Clifford Chance Cuts 10% of Back-Office Staff as AI Transforms Legal Services

Clifford Chance cites AI as it axes 10 per cent of back-office staff

Law firm Clifford Chance is cutting about 10 per cent of its business services staff in London, pointing to increased use of artificial intelligence as one reason for the job losses. Roughly 550 employees, in areas including finance, HR and IT, were told last month about plans to make some 50 jobs redundant and to bring in role changes for up to 35 others, according to people with knowledge of the details. The elite firm, where partners earned an average of £2.1mn in the past financial year, told staff that greater use of AI and reduced demand for some business services meant that it needed to cut jobs, the people said. It also cited more work being done at hubs in Poland and India as a reason for the cuts. Clifford Chance opened an operations hub in Warsaw last year. It also has a business support hub in Newcastle. The job cuts come as law firms are under pressure from clients to demonstrate what efficiencies they are making through using AI. Most big law firms have either started using legal tech from companies such as Harvey or Legora, or created their own in-house tools, as they look for ways to automate more mundane tasks. However, back-office staff at Clifford Chance are sceptical that its AI tools are good enough to replace human workers, one of the people said, stating that the redundancies had come as a surprise given the firm's strong financial performance last year. Staff are also unhappy that the job cuts have been announced in the run-up to Christmas, the person said. Employees have been told that the redundancies will not take effect before January. Clifford Chance said: "In line with our strategy to strengthen our operations, we can confirm we are proposing changes to some of our London-based business professional functions. The proposed changes could see the creation of new roles, changes to the scope of roles, revised team structures and in some cases a reduction in roles." Law firm Bryan Cave Leighton Paisner made similar job cuts earlier this year, reducing its global business services workforce by about 8 per cent. BCLP also cited the increased use of technology as one of the reasons for reducing staff.

Increased AI use leads law firm to cut finance, HR and IT roles in London by 10%

Clifford Chance to cut jobs in business services and transfer some work to countries such as Poland and India, FT reports The law firm Clifford Chance is reducing the number of business services staff at its London base by 10%, with the increased use of artificial intelligence a factor behind the decision. The head of PwC has also indicated that AI may lead to fewer workers being hired at the accountancy and consulting group. Clifford Chance, one of the largest international law firms, is making about 50 roles redundant in areas such as finance, HR and IT with role changes for up to 35 other jobs, according to the Financial Times, which first reported the cuts. Greater use of AI and reduced demand for some business services are behind the cuts, the FT report said, as well as more work being done at offices outside Clifford Chance's main UK-US operations, in countries such as Poland and India. A spokesperson for Clifford Chance said: "In line with our strategy to strengthen our operations, we can confirm we are proposing changes to some of our London-based business professional functions. "The proposed changes could see the creation of new roles, changes to the scope of roles, revised team structures and in some cases a reduction in roles." White-collar, or office-based jobs, are commonly cited as being vulnerable to advances in AI, the term for computer systems that perform cognitive tasks typically associated with human intelligence. AI is able to help employees perform some tasks faster - such as coding, research, scheduling meetings and reviewing contracts - and experts believe that companies will consider banking those productivity gains by hiring fewer people, or cutting staff numbers as systems become capable of handling certain tasks autonomously. Four in 10 (41%) bosses told a recent survey of 850 business leaders that AI was allowing them to cut the number of employees. The British Standards Institution poll spanned seven countries: the UK, the US, France, Germany, Australia, China and Japan. The global chairman of PwC, Mohamed Kande, said the firm would no longer be hiring 100,000 people over a five-year period - a target set in 2021 - because of the advent of AI, indicating that entry-level jobs could be affected. "When we made the plans to hire that many people, the world looked very, very different," he told the BBC. "Now we have artificial intelligence. We want to hire, but I don't know if it's going to be the same level of people that we hire - it will be a different set of people." However, Kande added that PwC was struggling to recruit AI specialists. "We are looking for hundreds and hundreds of engineers today to help us drive our AI agenda, but we just cannot find them," he said. The UK head of PwC said in September that AI was "certainly reshaping roles" but that a drop in graduate recruitment at the firm this year was due to a slowdown in economic activity.