Outsourcing paralegal work allows attorneys to manage fluctuating workloads and reduce overhead costs. Before engaging an external provider, however, attorneys must thoroughly review all applicable Ethics Opinions and Rules to ensure full compliance regarding their professional responsibilities.

If you have specific questions that cannot be resolved through the listed Ethics Opinion or guidelines, please contact the Bar’s Ethics Hotline at 800.235.8619 for further assistance.

Here is the Ethics Opinion regarding outsourcing paralegal work:

• A lawyer is not prohibited from engaging the services of an overseas provider to provide paralegal assistance as long as the lawyer adequately addresses ethical obligations relating to assisting the unlicensed practice of law, supervision of nonlawyers, conflicts of interest, confidentiality, and billing. The lawyer should be mindful of any obligations under law regarding disclosure of sensitive information of opposing parties and third parties. 07-2

GUIDELINES REGARDING OFFSHORING LEGAL SERVICES¹

(Florida Ethics Opinion 07-2)

The Professional Ethics Committee recently responded to an inquiry by a member of The Florida Bar regarding the outsourcing of legal services in Ethics Opinion 07-2. The Florida Bar Board of Governors asked the Professional Ethics Committee to “look comprehensively at the use of others outside of a law firm to assist in the provision of legal services and whether additional guidelines should be adopted including but not limited to, whether there are differences between outsourcing inside the United States and outsourcing outside the United States.” The Professional Ethics Committee fully considered the issues.

The Committee considered appropriate conduct of attorneys regarding outsourcing and offshoring assuming that the attorney complies with all the ethical considerations. Nothing in the opinion should be viewed as endorsing outsourcing or off-shoring in any way by The Florida Bar.

To assist the members of The Florida Bar in interpreting and applying the rules of ethics in this ever-changing age of technology the Committee offers the following guidance. There is a difference between outsourcing legal services and off-shoring legal services. Outsourcing implies that the legal services will be provided by a person or company within the jurisdiction of the United States. Off-shoring legal services implies that the legal services will be provided by a person or company outside of the United States.² The Committee finds that the three major factors which affect the ethical provision of off-shoring legal services are geographical, legal and cultural.

Geographical distance may impede a lawyer’s ability to guide and supervise the provision of legal services. The lawyer’s ability to supervise third party legal service providers may be limited by the lack of day to day observations of their skills, conduct and training and may be further hampered by geographically distant lawyers’ inability to make firsthand observations of the resources and work environments afforded service providers.

The law of non-U.S. hosts of legal service providers may impact the types of work that can be offshored or otherwise limit a U.S. lawyer’s ability to use offshore services. For example, laws of some host nations may prevent the retransmission back to the United States of certain personal identifying information. Performance of work in non-U.S. jurisdictions also limits or prevents a lawyer’s or client’s ability to seek damages for any breaches of confidence, negligence, intentional crimes, or other injuries. Also, United States courts may not have jurisdiction over people working in non-U.S. jurisdictions. The lack of any legal or regulatory authority over a

paralegal or third party service provider establishing a code of ethics, disciplinary procedures and rules regulating their conduct may limit a client’s recourse to seeking recourse from the attorney in the event of any misconduct or breach of ethics.

The cultural differences, while not having the force of law behind them, may provide behavioral drivers that differ from nation to nation. Whether related to privacy, “property ownership” or data sharing issues, these differences can result in behavior that would not be accepted in the United States in general, and specifically in Florida. Failure to understand cultural differences, including language differences, may lead to unexpected results, including unusable work product.

The ABA Formal Opinion 88-356 regarding temporary lawyers notes that two functions are involved with using outside lawyers, “preserving confidentiality and avoiding positions adverse to a client” The Comment states as follows:

Preserving confidentiality is a question of access to information. Access to information, in turn, is essentially a question of fact in particular circumstances, aided by inferences, deductions or working presumptions that reasonably may be made about the way in which lawyers work together. A lawyer may have general access to files of all clients of a law firm and may regularly participate in discussions of their affairs; it should be inferred that such a lawyer in fact is privy to all information about all the firm’s clients. In contrast, another lawyer may have access to the files of only a limited number of clients and participate in discussion of the affairs of no other clients; in the absence of information to the contrary, it should be inferred that such a lawyer in fact is privy to information about the clients actually served but not those of other clients.”]

