Back up your data daily. No excuses! Limit your possible loss to a single day's work. Make sure you check your backups to make sure they are successful and that you periodically check to see that you can restore from the backup media, which can "go bad" over time.
Use off-site storage. "Warm" storage on site is fine, but make sure you have "cold" storage as well in case your disgruntled employee turns to arson, firebombing, etc.
Run virus protection software and get frequent updates. It is appalling how often we see law firms with anti-virus software--and the last update was a year or more ago. Better yet, make sure you upgrade to the new virus protection software packages that automatically get updates from the Net.
Limit employee access to information. Require use of passwords that are not easily guessed and require them to be changed periodically. These means combinations of alpha (multi-case) and numeric characters and/or symbols. No "Rover" or "birthdate" passwords! Don't use generic or default passwords for temporary employees. No "Guest" IDs and no "password" passwords!
Secure your equipment and your facilities. Turn workstations off at night unless they are utilized for remote access (walk up access should also be secured from local usage when unattended). Servers should be in a separate locked area and the area should remain locked during the day as well.
Monitor/filter and announce your intention to do so. Make it clear in your employee handbook that you have the right to electronically monitor employee use of your information systems, and that you own correspondence and other data generated on your system. Make it clear that employees should not be storing personal data on office computers. Make it clear that there is no reasonable expectation of privacy when it comes to firm e-mail, and that the firm has the right to access anything on its own system. Just because you have the right to snoop doesn't mean you have to do so. But spot-checking generally produces a sizeable harvest of policy violations. It seems as if, policy or no policy, the temptations of the Net are just too great. Consider whether to "filter" access to the Internet or whether to monitor employee usage of the Internet.
Safeguard use of your computer systems via modem by using a dial-back system for employee dial-ins. The system receives a call and then calls the employee back at a pre-approved phone number.
Terminate employees carefully. When it's necessary to discharge an employee who has access to critical company data, let them go without notice and don't allow them to return. Pack up their personal belongings beforehand or allow them to do so under supervision. Do NOT allow them access to a computer. Before you let employees go, remove their passwords, e-mail access, etc. If litigation is anticipated, consider collecting electronic evidence forensically and/or "retiring" the employee's computer.
What if you are victimized in spite of your best efforts? Check your insurance policy carefully to make sure you are covered. It is very unpleasant to find yourself the subject of an exclusion or to learn, after the fact, that there is a special policy or rider that you might have purchased but were unaware of. Cyberinsurance can cover much more than problems with disgruntled employees. It can cover losses from denial of service attacks, viruses, electronic embezzlement, damage or theft from outside hackers, and even copyright and privacy infringement. Cyberinsurance is such a burgeoning market that the Insurance Information Institute has predicted that it will be a $2.5 billion market by 2005. American International Group, one of the companies issuing cyberinsurance policies, has issued more than 2,000 policies thus far, but surveys of businesses in general indicate that they are unaware of the existence of cyberinsurance. The cost varies widely as does the amount of coverage available, in part because there is so little history of paying out claims, so no one knows quite what to charge to make the customary margin.
In the end, the best prophylactic is using the suggestions above and constant vigilance to make sure they are truly carried out. You must also update these suggestions as technology and threats to technology alter in form. The technological juggernaut has been a blessing in many respects, but the headlong rush to move to an electronic world has sometimes suffered from a shortsighted view of the risks involved. The moral of the story is that the quote in the beginning of this article is no empty threat. "They" really can cut your air supply--unless you work hard to take appropriate countermeasures. Only eternal vigilance really works--and even that only buys you a better shot at avoiding or surviving technological assaults.
_______________
The authors are the President and Vice President of Sensei Enterprises, Inc., a legal technology and computer forensics firm based in Fairfax, VA. 703-359-0700 (phone) (e-mail), (Web site).
Part-time employment--Does it work?
By Jeffrey A. Rouhandeh
Part-time Employment--does it work? Is this a rhetorical question? I want to go on record and state unequivocally, maybe. Let me be perfectly frank: I'm not in favor of part-time employment. To all intents and purposes lawyers are "service providers": they provide legal services to clients who generally work from 8:00 a.m. to 5:00 p.m., five days a week. For a lawyer to merit the first telephone call from a potential client and maintain his continued employment after retention, he generally has to log in the same number of hours for the same period of time as the client. Why? Because the client expects continuity from a professional in the legal arena: he expects that the lawyer who hears his complaint at the beginning of the relationship and subsequently provides him with legal direction actually works for him! He or she is "his lawyer" during regular business hours.
A part-time employee can't really provide the continuity that's an integral part of the law firm mechanism. He's more like a "cog" on one of the gears, and where can you find a person who's dedicated to being a cog? A couple of years ago there was a TV ad where children in deadpan voices said things like "I want to be a 'yes' man," "...a 'yes' woman;" "I want to file all day;" "I want to work long hours for little pay." Part-time employment translates to short hours with requisite pay and few benefits.
