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US meltdown prompts LPOs to step up hiring

Several cos plan to double headcount to meet demands.


By outsourcing to Indian vendors, companies can save about 70 per cent in costs vis-À-vis law firms in America.


Adith Charlie

Mumbai, Sept 28 At a time when the off-shoring industry is plagued with instances of employee lay-offs, companies providing legal process outsourcing (LPO) services are on a hiring spree as demand for litigation services from the US rises.

In the next six months to a year, several LPOs have plans to at least double headcount in order to cater to the increased work flow resulting from the recent turmoil in the US that has seen several financial institutions collapse.

The Wall Street crisis has resulted in increased litigation related to bankruptcy, mergers & acquisitions and other related aspects.

Rise in revenue

“In the last six months alone, our revenues have risen by over 100 per cent as US companies and law firms seek to outsource work related to electronic discovery and bankruptcy litigations. In order to cater to the incremental volumes, we need to make substantial additions to our workforce,” said Mr Sanjay Kamlani, Co-Founder & Co-CEO of LPO firm Pangea3, told Business Line.

The city-based company hopes to double its overall headcount from over 300 now in the next one year, he added.

For US companies and law firms, the pressure to put a throttle on costs is immense. By outsourcing to Indian vendors, companies can save about 70 per cent in costs vis-À-vis law firms in America.

UnitedLex plans

Another legal outsourcing firm, UnitedLex Corporation, has plans to more than treble its headcount to 1000 by the end of the current fiscal, according to the company’s Chief Solutions Officer, Mr Ajay Agrawal.

“These additions are essential owing to the quantum of work that we have just been awarded. About 75 per cent of our overall employee base will consist of legal and para-legal professionals,” said Mr Agrawal

Demand side constraints are few as India produces around 80,000 law graduates every year. The Chicago headquartered Mindrest plans to have about 700 lawyers on board by this year-end from 450 currently, according to Mr Rohan Dalal, Managing Director. “You may have demand for your services but if you do not have enough people on board, it does not really translate into anything. We are convinced of the long-term sustainability of our business model and hence are bullish on hiring,” Mr Dalal added.

Vendor consolidation

Many LPO officials believe the catastrophic repercussions of the sub-prime crisis are far from being over. Another side effect is vendor consolidation; in order to further reduce costs, US companies are looking at outsourcing legal processing as well as other business processes to the same vendor, said Dr Navtej Saluja, Vice President- Intellectual Property & Legal Services of KPO firm Evalueserve.

“Hence, only those back office firms that can offer services related to law, company restructuring and financial accounting under one roof will benefit going forward,” said Dr Saluja.

Related Stories:
‘US slowdown sees more LPO work sent to India’
Uptake potential seen high for legal process outsourcing sector

More Stories on : Outsourcing | Human Resources | Courts/Legal Issues

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