In-house lawyers working for companies with operations around the country are finding it increasingly challenging to grapple with the maze of licensing and ethical requirements they face when practicing across jurisdictions.
That’s according to a new survey conducted by the Association of Corporate Counsel (ACC), which finds that as companies “expand their operations across state lines and into new virtual environments” their in-house lawyers face licensing and ethics regulations that are “outdated and inconsistent with the realities of modern legal work.”
Nearly half of in-house counsel surveyed are regularly performing legal work in states where they are not licensed, the survey said, a fact the ACC said underscores the tension between actual legal practice and traditional state-by-state licensing. Concerns about licensing issues are also deterring a large number of in-house counsel from pursuing job opportunities in other states, the survey said.
The ACC’s report comes on the heels of recently released data on compensation that found salary increases for in-house lawyers have declined in the last year and that a majority of in-house counsel are considering changing jobs. New research also shows that as they move, in-house counsel are becoming more assertive in negotiating compensation—yet they may not have the information they need to strike the most lucrative deals.
One License, Many States
Conducted over the summer, the ACC survey asked more than 600 U.S.-based in-house lawyers for their perspectives on multi-jurisdictional practices. “Ultimately, understanding and modernizing [multi-jurisdictional practices] is critical to ensuring that legal talent can move freely and efficiently to meet the needs of a dynamic, national economy,” the ACC said.
Most in-house counsel—59%—are licensed in a single state, the survey found. Twenty-nine percent have licenses in two states, and just 13% are licensed in three or more states. While their bar admissions, in most circumstances, are confined to one state, 48% of in-house lawyers are regularly practicing in a U.S. state where they are not licensed, the ACC found.
“Companies today are national and global in scope, yet the legal frameworks that govern our profession in the U.S. remain fragmented,” said Susanna McDonald, ACC’s vice president and chief legal officer, in a news release on the report. “This survey clearly shows how current [multi-jurisdictional practice] rules hinder both career mobility for in-house counsel and the ability of businesses to access the legal expertise they need across jurisdictions.”
Confusing Rules
Two major challenges face in-house lawyers who practice in more than one state. First, they’re finding it difficult to interpret local laws and regulations governing the legal profession across multiple states. Fifty-four percent of survey participants acknowledged they are having trouble keeping up with the rules.
Second, in-house counsel say rules often conflict from state to state, causing confusion. Some 51% told the ACC this was their biggest challenge in maintaining a multi-jurisdictional practice. And as they struggle to navigate a patchwork of regulations, many lawyers—35%—are fearful they will run into unauthorized practice of law accusations.
The ACC said that many respondents are hesitant to obtain licenses across jurisdictions because of the “cost, time, and administrative burden” involved. Some respondents noted that licensing processes “take more than a year to complete,” the ACC said.
Indeed, when asked to choose all of the methods they used to secure licensing in other states, 61% said they had to sit for and pass another bar exam. Forty-seven percent also said they had received temporary licensing via a motion in court. And 21% were able to use special in-house counsel registration or certification available in some states.
Asking the Bar
A significant number of in-house lawyers, 29%, said state bar associations have failed to provide clear guidance about multi-jurisdictional practice rules. Yet the ACC also found that many lawyers are failing to ask for help when they encounter questions.
According to the ACC data, just 16% have sought guidance from state bar associations regarding their multi-jurisdictional practices. And an infinitesimal 2% have taken the step of asking bar associations for formal opinions. “This low rate of engagement with state bars suggests a need for clearer and widely disseminated [multi-jurisdictional practice] rules,” the ACC said.
Lawyers who have sought guidance or a formal opinion said bar associations were helpful—though only moderately so. The survey responses, the ACC said, “demonstrate an opportunity for state bars to provide guidance that is consistent, clear, and practical.”
Career Impact
Confusion over multi-jurisdictional practices can have a direct impact on the career trajectory of in-house lawyers. Nearly one-third of the lawyers surveyed by the ACC said licensing questions significantly or somewhat deterred them from pursuing jobs in a state where did not have a license.
Retaking the bar exam is a key obstacle to obtaining licensing cited by many in-house counsel. “Respondents feel that their decades of practice should be given more weight than a new exam, which they lack the time and bandwidth to study for,” the ACC reported.
