In good company

In good companyLaw firms may be the first port of call for most students applying for training contracts, but opportunities to bag places within the in-house legal departments of the UKs biggest companies are gradually increasing.

In an exclusive survey conducted by Lawyer 2B on the legal departments of FTSE100 companies, 16 out of the 91 companies that responded just 18 per cent said they offered training contracts.

Need to know
Training in-house is the road less travelled, and here is the essential information to help get you to your destination.

Who? Unlike their counterparts in law firms, many in-house trainees gain experience in a corporate environment before they take the
plunge into law. Many trainees come from different parts of the business and have transferred to legal via a law conversion course.

What? A training contract in-house will be heavy on corporate and commercial work,but there will be scope to do seats in more specialist areas, such as litigation and intellectual property depending on the company. As a trainee, you have a right to a varied experience. Many companies will send you for a six-month secondment in a law firm if they cannot offer training in certain practice areas.

Where? Though this feature has focused on training contracts with FTSE100 companies, it is worth exploring large privately owned companies or foreign businesses with presences in the UK. It is also worth exploring the public sector, including local and central government. Your research should initially focus on whether a company has an in-house legal function. Unfortunately, a comprehensive list of all the organisations that offer in-house training contracts does not exist, so it really is a case of sniffing out opportunities. (Of all the law fairs Lawyer 2B attended last autumn energy giant EDF was the only company we spotted with its own stand.)

So keep a lookout in The Lawyer, which often publishes stories about in-house legal departments, and do not be afraid to pick up the phone to make your own enquiries about potential opportunities.

In terms of geography, the opportunities tend to be where the companies have their headquarters. London is important, but is
not the only place to train.

When? Because legal trainees are rather exceptional within a company, there are not the same rigid hiring cycles you will find in law firms. Most companies hire trainees on an ad hoc basis as and when the need arises or the right candidate comes along.

How? The application process depends on the organisation. Usually the central HR department handles the initial application stage, working with one or two senior lawyers who are the designated trainee contacts in the legal department. The other part of the how is down to you. The legal department will be looking for people who are clued up on how the companys business works and any developments in the wider industry. Do your research and wear a suit.

Why? Training in-house is a good way to get real business experience while building up a budding career as a solicitor. It will
differentiate you from the crowd of your peers that trained at law firms and will look impressive on your CV should you wish to join
private practice later, because you will have worked with the clients that pay the bills.

As an in-house trainee you will be quite a rarity. You might have less contact with trainees in a company, as they tend to hire fewer than law firms, but you will avoid the strict hierarchy of life in private practice.

This may not sound like a lot, but it does represent an increase on last year, when only 15 per cent provided training contracts. Those that do offer training include champions of UK industry such as BT, BAE Systems (see box), Standard Life, Vodafone, National Grid, United Utilities and British American Tobacco.

The banking sector is leading the way. This is driven in part by a competitive in-house Recruitment market for lawyers with experience, making it more convenient for banks to train their own rather than pay top whack to those who are already qualified.

Barclays investment banking arm Barclays Capital (BarCap) launched its first programme last year and Standard Chartered Bank is introducing a training programme next month (March) with a view to expanding it at a later date.

BarCap now takes up to five trainees a year and is one of the few in-house legal teams that actively encourages students to apply for training contracts by attending graduate recruitment fairs.

Meanwhile, Standard Chartered is getting ready to take on its first trainee for a stint that will involve a corporate seat and a wholesale banking transactional seat, as well as a contentious seat with one of the banks external advisers.

Susan Adams, head of legal, policy and operations at the bank, says: The recruitment market is very tight and its difficult to get people with the right experience. We want to train people ourselves so they understand how an in-house lawyer needs to think and work.

Meanwhile, the success of the BarCap programme has piqued the interest of Richard Daniel, the chief operating officer of the legal group at Barclays Bank, who is considering rolling out a training programme across the whole group as a result.

At the moment we just have trainees in Barclays Capital, but its something were looking at for the rest of the group, he says. One of the reasons weve hesitated in the past is the question of whether we were able to give the individual a broad enough experience to make the training programme valuable.

The reason were revisiting it is that were actually a pretty big legal team now around 750 people in total and as weve got to a certain size so our ability to provide a good breadth of training has increased.

With the current turmoil in the worlds financial markets and lending between banks slowing to a halt, banking might seem the last place for new prospects. But the players in the sector are still keen on the idea of training.

Its a bit too early to say what effect this may have, but were a global organisation thats got global legal needs and were not in it for the short term, says Daniel.

This contrasts with the apathy shown by other industries. Construction giant Persimmon one of the largest in the UK has not hired any trainees this year, despite offering positions last year.

Instead the legal department is focusing on bringing in specialist conveyancers rather than training up solicitors.

Forget trying to get into a big energy company either. FTSE100 oil company Tullow Oil has never taken on trainees and even one of the worlds largest companies, Royal Dutch Shell, will not take them on.
Richard Wiseman, UK head of legal at Shell, says: We dont think weve got the resources to train and supervise people to the right levels. Shell recently reported an annual profit of 13.9bn, a record for a UK-listed company.

This shows that in-house resources and encouragement for students who want to work in a company are low compared with those available for law firm applicants. To get into these schemes you will need initiative, commercial awareness and in-depth knowledge about the company you want to join. A certain amount of luck will also come in handy.

