Increase Profitability and
Efficiency of your Firm Through
Paralegal Utilization
Tracy Gompf, JD-Paralegal Program Coordinator and Professor
Minnesota State University Moorhead
2017 Fundamentals of Law Webinar-Young Lawyers Division
What is a Paralegal?
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Paraprofessional for the legal profession
Wide range of definitions
Definition has changed in last 20 years
Lawyers use two terms to define support staff:
– Legal Assistant
– Paralegal
What is the Difference?
• Legal Assistants primarily perform clerical tasks as
delegated by the lawyer
– The tasks performed usually can’t be billed to the client
• Paralegals primarily perform substantive legal tasks
that would be performed by the lawyer without a
paralegal
– The tasks are usually billed to the client at the paralegal
rate
Substantive Legal Tasks
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Direct contact with clients
Drafting legal documents for review
Organizing legal files and information
Interviewing witnesses
Preparing discovery documents for review
Legal research and legal writing
Preparing briefs and memoranda for review
Many more!
Delegation of Tasks
• Lawyer can delegate tasks to a paralegal
• N.D.R.P.C. Rule 5.3(d)(1): A lawyer may delegate
to a legal assistant any task normally performed
by the lawyer except those tasks proscribed to
one not licensed as a lawyer by statute, court
rule, administrative rule or regulation, controlling
authority, or the rules of professional conduct
• Rule 5.3(d)2-Paralegals can’t establish clientlawyer relationship, establish fees, give legal
advice, sign pleadings, or appear on behalf of
client
Supervision
• Paralegal tasks are performed under the direct
supervision of a lawyer unless an exception applies
• N.D.R.P.C. 5.3 provides that a lawyer must make
reasonable efforts to ensure that the nonlawyer’s
conduct is compatible with the professional
obligations of the lawyer
• Paralegals are expected to be familiar with rules of
professional conduct that apply to lawyers
Unauthorized Practice of Law
• N.D.R.P.C. 5.5: A Lawyer can’t permit a
paralegal to engage in the unauthorized
practice of law
• Supervisory obligation includes ensuring that
the work assigned to a paralegal is not UPL
• Lawyer must provide sufficient supervision to
ensure that the paralegal is not engaging in
UPL outside of the tasks assigned
Disclosure of Paralegal Status
• Paralegal must disclose status in
communications with clients and third parties
• Paralegal can have business cards and be
listed on lawyers’ signage and stationery with
a disclosure of status N.D.R.P.C. Rule 7.5
• Paralegal must not engage in the unauthorized
practice of law
Billing for Paralegal Tasks
• N.D.R.C.P. 1.5: a lawyer may charge for the
work performed by a legal assistant
• Prohibits any form of fee splitting between the
lawyer and the paralegal
• Compensation of the paralegal cannot be
contingent on the outcome of a case or the
profitability of the lawyer’s practice
Effective Use of Paralegals
• Myths-i.e. Paralegals will “take” work from associates
• Large percentage of tasks in the legal setting can
be effectively performed by paralegals
• Frees the lawyer for tasks that can only be
performed by the lawyer
• Serves clients more effectively with quality of contact
and reduced costs
• Lawyers can serve more clients and increase
professional success
Examples of Paralegal Tasks
• Conduct factual investigation-interview clients and
witnesses for background info and general communication
• Conduct legal research and draft pleadings,
correspondence and other documents
• Maintain calendaring system
• Index or summarize transcripts
• Assemble, analyze and draft discovery
• Client Contact-keep clients updated on case status
• Trial Preparation and Support
• Important!-Review, Implement and Maintain Technology
• Result: Lawyer can handle more cases more efficiently
Analyzing the
Profitability of
Paralegal Work
Hourly All Work by Lawyer at $250 Per Hour
Task
Hours
Cost
Client Interviews
4
$ 1,000
Witness Interviews
6
$1,500
Responding to Written Discovery
12
$3,000
Preparing for and Taking Depositions
12
$3,000
Legal Research
10
$2,500
Preparation of Pleadings
12
$3,000
Trial Preparation
16
$4,000
Trial
16
$4,000
Total
88
$22,000
Hourly with team - Paralegal at $100 Per Hour
Task
Timekeeper
Hours
Cost
Client Interviews:
Lawyer
Paralegal
4
4
$1000
$ 400
Witness Interviews:
Lawyer
Paralegal
2
6
$ 500
$ 600
Responding to Discovery:
Lawyer
Paralegal
2
14
$ 500
$1,400
Prep. for and Taking Depos.:
Lawyer
Paralegal
6
7
$1,500
$ 700
Hourly with team - Paralegal at $100 Per Hour
(Cont’d)
Task
Timekeeper
Hours
Cost
Legal Research:
Lawyer
Paralegal
2
12
$ 500
$1,200
Preparation of
Pleadings:
Lawyer
Paralegal
2
14
$ 500
$1,400
Trial Preparation:
Lawyer
Paralegal
8
16
$2000
$1,600
Trial:
Lawyer
Paralegal
16
16
$4,000
$1,600
131
$19,400
Total:
Improved Client Satisfaction
and Retention
• Reducing Legal Fees
Reducing Legal Fees:
Cost to Client
Scenario 1
Scenario 2
Lawyer Works 88 Hours Lawyer Works 42 Hours
Paralegal Works 89 Hoursrs
Costs to Client $22,000
Costs to Client $19,400
Client Saves $2,600, or 12%
Reducing Legal Fees:
Cost to Firm
Scenario 1
Scenario 2
Lawyer Works 88 Hours
at $182/hr. (Cost to Firm)
Lawyer Works 42 Hours
at $182/hr.(Cost to Firm)
Paralegal Works 89 Hours
at $67/hr.(Cost to Firm)
Total Cost to Firm = $16,016
Total Cost to Firm = $13,607
Firm Saves $2,409 or 15%
Thank You
• For More Information Contact
– Tracy Gompf, JD
– Paralegal Program Coordinator and Professor
– Minnesota State University Moorhead
– 1104 7th Ave. South, Dept. of Economics, Law and
Politics, MacLean Hall, Moorhead, MN 56563
– [email protected]
– For more information refer to the attached
Bibliography for source material
Bibliography-Sources
• James Wilber, “First Thing We Do, Let’s Reduce the Number of Lawyers”,
http://paralegals.uslegal.com/articles/reduce-the-number-of-lawyers/
• Dorthe J. Howell, “Paralegal Utilization: Improving Efficiency and
Profitability”, Maryland Bar Bulletin, January 2007
• MSBA Paralegal Committee: Improve your Bottom Line & Increase Your
Practice through Proper Utilization of Paralegals, revised 2012
• ABA definition of Legal Assistant/Paralegal adopted by the ABA House of
Delegates in August 1997, www.americanbar.org.
• Jeffrey D. Campbell, “The Economic Benefits of Paralegal Utilization”,
Copyright 2005 American Bar Association.
• For further information on Paralegal Utilization:
http://www.americanbar.org/groups/paralegals.html