|
|
Stmt to NJ Supreme Court |
||||||||||||||||||
|
|||||||||||||||||||
|
| ||||||||||||||||||||||||
3. "No rational basis exists for the disparate way in which Advisory Opinion No. 24 treats employed and independent paralegals. The testimony overwhelmingly indicates that independent paralegals were subject to direct supervision by attorneys and were sensitive to potential conflicts of interests." - New Jersey Supreme Court Opinion In Re Opinion No. 24 of the Committee on the Unauthorized Practice of Law.3. "No rational basis exists for the disparate way in which Advisory Opinion No. 24 treats employed and independent paralegals. The testimony overwhelmingly indicates that independent paralegals were subject to direct supervision by attorneys and were sensitive to potential conflicts of interests." - New Jersey Supreme Court Opinion In Re Opinion No. 24 of the Committee on the Unauthorized Practice of Law. When the New Jersey Committee on the Unauthorized Practice of Law issued Opinion No. 24 the Supreme Court and those interested in the issue carefully studied whether there is such a vast difference in the professional responsibilities and duties of legal assistants who are employed by law firms or corporations and legal assistants who contract their work to attorneys ("independent paralegals") that they should be considered as two separate classes of paraprofessionals. In the Supreme Court's opinion, there is no rational basis for the disparate way in which Opinion No. 24 treated employed and independent paralegals. Although independent paralegals may have a greater potential for conflicts, the risk is not essentially different from that experienced by paralegals who change jobs. Further, as paraprofessionals who work solely under the supervision of attorneys, independent paralegals were not found to be engaged in the practice of law. The Supreme Court also recognized that:
The Court's findings of its review of Opinion No. 24 recognized that additional regulations and guidelines need to be established to further clarify the role of legal assistants in the practice of law and suggested consideration to be given to regulations to address the problems that the work practices of all paralegals may create. The Court's suggestion included regulations concerning conflicts of interest and any concerns resulting from paralegals sending correspondence directly to clients without attorney review and approval. The apparent question which the Court sought to address is what constitutes proper supervision by attorneys of the nonlawyer employees and contractors with whom they work. It is respectfully submitted that because the Supreme Court has jurisdiction over the admission to the practice of law and the discipline of persons admitted to practice, any regulations suggested by the Committee would necessarily relate to those who are subject to Supreme Court regulation - New Jersey attorneys. The Committee's report and proposal assumes that the New Jersey Supreme Court has jurisdiction to license nonlawyers, although the report does not state any specific basis for this assumption. Even if the New Jersey Supreme Court has jurisdiction to mandate an independent licensing mechanism for nonlawyers, a separate but related issue is whether the Supreme Court should exercise its authority in the manner proposed by the Committee. Another issue related to this discussion involves members of other professions who may be performing paralegal work. Many professional duties of those within other occupations may relate to either the practice of law or to duties and responsibilities of paralegals. 3 For example, In Re Opinion No. 26 of the Committee on the Unauthorized Practice of Law, the Supreme Court was presented with the question as to whether the real estate closing practice in South Jersey, which consists largely of closings in which neither the buyer nor the seller is represented by counsel, constitutes the unauthorized practice of law. In this instance the Court determined that:
The above quote, along with the question presented by opinion No. 26, is interesting to this entire discussion. First, in recognizing that some professions skirt and may overlap the practice of law, a question arises as to whether the licensure of legal assistants would also include regulation of those in other occupations who may be performing paralegal duties. Secondly, the Court's statement that the public interest is the determinent factor in questions such as this is central to the issue of licensure of paralegals. 4. A licensure mechanism must be developed in response to a demonstrated need; based upon objective, quantifiable research; and must serve the public interest. By their very nature, licensure mechanisms are designed to protect the health, safety, and well-being of citizens. 4 Licensure mechanisms are, for the most part, established by governments through their legislative bodies to serve the public interest. In New Jersey, for example, the legislature has established 33 boards which regulate the activities of 60 professions and occupations; 600,000 New Jersey citizens are regulated by these boards which range from medicine, dentistry and nursing to plumbing, psychological counseling and engineering. A licensure mechanism is appropriate in instances where the public may be harmed by incompetent products or services. 