What constitutes part-time employment? The answer depends on whom you ask. If you ask the employer, part-time employment covers any time less than 40 hours. That means someone who works 35 hours a week works part-time. Is that comparable to someone who only works 20 hours a week? Now talk to the personnel/office manager whose job is to see that employee benefits are in-line with the part-time job description and the business bottom-line. Are there degrees of part-time employment? (Where's a handbook when you need one?) Do part-time employees get paid vacations after a prescribed period of employment like other full-time staff? If they don't, merely because they're "part-time," you're likely to see a revolving door of employees in that particular department. The personnel/office manager has to work in this conundrum with the employer and part-time employee throughout the business relationship.
Another question to ask is what defines part-time employment: the job or the hours? Does the employee have specific duties that don't require her full-time/daily presence in the law firm, i.e., the bookkeeper? If the job is clerical, does the part-time employee work as an assistant to a broader pool of full-time staff? If the part-time employee works for one or two lawyers, how does this assist the firm as a whole? If she works half a day for five days a week, which half of the day is best? Should she come in at 8:00 a.m. and work until noon? And what if the part-time employee is a lawyer? If he contacts a client in the morning, whom does he designate to answer the client's return call in the afternoon? Practically speaking, good business sense would discourage making a call to an anxious client and leaving the message on his answering machine that his lawyer is working on his case but is not there to take his call. Concerning that scenario, does the part-time lawyer arrange for someone else to take the call or does he leave a message for the client to "take two aspirin" and call him in the morning?
What if the part-time staff employee works in the afternoon? Who brings her "up to speed" on current events of the day? General information disbursement should be handled at a staff level but if the part-time employee works for a specific lawyer, does that lawyer have to designate a set time every day after lunch to "brief" the newly-arrived-on-the-scene employee? That's not an efficient or economically viable use of anyone's time. If you want to hire someone for two or three days a week, reread the preceding paragraphs for the viability of that option.
I've focused primarily on part-time employees in support/staff positions in law firms but I think it's important to address the viability of the part-time lawyer a little further. Take everything written thus far and factor in a client's frustration with litigation continuances or, for example, the hassle of scheduling and rescheduling discovery conferences. Then have someone else tell the client that his lawyer isn't available to take his call.
What if there's an emergency? Is there another lawyer who can answer the client's questions about his case or jump into the fray? Isn't it more likely that the lawyer who is "on call" and who responds to the client merely "tides the client over" until the time when his own lawyer can get back to him? Now the law firm has two calls invested in a client where one would suffice. While it's true that the lawyer 'on call' has spent time maintaining the status quo--that "continuity" I mentioned earlier--is this an efficient--forget economic--use of that lawyer's time? When and how often should the absent part-time lawyer's "emergency" take precedence and render his partner's own cases of secondary importance? On the other hand, if the lawyer were there, maybe it wouldn't be an emergency. Only that lawyer can tell.
In a large law firm perhaps part-time employment works because there are easily two or three lawyers or full-time staff employees to "cover." In a smaller law firm, each person, each "cog" must be present for the machine to run smoothly. If you're lucky and you have a side job "pulling rabbits out of hats," you can mix full-time staff with part-time staff, full-time lawyers with part-time lawyers and pat yourself on the back that you're effectively cutting operating costs--somewhere! The bottom line never looked so attainable! However, when you take a cog or gear out of the mechanism for a period of time each day, you find the other "cogs" perform some interesting adaptive feats to keep things running. Someone in the office will have to work a little harder, work a little longer and become more frustrated with the mechanism as a whole. I say 'as a whole' because this isn't a one-time-only occurrence: With a part-time staff or lawyer, the glitch in the mechanism will recur every time the employee or lawyer is off.
To be effective, a part-time staff employee's job should be clearly defined regardless of whether she has specific duties to a lawyer or whether she is to provide general assistance to other full-time staff. If the former, the part-time employee needs to know exactly what her specific duties are and make sure she completes them by the end of her shift. Then everyone else needs to respect the strictures of her duties and leave her alone. Time constraints will necessitate a certain amount of isolation. If the part-time staff employee is to provide general assistance, her duties are more flexible and she can be the extra cog that makes the mechanism run smoothly. A part-time employee, whether staff or lawyer, must be able to prioritize and work within the time constraints of her employment. Unless part-time employment is strictly defined, the benefits are more likely to be toward the employee than the employer.
In the final analysis, I think a lawyer is handicapped by part-time employment. The client expects continuity in the law firm he hires to represent him. Whether he wants an update or has an emergency, or just wants to pay his bill ("thank you, thank you"), he wants to talk to "his" lawyer or "his" lawyer's assistant. For law firms to be competitive, they can't forget that they're service providers in the old-fashioned sense. They don't make 'house calls,' but they do the next best thing: They're there. Okay, was this a trick question?
_______________
Jeffrey A. Rouhandeh is a partner at the law firm of Caldwell, Berner & Caldwell located on the Woodstock Square in McHenry County, Illinois since 1915. Mr.Rouhandeh's practice concentrates in the area of civil litigation.
By Donald E. Weihl
Law firms of all sizes represent large clients on a day-to-day, month-to-month, and year-to-year basis. Attorneys attracting large clients receive accolades from other firm attorneys because large clients bring large fees and growth potential for any size firm.
