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Restructuring and Insolvency is a practice area primarily dealing with clients who have run into serious financial difficulties. At a smaller law firm (perhaps a regional firm), these clients will likely be individuals or small, local businesses. At the other end of the spectrum, elite US and Magic Circle firms will be working to resolve financial issues at some of the largest companies and organisations in the world – in matters worth billions of pounds.
Deciding which type of firm is right for you is therefore particularly important in this practice area, due to the noted difference in the kind of work being done.
This is an area of law which encompasses both contentious and non-contentious work (or both litigious and advisory, to put it another way). In non-contentious work, you could be entering the situation relatively early, being called in to help restructure (essentially renegotiate) a struggling company’s debt repayments in a more lenient way. In contentious work, you are looking more at the repercussions of a company going insolvent – e.g. being sued by debtors for failing to pay on time.
Remember that you may be acting for either the debtor or creditor. In other words, you might find yourself attempting to limit the debts owed by a company one day, then seeking to recuperate as much capital as possible for a creditor the next.
As with many areas of law, this practice area rarely stands alone. This is especially true at larger law firms (advising larger businesses with more complex needs), where a number of teams may be pulled together in order to advise on an issue. Here are some possible examples:
In short, this is a practice area which is likely to involve a great deal of collaboration across different teams.
There are a range of tasks associated with this practice area. You might find yourself renegotiating a debt repayment plan one day, drafting up new contracts the next, or conducting legal research into the rights of your client the day after that. The work tends to be very varied across these spaces, and also depends heavily on which level of seniority you sit at within a firm or chambers.
There are a number of firms active in this practice area – looking at the Band 1 firms of Chambers’ most recent rankings can provide some guidance.
At the upper levels of large, corporate City work, Magic Circle firms such as Linklaters and Clifford Chance tend to rank highly. Elite US competitors like Akin and Kirkland & Ellis are equally well-respected in this area.
At the other end of the spectrum, most high street solicitors are active in this space on a personal level (alongside other common issues such as divorce or immigration), and should be investigated individually through further research.
There are a number of skills needed to become a restructuring and insolvency lawyer. Most are common of most commercial law practice areas, including excellent writing skills, research abilities and knowledge of basic financial concepts.
Some skills are particularly useful in this specific practice area, however:
The normal route to qualification applies if you want to become a lawyer in this practice area. For a solicitor, you will usually complete a degree, the PGDL (if your degree was not a qualifying law degree), the SQE (or LPC – soon to be phased out), and two years of QWE (often but not always through a training contract) – though solicitor apprenticeships are now offering a viable alternative to traditional university study. For a barrister, you will complete a degree, the PGDL (again, if your degree was not a qualifying law degree), then branch off into a bar training course and pupillage.
However, there are some specific points to consider if you are looking at this practice area as a particular interest in advance. First, you could choose particularly relevant modules during law school (for example, banking or finance law). Second, you might apply to firms or chambers particularly specialised in this area of law for your work experience. Third, you might even go as far as to consider further academic study relevant to this practice area – for example a Masters in Banking and Debt Finance, or something similar.
It is worth remembering, however, that most law firms and chambers do not expect their prospective employees to specialise this early, so do not feel pressured to do so, either.
It is also worth noting that there are a range of roles in this area which do not require you to become a fully qualified lawyer. Paralegals are highly in-demand in this practice area, for example, earning excellent salaries and often forming a vital role in complex matters.
Restructuring and insolvency lawyers are often in high demand. In-house roles are much less common, as you might imagine, but within firms these are coveted individuals.
Early in your career, solicitor salaries are usually tied to the lockstep model adopted by most major law firms, and so you will be paid equally to lawyers in other practice areas (at NQ level, perhaps £150,0000 at an elite US firm, just over £100,000 at a Magic Circle firm, just below £100,000 at a Silver Circle firm, and so on). At Partner level, however, the pay tends to differ more widely between practice areas, and this practice area is one known for drawing in some of the largest salaries.
Restructuring and Insolvency law is notorious for being an extremely time-critical practice area. Fixed deadlines are often in place within legislation to get certain processes completed, and so when it comes down to crunch time it is not unusual to be working late into the night to get certain tasks completed. Expect an intense but rewarding experience in this practice area.
There is, of course, the factor of the firm you work at as well. Top City firms will always have more demanding hours, and also tend to be dealing with larger clients with more complex and thus time-consuming needs (although this is somewhat mitigated by having larger teams). Personal insolvency cases at a more local level are certainly still intense, and may even eat into your personal life more due to the direct human implications visible at this level, but the hours tend to be slightly better.
A number of current trends are taking place in this practice area, and this is something worth exploring more in order to build on discussions during interviews for training contracts (or vacation schemes) or pupillage – particularly in discussions related to commercial awareness.
Covid-19 is an excellent example of how the changing world we live in impacts this practice area. Restructuring and insolvency lawyers were often busier than ever during the pandemic, as a number of businesses struggled to stay afloat due to incredibly demanding economic conditions. Many of these struggles are ongoing – the pandemic has left significant, long-term economic scars for many.
Brexit is another example worth discussing – businesses may now struggle to conduct international trade to the same extent (or face greater economic issues when doing so), and thus will sometimes face greater risk of bankruptcy.
In short, restructuring and insolvency law is a challenging, collaborative, exciting area of law that moves at great pace and with great intensity. This can make it a challenging area for work-life balance, and it requires a number of relatively specialised skills, but simultaneously it offers a great deal of academic fulfilment, excellent salaries, varied work, and genuine satisfaction for helping clients in many cases.
A range of firms are active in this ever-changing area, and your experience of virtually all the factors listed above will likely vary significantly based on where you choose to work.
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