Stories Behind The Severances
Lawyers, paralegals adjust course after layoffs
By DOUGLAS S. MALAN
Michael Wallace starts every morning logging on to his computer and searching the Internet for job opportunities. He sends out e-mails and networks with people he knows.
It’s been that way since January when he was laid off as one of Pepe & Hazard’s senior-level paralegals supporting the firm’s global construction litigation practice.
And what he finds is not encouraging.
“There’s really not much out there,” said Wallace, former president of a statewide paralegal association. “I’m constantly looking online and in the paper [for a job]. I’ve given up just looking for a paralegal position. I’d take anything.”
That includes a position at Home Depot, where he recently submitted an application.
Wallace, who is 60 years old, lives with his wife Donna in Lebanon and spent 10 years as a paralegal at Pepe & Hazard.
He became part of a sobering trend as law firms continue to cut attorneys and support staff by the thousands on a weekly basis. From February 2008 to February 2009, the legal industry lost 21,000 jobs, Connecticut firms such as Day Pitney, Robinson & Cole, Wiggin and Dana, Shipman & Goodwin and Pepe & Hazard all have announced layoffs this year. Meanwhile, the overall unemployment rate is hovering around 8.5 percent, complicating attempts by Wallace and three attorneys profiled below to get back in the workforce.
Wallace got into the legal industry after suffering a debilitating back injury in 1993 after decades of truck driving. He was on disability for a couple of years before getting retrained as a paralegal.
“If worse comes to worse, I could start driving again even though I’m not supposed to,” Wallace said. “But you have to put food on your table and pay your mortgage.”
Pepe & Hazard provided Wallace a 10-week severance package, and he starts drawing unemployment on April 6. Meanwhile, he cashed in his 401(k) to keep up with the bills and medical expenses.
The Wallaces have considered moving to Florida where their youngest son lives, and Michael has sent résumés to companies down there but hasn’t heard anything.
Donna’s bookkeeping business is keeping the household going at the moment, and Wallace is filling out paperwork to take advantage of a federal health insurance subsidy that pays 65 percent of costs for unemployed workers covered under COBRA. That knocks his monthly health insurance payments down from $800 to about $280.
“I try not to get too stressed about it, but it sure would be nice to have a job,” Wallace said. “It’s worse than I’ve ever seen it. I sat in lines during the oil embargo [of the 1970s] and this is worse than that. At least we had a job then. But we always bounce back, and that’s what you’ve got to hope for.
“I tell you what, my dog loves it. He thinks it’s great because I’m here every day.”
Enormous Pressure
When the checks stopped coming, reality set in for Joanne Rapuano.
Her law firm’s leader, Marc Dreier, was arrested in Canada in December and soon his scheme of selling hundred of millions of dollars in phony promissory notes started to unravel.
In Dreier’s Stamford office, Rapuano and her colleagues were scrambling for their livelihoods. Insurance benefits were cut off with their salaries for the last two weeks of December. Eventually, Rapuano, a commercial litigation associate, was left unemployed.
For two months, she navigated the job market, elbowing her way through a growing crowd of laid-off lawyers fighting for jobs and the attention of legal recruiters.
She was living in Stratford on $500 a week in unemployment and caring for two elderly parents. With no job prospects and weeks passing, she had to deal with financial problems while losing her identity as an active lawyer.
“The pressure is enormous for someone who went to law school and has a history of good-paying jobs,” said Rapuano, who was an in-house lawyer at Purdue Pharma LP before joining Dreier. “You get in a weird funk and you don’t feel like you’re part of society. It’s so depressing and lonely.”
In early February, she joined Shepro & Blake, a nine-lawyer Stratford firm that handles legal matters ranging from real estate closings to business litigation and family law. Rapuano said her litigation background helped her stand out in a large pool of candidates.
“There are so few jobs that I had to practice law outside of my comfort zone,” said Rapuano, who is working on foreclosure, bankruptcy, family law and workers’ comp cases. “You have to be that flexible. I am one of the lucky ones, fortunate that I landed at Shepro & Blake.”
But she’s not completely out of the clear. Her two months spent unemployed caused her to miss some credit card payments. “The credit card companies are relentless,” she said. “After making payments for so many years, they ruined my credit. It was like all of those years didn’t matter.”
Rapuano also is looking at a second job to help bridge the gap between her salary at Dreier and Shepro & Blake. “I may have to pick up a waitressing job at night on the weekends to supplement my income,” she said.
‘Pursuing Every Avenue’
Matthew McGrath has learned that the best way to cope with his layoff is to not say “no.” Whether it’s incoming cases, teaching opportunities or anything that could bring in money for his family, he has expanded his reach.
“It’s scary at first,” McGrath said. “At times, it’s worrisome because you’re not sure if you can bring in the money you’ve been bringing in and it forces you to get creative.”
McGrath was handling real estate financing and lending work for clients such as Credit Suisse, Merrill Lynch and UBS while an attorney at Thelen’s Hartford office. Then suddenly, the work stopped coming in and attorneys knew layoffs were coming.
McGrath was laid off last spring, several months before the firm dissolved. Initially, he was searching for another law firm job and using his severance package to pay the bills. But last summer, the contracting job market changed his thinking.
“I was realizing that it was very unlikely that I’d get the same kind of job that I had in the past,” said McGrath, who has a child in college and two others in private school. “I was coming to grips with that and realizing that I had to do something to make money.”
So like a lot of lawyers laid off in this economy, McGrath went solo and was able to keep some strong clients whose legal needs vary from month to month. He started picking up legal matters that didn’t bring in enough money at Thelen, such as real estate closings, trusts and estate work, and small business formation.
McGrath also landed a teaching position at Central Connecticut State University this semester in a business law class, and his wife has done less volunteering and more work for pay. McGrath hasn’t stopped looking for a job. He scours web sites and applies for legal positions that fit his background.
“It seems like there are fewer jobs all the time, even compared to just a couple of months ago,” McGrath said. “I’m pursuing every avenue and taking as much teaching as I can. Some months are weak and some are good and you keep moving.”
Internal Value
Dina Tolia talks to recruiters about jobs and she’s constantly told to just wait.
A commercial real estate attorney, Tolia left Paul, Hastings, Janofsky & Walker after 10 years when that firm departed Stamford in November 2007. She joined Dreier’s Stamford office shortly thereafter and was a victim of that firm’s collapse late last year.
Like many former Dreier lawyers, Tolia says there’s a lot of anger about how their careers were suddenly derailed. But after being unemployed for several months, Tolia is forcing herself to look forward instead of back. “I have been looking at alternative career paths,” Tolia said. “I don’t see the market for my type of work changing before the end of the year.”
Tolia has been told that she has too much experience for the legal jobs she’s applied for, and she’s now considering jobs in human resources, with non-profits and even legal positions at the United Nations. She’ll take “whatever I can find that I’m suited to.”
Tolia’s husband remains employed and the family, which includes the couple’s 7-year-old son, has insurance coverage. However, “the pressure of not having a second income is certainly there,” Tolia said, noting that she has laid off her full-time nanny.
The family has taken a hard look at their disposable income and has changed its perspective on what they need and don’t need. They search for local entertainment options and vacations are put on hold.
When her son is off at school, Tolia spends her time polishing her résumé and looking for work. Being unemployed “definitely affects you psychologically,” she said. “No matter what anyone says, you get satisfaction from working on and closing deals. A person internally values themselves based on what they can do and achieve as an attorney.”•
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