Updated: Camerons partners back outsourcing deal - market reaction

CMS Cameron McKenna’s partners have given their seal of approval to plans to outsource the firm’s support departments to legal process outsourcer (LPO) Integreon.

A vote of the partnership on the principles of the deal closed last night (22 November), paving the way for the outsourcing arrangement.

The deal, which comes after five months of due diligence on plans that were announced in May, will see Integreon move into the firm’s London HQ.

Integreon’s 25-member London team will now move into Camerons’ Mitre House building, with the UK top 20 firm’s back office staff expected to transfer over to Integreon, while business development and communications staff are believed to be remaining in-house.

The partner vote paves the way for a consultation with staff over the move, with formal discussions, which had been expected to start this week, delayed until the New Year. When news of the plans initially broke in May, Camerons said it was not anticipating any redundancies within its 200-member support staff function as a result of the agreement.

The outsourcing agreement will mark the first time a major law firm has outsourced its entire back office function, with Camerons previously stating that it expects to save between 10%-15% of support staff costs through the arrangement. Under Integreon’s business plan the deal is likely to see the ex-Camerons staff supporting other law firms in the future.

Camerons head of operations Tony Wright, who was instrumental in brokering the deal, is set to remain in his position, but will be employed by Integreon when the project goes live.

In an internal memo sent to staff earlier today, managing partner Duncan Weston said: “I would like to confirm that with the close of the vote yesterday, partners approved the principle of working with Integreon to provide our business services.

“Although we hoped to start the staff consultation immediately, ongoing discussions need to be finalised by the boards of both Integreon and the firm before we can begin this process. We anticipate that we will be in a position to start the consultation with the staff forum in the New Year.”

Integreon is also targeting similar outsourcing projects in the US, after hiring US firm Orrick Herrington & Sutcliffe’s COO Douglas Benson as a senior adviser with a brief to attempt to tie up similar deals. Benson, who was also previously the COO of Clifford Chance’s US operations, joined Integreon in September after eight years as COO at Orrick, where he has overseen the firm’s substantial outsourcing projects.


Market reaction to the Camerons-Integreon deal

“It is a very tricky thing to manage because you are changing the employer of a lot of staff that have been with you for a long time. Partners can be wary about paying for services, but at the same time they want 24-hour service at a high quality. You have to find the right way to save on costs. Camerons is being very imaginative and everybody is watching.”
Chief executive, international firm

“I am not surprised that the partners voted the proposal through – it is an efficient way to boost partner profits and to avoid redundancies. Although I do think that a few firms will jump on the outsourcing bandwagon, it is not beneficial in the long-term”
Corporate partner, UK top 20 firm

“There are mixed views on this with some seeming very into it while others are completely against it. I would say that it is early days. Most firms will wait to see how it works.”
Chief executive, international firm

“We have looked at outsourcing and done the parts that we wanted to do. The reason we have not looked at a wider project like this is because we could not see the correct balance between a cost-saving and a service benefit being achieved.”
Senior partner, UK top 20 firm

“It is one way to control the cost overhead. If that has the effect of destabilising the staff, then that would be a detriment to the arrangement but it is all about how it is addressed, presented and executed. I understand why Camerons is doing this and if it is handled sensibly, and staff get to contribute to the discussion, then if could be the right thing to do. We are not considering it.”
Chairman, international firm


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