In-House Legal Trends for 2023

2023 In-House Trends
  • Legal Dive published its list of six in-house trends to watch in 2023 based on its view of key developments in the law and legal department management that will attract in-house counsel's attention.
  1. Fee management
    • Law firms intend to increase rates by 7-8% in 2023 but legal departments are searching for ways to cut external spend, in part by experimenting with alternative fee arrangements.
    • 60% of large company legal departments have been able to negotiate fee arrangements that differ from traditional hourly billing, but only 30% of small legal departments have done the same.
  2. Legal operations
    • In-house departments are expected to turn more attention to legal operations specialists in 2023. Roughly 60% of legal departments have a legal operations specialist today, up from 45% a few years ago.
    • Legal operations are helping in-house departments cut costs in part due to process automation and technology adoption, with the desired impact of shifting the legal department from exclusively a cost center to at least in part a business driver.
  3. Artificial intelligence
    • Open AI’s ChatGPT and the underlying GPT-3 technology has shown the potential to significantly impact how in-house and law firm counsel draft contracts and complete e-discovery.
  4. Data privacy
    • The California Privacy Rights Act (CPRA) went into effect on January 1. Privacy law compliance is expected to consume resources not simply to make operational adjustments, but also to put in place processes to identify and manage regulated consumer data.
  5. Pay transparency
    • State laws are requiring employers to disclose pay, or a range of pay, when advertising job openings.
    • With some companies viewing this obligation as limiting and potentially exposing them to increased liability, they have turned to publishing wide ranges that bring into question their good faith efforts to comply.
  6. Mergers and acquisitions
    • According to a CounselLink report, M&A activity generates the highest average hourly rate for law firms. An economic slow down may chill dealmaking in 2023.
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