5 In connection with this report, the Committee has not demonstrated a public need for the licensure of paralegals. Rather, the Committee's report focuses solely on the relationship between the legal assistant and the attorney/employer and the regulation of those who are admitted to the practice of law. It may be assumed that the Committee's ultimate interest is the safety and well-being of citizens of New Jersey. However, this does not appear to be the driving force of the Committee's recommendations. The Committee's licensure recommendation sets forth a complicated system of plenary licenses and restricted licenses, divides the paralegal profession into two groups based on conditions of employment, although there is no rational basis for this segmentation, and classifies paralegals according to their education and experience. Among the elements basic to a licensing mechanism is the definition of the profession which it regulates. The Committee's approach to defining the career field into separate segments has no basis, particularly when these segmented groups have identical duties and responsibilities. It is critical that any licensing or professional certification program must relate to and reflect real-world situations. Professional licensing mechanisms are designed to protect the public and to control entry into an occupation. Licensing mechanisms are not aspirational goals that may be adopted by those within the profession nor can they serve to strong-arm the growth and development of a career field. The Committee's report and recommendations with regard to a licensing mechanism seem to dismiss the present day realities of the practice of law and the paralegal occupation. No occupational research is offered to substantiate the Committee's fragmentation of the career field or creation of the admission requirements. In fact, while the Committee estimates there are approximately 1,000 paralegals in New Jersey, a recent article in the New Jersey Lawyer states that in 1996 there were approximately 3,600 paralegals according to the latest data from the State Department of Labor's occupational survey. 6 Occupational research is fundamental to the development of a licensing mechanism. 7 Attached to this statement is a copy of the 1997 National Utilization and Compensation Survey Report of the National Association of Legal Assistants for the Court's review. 8 The report shows that approximately 41% percent of those employed as paralegals have received a bachelor's degree; 29% report a high school diploma as their highest level of general education. The data describing participation in legal assistant educational programs show that 30% have received an associate degree; 19% have received an undergraduate certificate; 16% have received a post baccalaureate certificate; 22% report they have not completed a legal assistant educational program. Interestingly, those who report completion of high school as their highest level of general education have been employed longer with the current employer and have more years of experience than all other legal assistants. Further, years of experience and years on the current job are statistically significant factors related to compensation and billing rates. This finding clearly demonstrates that, as a practical matter, law firms recognize the value of the experience of their nonlawyer employees. As a matter of fact, the level of general education was not found to be statistically significant at all to salary and compensation levels, and barely significant to billing rates. In contrast, the licensure mechanism proposed by the Committee prohibits qualification for employment as a paralegal on the basis of years of experience alone, and further segments those who are employed as paralegals and have a bachelor's degree in any field and only in-house paralegal training. This latter group of paralegals may only seek employment with law offices; they are not eligible for employment as paralegals in corporations, government, or on a contract basis. Also, with regard to this class of employees, the licensing scheme prescribes the number of paralegals a law firm may employ with this qualification and by whom they are supervised. Finally, the licensing mechanism prohibits qualification and employment of paralegals by virtue of years of experience after three years of the rule's inception. 9 It is respectfully submitted that a majority of those currently employed as paralegals in New Jersey have achieved their positions by virtue of experience and in-house training. The restricted license proposed by the committee is contemptuous of all in-house training for legal assistants; yet in-house training of competent individuals is a time-honored method of training for legal assistants. To reject this method of instruction by relegating it to the restricted license category is an affront to every legal assistant who is trained in this manner as well as to the lawyers who have educated and supervised them through the years. The requirements for a plenary license do not consider in-house training as a viable means of qualification as legal assistant; yet the committee proposes that a person can meet the threshold educational requirements by earning 60 college credits from an accredited four-year institution in any field plus a certificate from an ABA-approved training program. Thus, someone with 60 hours of college credits in animal husbandry and a certificate may qualify for the license; one with over ten years of experience and in-house training as a paralegal does not qualify. The licensing scheme advanced by the Committee is filled with similar contradictions, restrictions on attorneys’ practices, and arbitrary lines in the sand. An interesting aspect of the Committee's recommendation and qualifications for the license is its reliance on and endorsement of the American Bar Association’s school approval process for legal assistant programs. The National Association of Legal Assistants supports this process and funds a seat on the ABA School Approval Commission. Also, graduates of ABA approved schools may qualify for NALA membership and may qualify to sit for the CLA examination. It is the position of NALA, however, that the Committee's reliance on ABA approved schools as the sole provider of paralegal education is not based on fact nor substantiated by research, and places and undue burden on schools and students. This proposal is certainly anti-competitive in that it prevents the creation of any new programs