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Sep 09, 2026

Law Firm Associate Recruiting and Retention Strategies in a Sole Owner Firm

Question:

I am the sole owner of a general practice firm in Indianapolis, Indiana. I have been in practice for 45 years and I am the only lawyer in the firm. I have a receptionist and a paralegal that also serves as my office manager and bookkeeper. I have tried hiring associates over the years, several times, but after spending time training them they eventually go elsewhere. I would like to reduce my workload and eventually retire. How should I approach finding and keeping an associate differently? Thank you for any ideas that you may have.

Response: 

This is a common and a major challenge for sole practitioners and small-firm owners. The mistake many owners make is viewing the associate primarily as someone who will help the owner get the work done. If you are approaching retirement, I would encourage you to look at the issue differently. Your next associate may not simply be an employee. He or she may be your future successor. This changes the recruiting, compensation, training, management, and retention equation.

I am sure that the turnover that you have experienced has been frustrating. Your reaction may be “Why should I spend the time and money training another associate if he or she is just going to leave?” Your problem may not be that you have failed to find good associates. You may have failed to give good associates a compelling reason to stay.

I suggest that you think about and ask yourself the following questions:

Question 1: Why are your associates leaving?

Determine why lawyers are leaving. Do not assume the answer is compensation. It may be. But associates also leave because they don’t see a future with the firm. After two or three years, the associate may be asking:

If the associate cannot answer these questions, the lawyer may reasonably begin looking elsewhere. You need to stop thinking about retention as how do you keep this associate from leaving and think in terms of what kind of future you can offer this associate?

Question 2: Should you Pay Higher Salaries?

You should pay competitively. You cannot expect to retain talented lawyers if your compensation is substantially below the market. But simply increasing compensation every time an associate receives an outside offer is not a retention strategy. You should develop a total compensation and career advancement program. Such a program might include:

The last item may be particularly important. Since you eventually want to retire, the opportunity to become a partner—and potentially the owner of the practice—may be worth considerably more to the right lawyer than another few thousand dollars of annual salary.

Question 3: Does the Associate Even Want to Become a Partner?

Thirty years ago, I would never have to ask an associate during an interview if they wanted to become a partner or own a law firm as everyone would have said yes. This is no longer the case. Not every good associate wants to become an owner. Some lawyers want a long-term professional position without ownership responsibilities. Others may want partnership but not equity ownership. The important thing is to find out. Ask, what does your ideal career look like five years from now? You may discover that the associate’s goals and the firm’s goals are highly compatible. Or you may discover that they aren’t.

Question 4: Should You Tell the Associate That You Eventually Want to Retire to retire? 

If retirement is reasonably foreseeable, I believe you should begin discussing the firm’s future. You don’t necessarily need to say that you are retiring in three years if you haven’t made that decision. However, you should be able to say that you are building this firm for the long term, and you want to develop lawyers who can assume increasing responsibility and potentially participate in ownership. This discussion can be extremely important. Associates are more likely to invest themselves in the firm if they understand that there is a future opportunity.

Question 5: Should you Involve the Associate in Management?

Yes—but progressively. An associate who may eventually become a partner or successor needs to understand that a law firm is a business as well as a professional practice. Over time, expose the associate to:

You don’t need to give an associate full access to everything immediately. But if you expect the lawyer eventually to help run the firm, you need to begin developing management capability well before the transition.

Final Thoughts

If you are a sole owner approaching retirement, I would encourage you to look at recruiting and retention differently. Don’t ask only how can you find a good associate – ask – how can you find, develop, and retain the lawyer who could eventually become the next leader of your firm? The answer to this question changes the entire strategy and you will begin thinking about succession much earlier. The ultimate objective isn’t simply to retain an associate for another year. It is to create a professional environment in which a talented lawyer can say – I can see my future here.

