Poaching Staff from Competitors – Mistakes to Avoid – article by Ten Percent Legal Recruitment for law firm owners looking to recruit staff from competitor firms.
There is often an assumption that recruitment consultants are working away in the background, planning to approach law firm staff at every practice and encourage them to move to a new practice. Headhunting is exactly this; looking at the market, identifying potential candidates that may be a fit and making direct approaches.
It rarely works for recruitment consultants. The headhunting market is saturated, LinkedIn has been completely overused, and most candidates are completely immune to cold callers offering them a pot of gold. As recruiters, we prefer to work on longer term roles and would much rather a candidate make a move (or not) for the right reasons and flourish.
However, this does not mean that poaching staff from competitors is not without its merits. We speak with a lot of law firm owners in relation to M&A work, and it is really interesting just how much recruitment takes place on a very informal basis, within the law firm’s own networks. A partner will know of someone they used to work with, who will know someone at another firm who may be up for a move, very relaxed chats will be had to ascertain an interest and subsequently employment will be offered.
This type of recruitment is considerably more effective than using recruitment agencies – you have references before interviewing from people you trust, there tend to be genuine reasons for the candidates to look for a move, there is some confidence that the recruitment will be successful and a lot cheaper than using recruitment agencies!.
However, here are some of the key pitfalls to avoid when recruiting from competitors.
Political Ramifications
Making direct approaches to competitor firm staff can leave a very awkward relationship if the other business owners find out. Although it is just business, in reality most employers take it very personally when a candidate leaves. If you have a good relationship with a local firm, who may even refer you work from time to time, you need to take this into account when making the approach.
Restrictive Covenants
Although our experience of this is that in most cases the restrictive covenants are either a) too badly drafted to be enforceable or b) not enforced because the law firm owners can’t be bothered, many solicitors & fee earners will be subject to them and you do need to look carefully at them. It may be worth asking target staff to provide further details about clauses preventing them from soliciting clients, approaching former colleagues or joining a direct competitor for a set period.
Failing to Oversee Client Approaches
Its certainly the case that new hires often possess valuable market knowledge, but there is a clear distinction between benefiting from a new lawyer’s experience and accessing another business’s confidential information. Whilst I am sure some firms are more than happy for new staff members to approach clients at their old firm and attempt to tap them up, most would be horrified. Keep a close watch on exactly how new clients are being obtained and avoid the obvious serious issues that could affect both you and the new lawyer.
Ignoring the Existing Team
Very often not enough thought is put into how a new member of staff, freshly recruited, is going to fit into the existing staff team. Who are they going to report to, who is going to report to them? Is everyone going to work together or are there going to be issues? The new member of staff may be wonderful, but if they cannot fit into the existing team is this going to have an effect on your profitability?
Overlooking Cultural Fit
It can be tempting to recruit a high-performing individual purely because of their client following. However if your new star lawyer works 80 hours a week, shouts at his/her secretary and gets very upset if the tea bags are not put neatly in the cupboard, your existing fairly chilled team of staff may well want to move firms themselves fairly swiftly! If the candidate’s working style, expectations or values do not align with your firm’s culture, the move can quickly become expensive and disruptive.
Failing to Protect Your Own Business
Businesses eager to recruit externally often forget to review their own employment protections. If you are targeting talent from competitors, chances are your competitors may be targeting yours too. Now is a sensible time to review employment contracts.
Being Poached?
If you are the lawyer being poached, think carefully about any move like this. If you are in a small town where chances are you will be bumping into your former boss at Sainsburys, is this something you are going to be comfortable doing? Why are you considering a move – are you doing it for the right reasons? Do not rely on the word of others that the new firm has the work culture you want to be part of. Check everything out yourself, make sure you see for yourself that the firm is good for you. And remember that if you are approached by a firm, you are in the driving seat when it comes to salary negotiation. Very often the only way you can get a sizeable salary increase is by moving firms – don’t miss the opportunity.