for paralegal education after the adoption of the rules. To be licensed as a paralegal in New Jersey, a person must have graduated from an ABA approved program or from a program that has applied for ABA approval and receives it within two years of the individual's application. However, a program cannot apply for ABA approval until it has graduated its first class. This takes approximately two years; thus, the program's first graduates can never apply for licenses as paralegals in New Jersey. In practical terms, this means that no one considering a career as a legal assistant would want to be among the first graduating class of any program, no matter how qualified its curriculum, because the graduate could not get a job and there is no guarantee the program would be ABA approved. Further, by the adoption of the ABA school approval process as the sole means of paralegal education, there is an implied assumption that all the graduates of an ABA approved program are qualified to begin work as a legal assistant. Marginal students graduate from ABA approved degree programs, just as marginal students graduate from all degree programs. Finally, this proposal would effectively cause paralegal programs in New Jersey that are not ABA approved to go out of business when, in fact, some programs cannot qualify for ABA approval for reasons extraneous to paralegal curriculum. These reasons include cost and the competing requirements of the ABA and marketplace realities. Many educators believe the ABA’s curricula requirements are nearly ten years behind the times and, for this reason, have chosen not to seek the ABA credential. It is respectfully submitted that the Committee's report and recommendations could cause public harm by arbitrarily defining those citizens who may or may not qualify for employment as a paralegal and by unnecessarily restricting the delivery of paralegal education. 5. It is respectfully submitted that this report and recommendations could cause public harm by unnecessarily increasing the cost of legal services to consumers and eliminating the benefits of the utilization of nonlawyers in the delivery of legal services. The curious aspect of this licensing mechanism is really quite simple: Why would an elaborate system of licensing be created, and why would individuals subject themselves to it, if the license does not grant the person any rights or permission to do something? Generally, licensing mechanisms are helpful to the public because they provide information to consumers that assists them in judging the value of a product or service. In this instance, however, the license provides no information to the consumer. With reference to someone interested in becoming a legal assistant, it appears that the sole purpose for seeking licensure is to be able to use the title "paralegal" or "legal assistant" in their work environment. In this proposal, the license does not control one's work product. In fact, any lawyer or nonlawyer could perform paralegal duties in the law office. We suggest this is exactly how firms will respond to this burdensome regulatory scheme. The licensing of paralegals through this system does not increase the efficiency of delivery of legal services nor reduce the cost. It does not streamline the practice of law by allowing paralegals to perform functions generally reserved for attorneys. On the contrary, it adds substantially to the cost of legal services through direct costs, such as licensing fees, and indirect costs related to the methods by which firms supervise the services of paralegals. For example, under the restricted license category a law firm may not employ more than one in-house trained paralegal for each one to 10 lawyers, the supervising lawyer of in-house trained paralegals must have been admitted to practice for at least five years, and a supervising lawyer may supervise no more than one restricted licensed paralegal at any given time. With regard to definition and licensing of contract paralegals, the procedure severely limits the number of contract paralegals who are qualified for the license and certainly prohibits any growth in numbers of those who offer their services in this fashion. This has the potential of unfairly prejudicing the sole practitioner. The sole practitioner or small firm practitioner who cannot afford to hire a full-time legal assistant has two options in terms of handling routine work: (1) utilizing independent legal assistants on a per case basis as needed while properly supervising the work product, or (2) performing these tasks him/herself. Since the licensing mechanism does not encourage the growth of contract paralegals and severely reduces the numbers of those who may offer these services, the sole practitioner would have no choice but to perform the paralegal tasks. It is inevitable, then, that either the attorney or the client will unjustly bear a heavy financial loss for time spent by the attorney on routine matters. 10 Other indirect costs associated with the licensing mechanism would include the cost of separate malpractice insurance for paralegals as licensed individuals. The Committee states that attorneys should be absolved of primary responsibility for ethical violations committed by a paralegal if the breach of conduct is outside the attorney's control. It goes on to state that legal assistants must be independently responsible for breaches of conduct and subject to discipline. Thus the need for malpractice insurance, which would be exceptionally costly considering the numbers of individuals involved. The final cost category associated with this mechanism is the cost to the public not only in terms of increased cost of legal services but also in terms of the public funds required for initial and on-going capitalization of the program. While the report includes an estimated budget for the first year of operation, from NALA's 20+ years of experience with the Certified Legal