Companies rarely go out looking for legal trainees externally because they have a lot of applicants who already work in other areas of the business. So that means you will have to call and email the HR department, which will contact the right legal director on your behalf. If there is a space for you, the legal team will take it forward.

The process is often less formalised than in private practice and few companies have set dates for trainee intakes, tending instead to bring them in on a rolling basis depending on need and the candidates available.

You will also have to be prepared to earn less than your friends over at Linklaters. For example, a trainee at Tesco will get a healthy salary of 25,000 to start with. A magic circle trainee will get an even healthier 36,000 a year, rising to 64,000 upon qualification.

Some companies will be willing to sponsor you through the LPC, such as BT and Royal & SunAlliance.

If you do decide to train in-house, be aware that your experience will be a different one to that gained at a law firm. You will notice this difference on a social level, too. Companies that do have trainees do not tend to have as many as law firms and often put their trainees in different business units and offices as and when the business requires.

This will mean that your social circle of peers is smaller than a trainees in a big City law firm.

One trainee at a FTSE100 company comments: Theres a trainee schemes group, but we dont have a lot of social contact because all the trainees are spread out.

On the other hand, legal groups in-house tend to be structured less rigidly than those in law firms and you are more likely to be treated as an equal by those with more legal experience. There isnt that sort of hierarchical picture, says the trainee. You can chat equally with the legal directors.

You may also have slightly less choice in the type of law that is available for you to train in. All companies will offer six-month seats in corporate and commercial, and some will also have seats in tax and employment law. But if you want to work in a niche area such as intellectual property, you may find your options limited within certain companies, and it is likely that your boss will send you on a secondment to a law firm to gain more varied training.

As noted above, some general counsel are not massive fans of trainees. Lawyers cost money within a company and many prefer to keep their annual legal budgets down by not offering training contracts. Graham Martin, general counsel at Tullow Oil, told Lawyer 2B: I suspect well never get to the stage of taking on our own trainees. Theres not really an incentive for us and we dont have much spare capacity to train them. Were quite happy with the balance we have and weve got a good spread of law firms and people weve got to know and like.

Despite this, there remain two schools of thought. A handful of industry legal chiefs believe that taking on trainees is essential for a legal departments survival in a big company.

Deepak Malhotra, outgoing general counsel at drinks giant InBev, has strong views on the subject. If the sales department, the marketing department, general management and the finance department can take on trainees, then why wouldnt the legal department?

Whats so special about our function? Taking trainees works for every other department and no ones going to think that the process is any less complicated in legal. If the idea of training in a law firm does not appeal to you, then going in-house could be the best route to take. You will be closer to the decision-makers on deals and will learn how a business works from the inside.

The only drawback is that there are fewer places for external applicants. Whether more in-house departments warm to the idea of taking trainees will be seen in next years survey of the top legal departments in the country.
Additional reporting by Ed Hunter

TRAINEE PROFILES

How did you secure your training contract at BAE?
Adam: Karen and I already worked as contracts officers in the commercial department. Wed both worked with the legal team in the past in my case on a litigation matter and the experience prompted us to reconsider a career in law. When the vacancies for the trainee legal adviser positions were advertised, we decided it would be the ideal opportunity.
Why did you decide to do your training contract in-house?
Adam: Working in-house is a more rounded role. Theres a greater variety of work and youre given far more responsibility than perhaps youd get in private practice.
Karen: Youre better able to build up a detailed understanding of the business and the workings of the industry. You also have a great level of client contact, so you quickly establish effective and trusting working relationships.
How big is your companys legal department?
Karen: There are currently forty eight lawyers within BAE Systems in the UK, and our business unit legal team has seven lawyers and two trainees.
What does your typical day involve?
Adam: Im usually in the office by 8.30am and the kettles on by 8.32am. Then I check and reply to emails, which can range from anything from queries on employment issues or intellectual property rights to data protection. I then try and prioritise the work that has to be done that day, but invariably everythings equally urgent, so its not always that easy. The days usually spent reviewing contracts and agreements, researching and in meetings with clients, discussing their requirements and providing them with feedback on their documents.
What is the best aspect of your job?
Adam: I like the variety of the work. Although it falls under the broad heading of commercial, you can be putting together a confidentiality agreement in the morning, then reviewing a contract to sell aircraft in the afternoon. Theres a new challenge in each phone call or email, and you learn something new in everything you do, so no two days are ever identical.
Karen: I enjoy working in a fast-paced environment, and because were a relatively small department, trainees are regarded as valuable members of the team. Im not afraid to express an opinion, or make a mistake, as I know the others will be supportive if I do. Im also very well supervised.
What is the worst aspect of your job?
Adam: Sometimes its difficult for clients to understand that their query isnt the only problem you have to deal with in any given day.
What time do you usually leave the office?
Adam: Were both studying on the LPC part time, so on Monday and Wednesday we have classes in the afternoon. On Tuesday and Thursday it tends to be between 6pm and 7pm, and a little bit earlier on a Friday. The hours arent too bad really.
Your company only has a handful of trainees. Would you not have preferred to train in private practice, where you would be in a large intake of trainees?
Adam: I think there are arguments for training in both environments. Well have to do placements in private practice, as BAE cant provide experience in three areas of law, so well gain experience in larger departments then. Its a really close team, though, and youre very close to whats going on.
What are your future career goals?
Adam: Qualifying first of all. I havent thought much beyond that, really, although I do quite like the idea of practising in the US something that might come from watching too many episodes of Ally McBeal.
Karen: My focus at the moment is on qualifying.