Ethical Issues “On the Side” Employment Raises
By Edward McIntyre
Note: This week features a spin-off of the popular San Diego Lawyer Ethics column, where fictional characters discuss real ethics scenarios. Macbeth, a long-recognized expert in legal ethics, professional responsibility, and the law of lawyering is joined by Duncan, his nephew, and Sara, the very bright newest member of the firm.
Duncan spoke. “Uncle, isn’t this off our usual venue?”
Macbeth winked. “Thought you and Sara would like the chance to spread your wings. We’re meeting a young lawyer here. Pull up a chair.”
As soon as all three were seated, a young man approached. “Mr. Macbeth?”
“The same. Please meet Sara, our brightest lawyer, and my nephew, Duncan. You must be Jim.”
“Yes.”
“How can we help?”
“Like a lot of my peers. I graduated from law school with a ton of debt. Some even left over from college. The firm where I work treats me well. Pays fairly. No complaint. But I have to live. I need to get that debt off my back.”
Duncan and Sara nodded and spoke together. “We understand completely,” Sara added, “but for Macbeth’s extreme generosity, I’d be in the same boat.”
Duncan responded, “For sure.”
“Not looking for a hand-out. Just some advice.”
Macbeth picked up the conversation. “Tell us what you have in mind.”
“I work full time at the firm. Recently, a solo I met offered me a, shall we say, side gig.”
“What’s the deal?”
“I’d work on a few of her clients’ matters. Nights and weekends so it won’t interfere with my work at the firm. She’d pay me for the work I do. Besides, I’d learn a new area of law.”
Duncan asked. “Does your firm have a policy about working on matters outside the firm?”
“Not that I can find. I looked everywhere.”
Macbeth picked up the thread. “Your question to us concerns ethical issues if you accept this side gig, to use your term?”
“Exactly. I’d like to do it. For the money. But also the experience. They’d be basically my own clients.”
“Let’s start with some basics. Do you feel competent to take on clients in a new area of law? But on nights and weekends when we can assume the solo wouldn’t be around to answer questions or supervise or mentor your work?”
Jim pauses. “I guess so. Haven’t really thought about it.”
“Well, the competence rule means having the learning and skill to perform legal services with competence. Do you have the learning and skill in this new discipline? Certainly, something to consider.”
“Thanks. I’ll really have to talk to the solo who made the offer. About my ability to do the work.”
“Let’s talk about conflicts. If any client you serve in this side gig has a conflict with a client of your firm, that conflict will be imputed to every lawyer in the firm.”
“Okay”
“Could lead to disqualification. Perhaps worse. How will you check conflicts between the solo’s clients for whom you work and your firm’s clients?”
‘Well, the work is so different, I don’t see how conflicts could arise. I mean, the firm does complex business litigation. The solo’s practice is family law.”
Sara interrupted. “Executives have family law issues. Don’t you still have to run conflict searches?”
Duncan followed up. “I think its mandatory.”
Macbeth nodded. “I agree.”
“Okay. I’ll figure out how to do that.”
“Let’s stop there. Did you intend to tell your firm about this side gig, as you call it?”
“Not really. I mean, I’ll still work hard every business day. This is just nights and weekends.”
“You recognize that the solo’s clients’ identities are confidential information? You can’t disclose them without their informed consent.”
“Really? Okay.”
“The same with the firm’s clients’ identities.”
“Okay. Hadn’t really thought much about it.”
“I think that may raise a real obstacle for doing conflict searches both at the solo’s practice and the firm’s.”
Sara asked: “How will the solo pay you?”
“She said I’d get a percentage of the fees from the clients I work for.”
“That appears to raise a fee-sharing issue. You’ll need the client’s informed consent.”
Macbeth picked up the discussion. “I’m bothered about not telling your firm. I’m not an employment law expert. But just from an ethics point of view. If your side gig is material. I think it is. Then its non-disclosure could be considered dishonesty. You don’t want that.”
“No!”
“Besides, your firm’s management has an obligation to have policies to make sure you comply with the rules and State Bar Act. Without knowing about your side gig, I’m not sure how they can do it. Seems to put them in a bind.”
“I see your point.”
Will that kill the side gig?”
“Not sure.”
“There are some more issues to think about. But let’s wait until you discuss this with your firm. If you’re able to move forward, we can talk again.”
“I really appreciate your taking the time to talk to me. I’ve learned a lot.”
“That’s why we’re here, Jim. We’re here to help, whenever you might need it.
Editorial Note: Rules of Professional Conduct to which MacBeth ‘s team referred include: rule 1.1 (competence); rule 1.7 (conflicts); rule 1.10 (imputation of conflicts); rule 1.6 and Bus. & Prof. Code section 6068, subdivision (e) (confidentiality); and rule 8.4(c) (misconduct/ dishonesty, deceit).