The ABCs of the Legal Industry
By Jennifer Cygan
January 26, 2023 | 4-minute read
Business of Law Business Structures and Trends Content Type Blog Post Additional Options Content Level: Essential
The legal industry is a unique space to work in, with its own set of terms and acronyms. Although jargon can vary from firm to firm, we’ve assembled a list of the more common terms and acronyms for reference, broken down by subject area.
Law Firm Structure
- Associate: A less experienced attorney, usually a recent law school graduate; the typical time to partnership for an associate is seven to eight years.
- In house/general counsel: An attorney who works for a company managing legal issues. May also be responsible for hiring outside firms to perform legal work.
- Of counsel: Usually operates as an independent contractor, not an employee of the firm. They can be senior attorneys who are cutting back on their work, or less experienced attorneys who do not desire to work full time.
- Paralegal/legal assistant: Directly supports attorneys and can perform legal activities, but not usually allowed to offer legal services independently.
- Summer associate: Law school student who works at a firm for a short period or during an internship.
Boutique firm: Typically consists of fewer than 20 attorneys who specialize in a specific or niche practice area.
- Industry group: Group of attorneys who routinely work matters related to a specific industry.
- Practice group: Group of attorneys within a firm that specializes in a specific area of practice such as family law, workers compensation, immigration, corporate law or civil rights law.
- Managing partner: Typically an equity partner at a larger firm who also assumes management, operational and strategic duties.
- Two-tier partnerships
- Equity partner: Buys partial ownership of the firm; compensation is based on the firm’s profitability.
- Non-equity (or income) partner: Achieves partner status but does not have ownership and compensation is salary based.
- Solo practitioner: The firm is owned and run by one attorney.
Attorney differentiation for billing purposes:
- Originating attorney: The attorney responsible for bringing the client work to the firm.
- Responsible attorney: The attorney overseeing work on the client/matter (see entry for the term “matter” below).
- Timekeeper/working attorney: Attorneys who work on any of the client’s matters.
- Alternative fee arrangement (AFA): Billing arrangement with a client not based on the traditional hourly rate. Common examples of AFAs include:
- Blended fees: Client pays a set average hourly rate for all attorneys working on a matter.
- Capped fees: Based on hourly rate, but work ends when fees reach an agreed upon maximum for a matter.
- Contingency fees: Attorneys are paid a percentage of the client’s payout upon successful completion (these can be dependent on ethical and state/jurisdiction rules).
- Fixed or flat rate: Client pays a predetermined amount for work over a specified time period.
- Sliding scale fees: Rates are based on the client’s ability to pay for legal services.
- Subscription-based fees: Clients pay a set, recurring monthly fee for access to legal services.
- Success/performance initiatives: Can include extra payment(s) if attorneys meet specific predefined criteria or success is achieved.
- Billable hour: Time spent working on a matter that is charged to the client according to the agreed upon hourly rate.
- Hourly rate: The rate an attorney charges for an hour of work.
- Origination credit: Compensation based on the revenue of the client that goes to the originating attorney.
- Pro bono: “For the public good;” attorney services completed for a reduced rate or no fee.
- Retainer fee: Amount paid by a client to retain a firm or attorney for services; billable fees are then typically deducted from the retained amount
Business development: Goals are to create and maintain client relationships, ultimately bringing new business to the firm. It is more of a sales-based approach, but many jurisdictions have rules regarding sales within the legal sector.
Marketing: Building a recognizable brand and promoting services; it includes market research and advertising.
Marketing technology (MarTech): Software solutions that drive a firm's marketing and business development objectives and innovation. Examples include:
- Customer relationship management (CRM) databases and software systems
- Email marketing tools
- Analytics tools
- Content management
- Social media
Matter: Issue requiring legal service (e.g. contract dispute, divorce, bankruptcy, harassment investigation and intellectual property filings).
Rankings and directories:
- Best lawyers: Based on peer reviews.
- Chambers: Widely recognized ranking provider that requires a detailed submission process, including attorney and reference interviews.
- Super lawyers: Ranked by peer recognition and professional achievement.
- Vault Law 100: Based on surveys and feedback.
B2B: Business to business
B2C: Business to consumer
CAC: Customer acquisition cost
CMS: Content management system
CPL: Cost per lead
CRM: Customer relationship management
CTA: Call to action
CTR: Click through rate
GTM: Go-to market
KPI: Key performance indicators
RFI: Request for information
RFP: Request for proposal
ROI: Return on investment
SEO: Search engine optimization
SWOT: Strengths, weaknesses, opportunities, threats
UVP: Unique value proposition
UX: User experience
YoY: Year over year
PD: Practice development
PG: Practice group
PGL: Practice group leader
PI: Practice innovation
PIP: Performance improvement plan
PPP: Profits per partner
RP: Relative profitability
RPL: Revenue per lawyer