Assistant credentialing program, the estimated cost appears low, particularly considering the complicated nature of the process. Compounding the administrative expenses, it is most likely a procedure such as this would be challenged in the courts. Clearly, the revenues generated by licensing and renewal fees cannot be depended upon to provide financial support for this process. First, the market is quite limited regardless of whether there are 1000 or 3600 paralegals in the state. Second, as pointed out earlier, there is no reason for one to seek a license as a paralegal. In summary, the cost of this program hits on all fronts: increased costs of legal services to the public, increased cost to those working as paralegals, and increased demand for public funds. Any cost-saving benefits related to the utilization of paralegals in the delivery of legal services will be lost and replaced with rising costs. 6. Professional associations offer viable alternatives to governmental regulation. The Committee's report focuses primarily on the development of a system of governmental or judicial regulation of members of an occupation that is already regulated by the license of the employers. The proposed licensing mechanism for paralegals includes completion of a written examination covering a code of professional conduct for paralegals that is, for the most part, simply a restatement of the attorneys’ code. The recommendation to establish a licensing procedure is offered at a time when governments are overburdened and the term "deregulation" is loudly spoken. At the end of 1980, it was estimated that federal regulations cost Americans over 1 billion dollars a year. A typical family of four paid an extra $1,800 annually for goods and services simply because excessive federal regulations added to the cost of these goods and services. 11 Against this backdrop, one begins to question the purpose of the paralegal license. Because the license does not allow a paralegal to perform any functions that he or she does not perform already, one must surmise the purpose of the license is to identify paralegals within the state, and to discipline paralegals for violation of a code of professional conduct to which they are already committed and must follow to retain their employment. We submit the mechanism described is not a licensing procedure but a registration procedure. Other mechanisms already exist in New Jersey that would serve this purpose. For example, since 1989 the New Jersey State Bar Association has permitted paralegals who meet their membership requirements to join the association. This process could easily be transformed into a system of registration. In addition, no consideration is given to the important role played by professional associations in this arena. In addition to the New Jersey State Bar Association, the Legal Assistants Association of New Jersey, established in 1982, also provides professional development programs for paralegals, has established a code of ethics and professional responsibility for paralegals, and, through its membership requirements, has established standards for entry into the field. 12 The valuable role professional associations play in the area of credentialing and self-regulation has long been recognized in our society. Self-regulation, defined as a process whereby an interorganizational network (such as a trade association, professional society, or other third party) sets and enforces standards relating to the conduct of firms and/or individuals in an industry or profession, 13 is one of the highest and best traditions in American society, and is a fundamental goal of virtually every individual professional. Self-regulatory programs are usually voluntary programs and are subject to the control by the marketplace, by the value of the standards which they promulgate, and by governmental regulation. In summary:
Summary Like the Supreme Court Committee on Paralegal Education and Regulation, the National Association of Legal Assistants is vitally concerned that those within the paralegal profession adhere to stringent standards of conduct and ethics. The legal profession is built solely on a foundation of trust and adherence to a code of professional conduct by paralegals is the most crucial element in the growth and acceptance of this career field. However, governments and associations can only deal with an individual's actions. Licensing procedures control entry into an occupation or profession; they do not ensure ethical behavior. A licensing procedure will not change the actions and attitudes of those who are unscrupulous in our society. For example, those individuals who call themselves paralegals and deliver services directly to the public seem to pay little attention to unauthorized practice of law statutes. The Committee's report is important to the development of the career field by initiating these discussions and examining the purposes and impact of licensing mechanisms. We respectfully submit, however, that it is the attorney who maintains the supervision of nonlawyer personnel and who is solely responsible for their conduct. The guidelines and rules presented under recommendation No. 6 provide helpful information to attorneys regarding their utilization of paralegals and other non-lawyers in the delivery of legal services. Respectfully submitted, Vicki Voisin, CLAS 1 See amicus brief and appendix filed by the National Association of Legal Assistants In Re Opinion No. 24 of The Committee on the Unauthorized Practice of Law. March 21, 1991. 2 For a more detailed discussion of the way different states have defined the terms "paralegal" and "legal assistant," see Summary of Definitions of Terms: Legal Assistant and Paralegal, National Association of Legal Assistants, June 1998, which may be found in the appendix. 