Apr 25, 2012
Law Firm Partner Compensation – Why Change If We Are Happy
Question:
I am a partner in a 16 attorney firm in Memphis. Our firm has had the same partner compensation system for 20 years and we are generally happy with it. It is an eat-what-you-kill system. Since we are generally happy why should we consider changing it?
Response:
You can start with the following firm – self-test. Has the firm experienced or is it experiencing:
- Partner defections
- Firm splits and breakups
- Personal fiefdoms
- Maverick partners
- Hoarding work
- System perceived as unfair
- Problems acquiring and retaining top legal talent
- Low productivity
- Low profitability
- Client dissatisfaction
- Low morale
- Disputes with former partners
If your firm is experiencing or has experienced the above symptoms, it is time to really examine where the firm is headed and what messages your compensation is sending out to your partners. Is the firm trying to be a firm or merely a group of lone rangers? Even though your partners are content your compensation system may be holding the firm back from becoming all that it desires to be. Contentment may not be the best measure of success.
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John W. Olmstead, MBA, Ph.D, CMC
Posted at 08:07 AM in Compensation
Tags: Law firm partner compensation
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