Challenging times are forecast for legal teams across many sectors. The current economic downturn experienced across the country has resulted in significant changes, which will lead to new or increased challenges in the new year. It has been reported that the UK has an inflation rate of 10.7% in November 2022. These significant numbers are expected to have an impact across many sectors, including legal.
A recent survey conducted by Winmark for Kingsley Napley found that employment and debt-related issues faced by legal teams are predicted to increase this year. The survey which was conducted in November 2022 was prompted to gain insight into how the cost-of-living crisis will affect legal work.
This research involved 50 General Counsel, CLOs as well as Senior In-House Lawyers as participants. The participants involved are employed by companies within various sectors that have national operations.
Increase in Employment and Debt Related Issues
The survey has laid out the impact the current economic climate has on legal work. Among the main findings, it was highlighted that credit risk or debt recovery is regarded as ‘very likely’ or ‘likely’ to increase by 68% of the participants.
Another finding was 53% of participants expect to face an increase in legal requests from internal departments – which include employment disputes. In terms of HR compliance issues, 39% expect to experience an increase in their workload in the coming one to two-year period. On top of that, employee well-being is also expected to be affected by the cost-of-living crisis – with 63% expecting a ‘high impact’ on welfare and mental health.
Although most of the participants admitted that their legal teams are prepared for the coming issues, 39% do not feel well prepared for the expected challenges. This is concerning as preparation is necessary to face turbulent times that are coming in the next year or two.
How to Strategize Ahead
Preparation is vital to face the upcoming challenges that will affect all sectors. Within the legal sector, here are some recommendations to follow.
- Reassessing Legal Functions
With changes in workload and expected issues, it is recommended that legal teams reassess their functions to ensure that proper resources and processes are in place. Additionally, technology, training and support should also be considered in this review.
- Ensuring Employment Abilities
As many companies will face a similar challenge of recruitment, retention and remuneration due to the economic climate, many concerns will ultimately trickle down to legal teams to provide advice and assistance. Resourcing of teams this year will be a necessary concern, which will also involve employee wellbeing. Offering adequate pay and flexible working styles may be an option to ensure employees are working optimally in this challenging period.
- Set Goals
A well-defined strategy and clear goals will be the determining factor in facing the challenging times ahead. Having clear objectives that align with the strategy will help legal teams navigate the increased workload. Additionally, a comprehensive system will also help teams to have a better understanding of what to expect so that they can prioritise workload effectively.