Just 33pc of lawyers cut rates despite downturn
JUST one in three law firms cut the hourly rate charged to customers over the past year, but lawyers see pressure on their fee incomes as the number one issue facing the industry in the year ahead.
Work driven by the implosion of Ireland's banks has emerged as a "major filler" for Ireland's top law firms, according to the same new research.
International business, bank restructuring, NAMA and litigation have helped to shelter Dublin's top commercial law firms from the full impact of the recession, an inaugural survey of almost 100 Irish law firms has found.
Law firms here rarely publish financial details about their own businesses, so the new survey is a rare insight into the trends affecting the industry.
It is a major reason why hourly billing rates at two-thirds of law firms were unchanged last year, even in the teeth of the deepest economic crisis for generations.
Most of the large and mid-tier firms have been "kept very busy" in the aftermath of the collapse, according to the survey carried out by accountancy firm Smith & Williamson, supported by Amarach Research.
Five of the country's top 10 law firms, 14 mid-tier and 74 small firms took part.
All law firms have been affected by the recession, with the total amount of fees reducing "considerably" over the last few years, said Paul Wyse, managing director at Smith & Williamson's Dublin office.
"There is greater confidence among those surveyed in the outlook for the sector and their individual firms for next year, albeit that almost one in two surveyed think it will be a stable outlook," said Mr Wyse.
"Many firms do not expect any material pick-up until there is greater stability and certainty with respect to the future of the eurozone. For small practices and businesses, it continues to be difficult to raise finance."
Pressure on fees is seen by 75pc of law firms as being the number one issue facing them over the next year as firms come under pressure from clients.
Justice Minister Alan Shatter's planned Legal Services Regulation Bill to reform the legal sector, as well as the resolution of disputes over fees by the taxing master, are also leading to concerns about pressure on fees.
The survey, released today, reveals overwhelming support for new laws to allow the introduction of limited liability partnerships for law firms.
But it says that the burden of increased regulation and increasing professional indemnity costs is pushing up some costs for many legal practices.
The burden of regulation is expected to escalate with the passing of the bill.
Growth areas identified by the survey include the food and agri-business sector, litigation and corporate recovery and insolvency.
Areas that appear "resilient" include employment law, insurance and health care.