The issue is especially acute in states like California, where a restrictive registration process for in-house lawyers forces them to “choose between undergoing this process, taking the exam again, or foregoing opportunities,” the ACC said. The time spent on the process is also daunting. One lawyer told the ACC that a reciprocity application in the District of Columbia took more than a year to win approval, and another said the corporate admission process in Illinois took so long that it was “jeopardizing my employment.”
Looking for New Jobs
While they may have concerns about whether they can relocate their practices to other states, many in-house counsel appear motivated to move on from their current jobs.
Barker Gilmore, a national executive search, coaching, and advisory firm, recently asked more than 2,700 in-house counsel for data about their compensation and job satisfaction. The survey found that 60% of all in-house counsel are considering a job search in the year ahead.
Across all in-house positions, the most commonly cited reason for searching was for improved compensation and benefits, Barker Gilmore said. General counsel were somewhat less likely to say they were looking to leave than lawyers in managing counsel or senior counsel positions.
The survey was conducted in March, and at the time, 39% of respondents said they were somewhat or very concerned about their job security. They cited “major disruption related to government restructuring or financial market volatility,” the survey said. Most in-house counsel also reported that they are facing resource constraints in their jobs. Eight in 10 in-house counsel said their performance “was either sometimes or always affected by lack of resources or staffing,” the survey said.
Earnings Potential
A slowdown in salary increases may also be tempting in-house counsel to seek greener pastures. In-house counsel salaries grew 2.8% on average during the past year, the survey said. The increase, however, lags the 4.4% growth seen in 2024. While salary hikes may not be as generous, “cash bonus payout rates remain strong,” Barker Gilmore said, adding that in-house counsel took home 93% of their cash bonuses.
Overall, public company GCs are earning the most money, Barker Gilmore found, with total compensation topping $4.5 million in some cases. GCs at private companies top out at $3.3 million, portfolio company GC compensation can reach $2.8 million, and nonprofit GCs may take in as much as $2 million.
Life sciences companies offer the highest median compensation for in-house lawyer positions, $474,000, Barker Gilmore said. Energy companies rank second at $442,000, and consumer companies offer $424,000.
Making the Deal
If turnover increases among in-house lawyers in the year ahead, many of the job seekers will not be shy about asking for more money. A recently released survey of 300 in-house professionals by the legal search firm Kerwin found that compensation negotiations between in-house lawyers and current and prospective employers are in the midst of a transformation, with counsel becoming more assertive about asking for larger compensation packages.
Where conversations about money were once handled “quietly and reluctantly, often at the tail end of the hiring process,” they are now moving “front and center, shaped by shifting market conditions, rising living costs, and a growing recognition that pay is a critical part of talent strategy,” wrote Anne Kerwin Payne, the search firm’s founder and managing partner, in an article published at Law.com.
Nearly all of the lawyers the firm surveyed by Kerwin had engaged in compensation negotiations during their careers, and more than half—54%—had done so within the last year. Just 4% had never negotiated their compensation.
Nine out of 10 respondents said they negotiated base salary, a trend “likely driven by the growing importance of predictable monthly income amid rising living costs,” Kerwin said in its survey report. Half of the candidates negotiated bonuses—a surprise “given that bonuses are often fixed and tied to compensation bands,” Kerwin noted. And those moving to a new company are 50% more likely “to negotiate on equity than those negotiating compensation increases at current companies,” the firm said.
While they are more likely to understand their value in the market, Payne wrote that many in-house lawyers “still enter negotiations without the preparation or data that would allow them to secure the best possible terms.” The survey found that in-house lawyers feel ready to negotiate compensation, but less confident that they have the correct information to make their case. This is particularly true for internal candidates, “who often lack the market data and context available to external hires,” Payne wrote.
While the industry is awash in compensation-related data, Payne noted that many in-house lawyers come to the negotiation table unprepared or overly reliant on data provided by their employers. In-house lawyers should view their own compensation just as they would a legal matter they are handling. “Preparation,” Payne wrote, “needs to be as rigorous as any legal brief.”
---
David L. Brown is a legal affairs writer and consultant, who has served as head of editorial at ALM Media, editor-in-chief of The National Law Journal and Legal Times, and executive editor of The American Lawyer. He consults on thought leadership strategy and creates in-depth content for legal industry clients and works closely with Best Law Firms as senior content consultant.
