In-House or Private Practice: What’s the Difference?

Embarking on a legal career presents a pivotal choice between two primary paths: private practice lawyer and in-house counsel. Each offers distinct experiences, responsibilities, and career trajectories. Understanding these differences is crucial for lawyers at early stages in their careers in order to maximise your potential in your chosen route and to navigate your experience towards your career goals.

Training and Early Responsibilities

In traditional private practice, aspiring solicitors typically undergo a structured training contract comprising four ‘seats’ in distinct legal areas. This rotational approach provides exposure to various specialties, allowing trainees to identify their preferred niche. During this period, junior lawyers often operate under close supervision, focusing on specific tasks within their assigned departments.

Conversely, in-house legal teams may offer a more integrated training experience. Whilst some companies and financial services organisations still offer traditional seats, many provide a more varied training contract where you gain mixed experience whilst learning more about the industry and business that the legal team supports. Both options are frequently supported by a seat (often litigation) in a law firm to satisfy the law society requirements which also offers understanding of the relationships between law firms respond to their clients. A more recent and very common way to qualification is the Solicitors Qualifying Examination (SQE) route whereby you gain 2 years qualifying work experience and sit 2 rounds of exams.

Newly qualified lawyers in-house often handle a broader spectrum of legal issues simultaneously, reflecting the diverse needs of the business. This environment can accelerate responsibility, as in-house counsel are required to address immediate legal concerns across multiple domains. 

NQ solicitors in private practice are likely to get more detailed technical experience and will be working closely with absolute experts in their field.

Scope of Work

Whilst some law firms and individual teams are sector focussed, generally private practice lawyers serve a diverse clientele, each with unique legal challenges. This diversity allows for specialisation in specific legal fields, enabling lawyers to become subject-matter experts. However, this focus may limit exposure to the broader business implications of legal decisions. You may be working on a small part of a deal and not get to see the final outcome or be working on a case that has already progressed to litigation without the understanding of how this could be avoided.

In contrast, in-house lawyers are dedicated to a single client: their employer. This role demands versatility, as they must navigate various legal matters, from regulatory compliance to contract negotiations. In-house lawyers often gain a deeper understanding of their organisation’s strategic objectives, as they work across multiple legal areas rather than specialising in just one. This broader exposure enhances their ability to provide tailored legal advice that aligns with the business’s commercial goals.

Client Interaction and Communication

Private practice lawyers interact primarily with external clients, necessitating formal communication and a strong emphasis on client relationship management. Success in this arena often hinges on attracting and retaining clients, alongside delivering precise legal solutions.

In-house counsel, embedded within the organisation, engage directly with internal stakeholders across all levels. This proximity facilitates immediate collaboration but also requires the ability to translate complex legal concepts into practical business language. Effective in-house lawyers are adept at aligning legal strategies with the company’s commercial objectives and they must be able to build relationships from the bottom right up to the CEO.

Work Environment and Culture

Private practice environments are often high-pressure settings with demanding workloads. The emphasis on billable hours can lead to extended working periods, impacting work-life balance. Recent reports highlight that junior lawyers in prestigious firms may face over 70-hour workweeks, contributing to stress and potential burnout.  Working on larger deals in private practice often involves meetings with clients across multiple jurisdictions and unsociable hours and you can often be called upon at short notice and have holidays and weekends interrupted.

In-house roles may offer more predictable schedules and a collaborative atmosphere. While deadlines and high-stakes projects are inherent, alignment with core business hours can provide a more balanced lifestyle. However, the expectation remains to address urgent matters promptly, and this reflects the dynamic nature of business operations.

Career Progression

Typically, private practice follows a hierarchical trajectory, from associate to partner, with clear milestones. Advancement is often linked to billable hours, client acquisition, and specialisation. However, the traditional law firm model has been evolving with technological advancements, potentially affecting the structure of some law firms, having a knock on effect on culture.

In-house career paths can be less defined, sometimes resembling a ‘flat’ organisational structure. Progression may depend on the organisation’s size and the availability of senior roles – often seen as dead man’s shoes. Nonetheless, in-house lawyers often gain valuable business acumen and may transition into executive positions beyond the legal department. For those not set on always operating as a lawyer, options often come up in compliance and company secretarial departments where the legal background continues to be utilised. Career progression in-house can be more about expanding your skill set than an actual step up.

Performance Metrics and Flexibility

Private practice lawyers are frequently evaluated based on billable hours and revenue generation, fostering a competitive environment with stringent targets. This focus can influence work patterns and personal time management.

In-house counsel are typically assessed on their ability to manage legal risks, contribute to business strategy, and support various departments effectively. This role often allows for greater flexibility in work arrangements, aligning with the organisation’s policies and culture.

Reward

Remuneration in private practice can be considerably more than that of an equivalently experienced lawyer in-house. It will vary depending on the size and coverage of the firm with US firms offering more than double some other City firms. The salary gaps are particularly apparent at the NQ level and at the very senior end.  With the recent war for early talent in recent years, some have said that private practice salaries have become unsustainable and there has been a knock-on effect in-house, with employers having to pay more for their junior lawyers.

In-house there has been some compression in salary ranges between junior and senior lawyers, with the more senior lawyers often receiving little more than inflationary rises. Without the option of aspiring to partnership, and limited promotional prospects, organisations find it hard to justify paying a 20 year qualified lawyer significantly more for work that a 6-8 year qualified lawyer may be able to do. Many lawyers with desirable skillsets find they must move on to get any kind of significant rise without promotion.

In-house salaries and bonuses can vary so much depending on the business you join. Commerce and retail will pay less than insurance, but banking pays more than insurance. Fintechs, private equity, hedge funds and other potentially high-risk companies can offer either very high base salaries with limited bonus and benefits, or very low ones with high bonuses and equity. Some financial institutions can offer salaries as high as private practice salaries, but they will expect private practice hours and may not offer the change of culture.

Choosing between private practice and in-house roles involves careful consideration of one’s career aspirations, preferred work environment, and desired work-life balance. Private practice may appeal to those seeking specialisation and a structured advancement path, while in-house positions offer a broader scope of work with direct business involvement. Both paths present unique challenges and rewards.

If you’re thinking of moving in-house and have an interest in financial services, feel free to contact us here at Fry & Brown for more personalised guidance.

Apr 2025