Nonetheless, large clients also bring large headaches to law firm management. The larger the representation is, the greater exposure there is for malpractice. Management can deal with this problem by increasing malpractice coverage limits; however, even higher limits will not solve all of the malpractice problems. The task of management is greater than being sure the coverage matches the risk. The greater element to be dealt with is supervising the work and providing attorneys with experience and skills that cause the engagement to be handled in a manner that keeps malpractice from occurring.
Malpractice is not the only challenge faced by management because of large clients. Monitoring what matters are being handled for clients also needs attention. This is often a very difficult issue because internal practices of clients are often not disclosed to attorneys handling the work, and the nondisclosure is, in many instances, intentional. Client problems ranging from mismanagement, poor business judgment, economic downturns, to outright executive fraud must all be considered. Even regulatory action by government agencies can be a client problem that brings down giant clients or even industry segments. As an example, the S & L industry collapse that began in the early 80s became a substantial problem for law firms with S & L practices. The management at few firms anticipated the losses that would be incurred by firms that relied on large blocks of S & L income to support the firms.
The solution to the problem of monitoring internal client practices requires law firm management to analyze the engagements being handled, but also to diversify the clients being represented to be sure that the failure of a client or group of clients does not risk the existence of the entire law firm.
Diversifying representations can be a further challenge because individual attorneys may change firms if large engagements are refused when the diversification takes place. Management's roll is to achieve the balance that deals with all of the issues in a manner that keeps the firm healthy.
Consider also the balance in lawyer compensation problem that management faces when a large client offers one or more firm lawyers an in-house position with the client that not only takes away the lawyer, but also the revenue the firm derived from billable hours that are lost.
The lawyer compensation problem is a further challenge because the individual lawyer with the large client in his book of business may change firms and take the client with him when greater compensation is offered by a competing firm. It goes without saying that lawyers expect greater compensation when their large clients contribute substantial revenue to firm coffers.
The compensation issue can also work in reverse when a large client changes firms. The loss of work can cause drastic changes in staffing needs so that multiple lawyers and support staff need to be let go when work to support them is no longer there. Additionally, the corresponding rent costs, computer costs, and furnishings costs have to be dealt with because these expenses continue until the vacant offices can be filled because of new business.
One item often overlooked when dealing with the large client is the timing of payments for the billable time, as well as the advances required to be made on behalf of the client. If a large client pays quarterly or less often than quarterly, the firm budget can become so distorted that financing costs must also be addressed by management.
Staffing for the work of large clients can also present problems that challenge the skills of management. For projects with a finite duration, it is possible to hire contract lawyers, part-time paralegals, and temporary help from agencies that have every possible skill to fill the short-term need. Even then, the quality of the help may necessitate greater training expense, higher labor costs because of overtime, and similar items. If the project will take several years before coming to an end, it may become necessary to convert good temporary help into full time help that will add costs for medical coverage, vacations, deferred benefit contributions, and similar items. At the end, when the converted-to-full-time employees are no longer needed, exit interviews, COBRA rights and similar details add additional expense to the project.
Management's estimates of the cost of staffing large projects are often not inclusive of sufficient overhead to make the project as profitable as initially anticipated, and in protracted litigation it may be totally impossible to accurately predict the cost of handling the work. It becomes counterproductive to overall firm profit to have a project become a loser, and the quality of the work done on a losing project may not be up to the usual high standards of the firm because of cost-cutting efforts to bring the project back to profitability.
Compounding the problem of not being able to accurately predict the cost of handling the work, the large client may have sufficient leverage on the firm to cause the project to be handled on a contingent-fee basis or on a fixed-cost basis. Either way, the large client may create pressures on management that result in decisions being made that would not have been made for smaller clients.
Ultimately, large clients can create reliance by firms on the substantial revenue they generate so that other demands are made that were not anticipated when the first large-client engagement was undertaken. Consider the pressure the client can put on a firm to make a substantial charitable contribution to assist the large client's support for a cause that may not be one the firm would ordinarily support, or in some cases that the firm would oppose.
As the title of this article suggests, the large client can be much more of a dilemma than a panacea. The issues presented in this article are not susceptible to easy solutions. The handling of each issue of necessity must vary in the small, the medium-sized or large firm.
The message of this article is that all lawyers in all size firms need to consider the benefits and detriments of accepting the representation of a large client. Lawyers with management roles in firms must address the issues whether the firm has two lawyers or hundreds of lawyers. Lawyers with no management role must consider whether management in their firm is adequately considering the many facets of the large client dilemma and acting on each facet in an appropriate manner. This consideration is of particular importance to Illinois lawyers because Supreme Court Rule 721 makes individual members of a firm personally liable for the negligence of other partners. This may seem a distant concern, but it is a known fact that large-client representations bring down firms and individuals alike. The Enron decline took Arthur Andersen and all of the Arthur Andersen partners down in a catastrophe that none of them will ever forget.
_______________
Donald E. Weihl practices in the St. Louis-Belleville firm of Greensfelder, Hemker & Gale, and is a past chair of the ISBA Law Office Economic Section Council. dew@greensfelder.com
%20Initial.GIF)