of testing out the quality of work, the quality of communication and the degree of operational compatibility prior to embarking on a much larger engagement.
What Is the Future of Legal Process Outsourcing?
The future of legal outsourcing is going to be about technology, specialist skills and the changing nature of what law firms want.
Greater Use of AI in Legal Workflows
AI is increasingly being used to support document classification, predictive coding, information extraction and technology assisted review.
These tools can be of immense assistance to legal teams in the identification of relevant information within large datasets. The catch of course is that AI output still needs to be checked by a human, especially in the case of privileged or sensitive information.
Growing Demand for Specialised Support
As legal workflows get more complex firms are likely to find themselves looking to a provider with specialist expertise in eDiscovery, managed document review, litigation support and data breach response.
More Flexible Delivery Models
Firms are likely to continue to assess project based support, dedicated teams and managed services on the basis of workload and operational requirements.
Greater Focus on Security and Accountability
As more of the legal work is being done via external teams and via technology platforms, the providers will need strong access controls, clear reporting and well defined responsibilities.
The focus will be on the integration of technology, skilled professionals and sound processes rather than on automation as a substitute for legal skills.
Why Consider Aeren LPO for Legal Process Offshoring?
Choosing an offshore partner is more than just having access to some extra people. You need a provider who understands legal working practices, the nature of document intensive work and the paramount importance of confidentiality and quality.
Aeren LPO provides support to law firms and legal teams via a range of services including eDiscovery, managed document review, litigation support and contract lifecycle management.
Its managed document review capabilities include AI powered prioritisation, technology assisted review and structured quality control. These workflows are designed to support firms who are dealing with large volumes of documents and have very demanding review requirements.
Aeren also provides legal research and litigation drafting support to legal teams (helping with jurisdictional research and litigation drafting).
For firms looking at legal process offshoring Aeren provides an opportunity to access further support without losing control of the legal strategy, the client relationships and the professional responsibilities.
Look at Aeren LPO’s eDiscovery services and their managed document review offering to see how they can support your legal operations.
If your firm is in a position where it needs further capacity for document intensive work or ongoing litigation support, get in touch with Aeren LPO to discuss your needs.
Conclusion
Legal process outsourcing and legal process offshoring give law firms practical ways to manage changing workloads, access specialist skills and extend their operational capacity.
The right arrangement depends on the firm’s requirements, the nature of the work, confidentiality obligations and the level of supervision needed.
With an experienced provider and clearly defined workflows, external legal support can become a reliable extension of a firm’s operations. Aeren LPO supports law firms through eDiscovery, managed document review and litigation support, helping them manage demanding assignments while keeping their core legal responsibilities in-house.
FAQ’s
Legal process outsourcing is the engagement of an external provider to carry out certain defined legal support functions. Legal process offshoring is the same thing but with the functions being performed in a different country. A firm can of course outsource locally as well as offshore. Offshoring can also involve the firm having an operation overseas.