3 There is a renewed interest in this issue throughout the legal community, particularly with the passage of the Internal Revenue Service reform bill which extends the traditional lawyer-client privilege to cover some communications between taxpayers and their accountants. On August 4, 1998, the ABA President appointed a Commission on Multidisciplinary Practice to study and report on the manner and extent to which nonlawyer professional service firms are seeking to provide legal services. See "ABA President Creates Commission To Review Multidisciplinary Practice Issues," ABA-BNA Lawyers’ Manual on Professional Conduct, Vol. 14, No. 15, P 390. August 19, 1998. 4 "Essentially, there are three forms of individual credentialing - licensing, certification, and registration. . . . Licensure is the most restrictive of the three forms of credentialing and generally refers to the mandatory governmental requirement necessary to practice in a particular profession or occupation. . . . Licensure implies both practice protection and title protection, in that only individuals who hold the license are permitted to practice and to use a particular title. Certification, on the other hand, is usually a voluntary process instituted by a nongovernmental agency in which individuals are recognized for advanced knowledge and skill. . . . In some instances individuals who seek certification are ready hold a license. . . . Certification implies title protection as only those who are certified may use a particular title. The ultimate intent of licensure is to directly protect the public from incompetent practitioners. The intent of certification, on the other hand, normally is to inform the public that individuals who have achieved certification have demonstrated a particular degree of knowledge and skill. Its only potential direct method of public protection is through ethics enforcement. . . . Registration, also used for title protection, is normally a mandatory process that only requires individuals to apply for the title through the appropriate governmental or private agency. As such, registration is generally the least restrictive form of credentialing, most often used when public protection is less critical." See, Certification, A NOCA Handboook, National Organization for Competency Assurance, 1200 19th St. NW, #300, Washington, DC 20036-2422, 1996, P 3. 5 See Appendix E, "Issues Related to Licensure and Governmental Regulation of Paralegals," and "Summary of Review Criteria for Use In Determining Whether an Occupation or Profession Should be Licensed or Regulated by a State." These articles summarize sunrise legislation in other states. 6 7 NLJ 1818 (Monday, August 3, 1998) 7 The United States Supreme Court has addressed professional credentialing programs of associations on many occasions. Recently, in Peel v. Attorney Registration and Disciplinary Committee of Illinois, 110 S.Ct. 2281 (1990), in allowing an attorney’s use of a specialty credential available from a professional association, the Court suggested that a claim of certification is truthful and not misleading if:
The opinion of the Court is relevant to discussions of licensure mechanisms by further emphasizing the fact that the programs must be relevant and objective. 8 Since 1986, the National Association of Legal Assistants has conducted a national survey of the utilization and compensation of legal assistants on a bi-annual basis. The survey provides detailed information tracking the growth, duties, responsibilities, and compensation of legal assistants. This research is conducted by professionals in the field and offers reliable and valid national data. NALA’s 1988 National Utilization and Compensation Survey Report is referenced in the opinion of the United States Supreme Court in Missouri v. Jenkins, 491 U.S. 274, 289 n. 11, 109 S.Ct. 2463, 105 L.Ed. 2d 229 (1989). 9 A person who is employed full-time as a paralegal for two years at any time during the five years immediately preceding application for licensure and who successfully completes an ethics examination may qualify for a plenary license provided the person applies for license within three years after the effective date of the rule. Otherwise, the person does not qualify for any license. 10 According to information supplied by the New Jersey Office of Attorney Ethics, it may be estimated that "almost three-quarters of all law firms (74.25%) were single practice firms. Two person firms represented 11.97% of all private practice firms, while firms of between 3 to 5 comprised 8.70%. Only 5.08% of all of the law firms in New Jersey had 6 or more attorneys." 11 Certification and Accreditation Law Handbook, Jacobs, Jerald A., American Society of Association Executives, Washington, DC., 1992, P 9, quoting Carol E. Dinkins, U.S. Deputy Attorney General, "The Role of Self-Regulation in Regulatory Reform," in The White House Conference on Association Self-Regulation, 1984, 68. 12 The requirements for voting membership in the Legal Assistants of New Jersey are as follows: (1) Certification as a Certified Legal Assistant; or (2) Graduation from a legal assistant program that is approved by the American Bar Association; or (3) Graduation from a program that is institutionally accredited and includes not less than 60 semester hours of study of which 15 semester hours are substantive legal courses; or (4) Graduation from a legal assistant program which does not meet the above requirements plus 6 months of in-house training as a legal assistant; or (5) A bachelor’s degree in any field plus 6 months of in-house training as a legal assistant; or (6) Three-years law related experience under the supervision of a licensed attorney plus 6 months of in-house training as a legal assistant. 13 Current Principles and Practices in Association Self-Regulation, Lad, Lawrence J., DBA, American Society of Association Executives, 1992, P 45. 14 Certification and Accreditation Law Handbook, Jacobs, Jerald A., American Society of Association Executives, 1992, P. 9. -End- | |||||||||||||||||||
|
|
