A staff lawyer or a freelance consultant? This question was asked by many businesses, if not by all. And any of the control of management found both pluses and minuses of each option.
Some people prefer in-house lawyers (corporate – in house), because they know the situation “from within”, while others are trying to involve external advisors, because they believe in “thrift” and a lot of experience of this option. Let’s see what is the truth.
The effective business management in Ukraine, with its ever-changing legislation, taxation and business conditions, not counting the raider seizure of business by its competitors or public bodies (and the attempts of blocking an activity by public bodies by formal reasons are exactly a raidership) requires the most efficient use “of labor resources “.
Conflicting advantages of a corporate lawyer
Сorporate lawyers, of course, have enough advantages:
- a full understanding of the economic activity of the company from the “inside,” but have no experience with extraordinary events (when “business” has gone beyond the everyday duties);
- solid base of contracts for the supply of goods / services “every day”, but often “baffle” when it comes to exclusive contracts;
- have considerable experience in representing companies in economic courts, but this practice is usually limited to disputes on debt collection.
These basic characteristics of corporate lawyers can be modified depending on the nature of the employer’s activities.
What are they – freelance consultants?
Freelance advisers, compared with corporate lawyers, are more creative:
- have the experience of behavior in stressful and unusual situations;
- have significant experience in the preparation of exclusive contracts, but quickly get tired in the preparation of model contracts;
- have the experience in the representation of interests of the company in a particularly complex cases, but rarely participate in the recovery of accounts receivable processes.
On the protection of own interests
For the correct decision in choosing a corporate lawyer or a freelance consultant you first need to define the purpose.
If the goal is to maintain the company’s daily operations, it will be more efficient, of course, a corporate lawyer. He knows of economic activity, and requires no additional input from management, and is able to represent the company in government agencies and courts in regular situations.
If it comes to criminal proceedings, tax planning, raidership of enterprise / company, investment protection and other emergency situations, greater efficiency will show exactly freelance advisors who understand the nature of the problem and need, and who only need to adapt to the challenges of economic activity of the client.
Conflict of interests
An important problem of Ukrainian realities, unfortunately, is the following situation:
corporate lawyers often hamper the activity in which involved external consultants, without providing them with the necessary information or giving, but not in full
This is not just “works” against the company owner or the top manager, but against the whole staff, because any error made due to the willful failure of information threatens exclusively negative consequences – a ban on the conduct of business, seizure of property or accounts, unsubstantiated continuation of criminal investigation.
So, to resolve emergency situations external consultants is the best choice, while the corporate lawyer is “good” only for routine tasks.
If the practice uses a tandem corporate lawyer + freelance consultant, the company and its assets will be fully protected through the use of the strengths of each.