If you don’t develop a successor, you may eventually find yourself with:

The solution isn’t to avoid developing people, it is to develop them within a deliberate succession strategy. One of the biggest mistakes I see is sole owners waiting too long. A successful succession often requires several years. The owner must have time to:

In todays competitive market for talent you may find that you are unsuccessful in finding, hiring, and retaining an associate that is able or willing to be your successor. I am finding this to be the case with many sole-owner firms. In these situations, an external strategy such as merger or an Of Counsel relationship with another lawyer or firm is the course taken.

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John W. Olmstead, MBA, Ph.D, CMC

Sep 02, 2026

Law Firm Management – What is Keeping Law Firm Owners and Managing Partners Awake at Night

Question:

I am the managing partner of a ten lawyer firm in Kansas City, Missouri. There are five partners and five associates in the firm. We are an insurance defense firm and our clients are a handful of insurance companies. Our cases are primarily slip and fall, premises liability, and auto accident cases. I have been the managing partner for two years and frankly I am getting burned out on the position and none of the other partners want the job. I am working 60-70 hours a week and am spending so much time on administrative matters that I don’t have time to practice law. I would be interested in what is keeping managing partners in other insurance defense law firms awake at night and how they are dealing with the challenges.

Response: 

Managing partners in small insurance defense firms are telling me that the following top five challenges and concerns are what are keeping them up at night:

1.Finding and Retaining Experienced Lawyers and Staff

This is the biggest issue facing many firms. Gone are the days when you could place an ad and have a position filled within 30 days. I have client law firms that it has taken over a year to find and hire experienced (3-5 years) lawyers.  Billable hour requirements of 1800 – 2000 hours are conflicting with work life balance goals of many young lawyers. Retention is also a issue. Losing a strong partner or associate can mean lost revenue, disrupted client relationships, and months of recruiting and training.

You must plan on a longer recruiting timeline and use all avenues available to you. For example:

You must offer competitive benefits, work life balance and flexibility. Some form of remote work has become a major requirement and failure to offer schedule flexibility and remote work has resulted in  many law firms losing candidates to other law firms.

2.  Client Concentration 

Insurance defense firms often have too few clients and many insurance defense firms are held hostage by these clients. I have some law firm clients that only have one insurance company client and if that client were to start using another law firm the law firm would be in dire straights. The client controls the amount of case assignments that the firm receives, the bill rate, and the amount of hours that can be charged for various tasks. The firm is so busy working on client files that no one has time to market and try to get additional clients. Partners often know they need a more predictable pipeline but don’t have time—or a repeatable system—for generating new clients. It sounds like your firm depends heavily on a handful of clients. Losing one major insurance company client can materially change the firm’s economics.

Insurance defense firms must find ways to invest the time and other resources to add additional clients to their client roster resulting in less dependence on one or a few clients and move their practice up market with improved hourly rates in areas such as insurance coverage, corporate representation, and self insured clients. Such diversification has made many firms less dependent on 2000 plus billable hours and more attractive you new lawyers.  Many insurance defense firms have effectively done this.

3.  Cash Flow and Collections

It has often been said that businesses are killed by inadequate cash flow. A firm maybe profitable on the profit and loss statement but is cash always tight?” Slow-paying clients, write-offs, uneven matter flow, and payroll/overhead create constant pressure.

4. Technology and AI

Law firms are trying to figure out where AI can genuinely improve operations and lower operational overhead without creating confidentiality, accuracy, ethics, cybersecurity, or malpractice risks. What tools should the firm be using? Costs? Time to implement? Fear of AI reducing the need for lawyers?

You need to attend all the CLE seminars, webinars, etc. that you can and get up to date on AI. This is moving very fast.

5. Succession Planning

What happens when founding partners want to slow down and retire?” How does the firm fund buyouts? Smaller firms frequently have fewer obvious successors. Do the younger attorneys in the firm want to have equity and own a law firm and will they be willing to step forward?

You need to begin addressing this sooner than later. Our blog library has an entire section on this topic.

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John W. Olmstead, MBA, Ph.D, CMC

 

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