As the use of information technology becomes more prevalent in the practice of law, the lawyer’s ethical duties to maintain client confidentiality and to supervise nonlawyers become more complex. Lawyers should maintain physical, electronic and procedural safeguards to securely store information about clients and safeguard it from unauthorized access, alteration and destruction. Lawyers should understand the technology of the creation, transmission, storage, and deletion of electronic data to the extent necessary to prevent inadvertent disclosure of client’s data and to the extent necessary to maximize resources to perform work more efficiently for clients. The use of access codes, passwords and firewalls, virus protection, secure transmission and storage methods should be explored. Lawyers should limit disclosure of client identifiable data whenever possible. For information which is required to be used in client identifiable data, consent should be obtained for both the disclosure of the information and the purpose for which it is used. Lawyers should also familiarize themselves with privacy laws of their offshore service providers to avoid situations in which the hosting jurisdiction arrests the transmission of data back to the United States.

The actual “how to” supervise the nonlawyer legal service provider is a personnel or human resource issue that falls outside the purview of the Rules of Professional Conduct. However, the following are some suggestions offered by the Committee:

1. Communicate regularly with the third party service provider to ensure that all offshoring employees have the proper training and an understanding regarding the importance of confidentiality.
2. Within the parameters of the hosting nation’s laws, utilize technology to monitor activities of third parties.
3. Within the parameters of the hosting nations’ laws, consider available technology such as sophisticated monitoring devices, which can provide remote checking of e-mail, web sites and programs that employees access, when employees log in and out of their computers and even their exact key strokes.
4. Restrict any direct client contact from the third party service provider.
5. In addition to carefully reviewing final work product, assess the means by which that work was performed. Lawyers should evaluate such facts as whether the length of time needed to perform the services was reasonable given the resources available to the service provider.
6. Do not substitute non-lawyer work product for that of lawyers exercising their independent professional judgment.
7. Consider whether the lawyer and the offshore provider can enter a valid and enforceable contract that would provide the lawyer and clients with recourses for damages resulting from a breach of confidentiality, negligence, or other harmful conduct.

The ABA examined ethics opinions and guidelines that have been issued by courts and bar association committees and indicated that following are the basic precepts that lawyers must observe regarding the employment of nonlawyer assistants:³

1. The lawyer must retain a direct relationship with the client.
2. The lawyer is personally responsible for the training, supervision and work product of the nonlawyer assistant.
3. The lawyer must inform the client that the nonlawyer assistant is not a lawyer and that the lawyer is personally responsible for her supervision and work product.
4. The lawyer must instruct nonlawyer assistants in the relevant Rules of Professional Conduct and their correlative obligations thereunder.

The New Jersey Bar Association discussed independent paralegals and stated the following⁴:

Without the direct supervisory control contemplated by RPC 5.3, the attorney who utilizes the independent paralegal might not have professional responsibility for the paralegal’s misconduct. With the separation of the independent paralegal from the attorney, both by distance and relationship, the ability of the attorney to make reasonable efforts to insure that the paralegal’s conduct is compatible with the professional obligations of the lawyer must diminish. The danger of legal work being done without appropriate professional responsibility to the public increases to a point wherein it cannot be condoned.

¹These guidelines apply to offshoring legal services, but some may be applicable to domestic outsourcing as well.

²See Outsourced Legal Services – Introduction and Explanation, Prism Legal, www.prismlegal.com, April 12, 2005.

³“Model Guidelines for the Utilization of Legal Assistant Services” (1991), quoted in New York State Bar Association Guidelines for the Utilization by Lawyers of the Services of Legal Assistants, 1997.

⁴ New Jersey Unlicensed Practice of Law Opinion #24 (11/15/90)

To review the Ethics Informational Packet on Outsourcing Paralegal Work, including the complete list of available packets, select this link: Ethics – Informational Packets.

Additionally, you can browse the Ethics Department’s complete Subject Index of Ethics Opinions for further guidance on other topics.

*Note: Advisory ethics opinions are not binding.

VIEWS AND CONCLUSIONS EXPRESSED IN ARTICLES HEREIN ARE THOSE OF THE AUTHORS AND NOT NECESSARILY THOSE OF FLORIDA BAR STAFF, OFFICIALS, OR BOARD OF GOVERNORS OF THE FLORIDA BAR.