More law firms are paving the path to partner, but what happens once one gets there is less than certain.
By Lizzy McLellan | November 19, 2018 at 05:00 AM
In some ways, the country’s most recently promoted partners are more prepared than ever to take on their new roles. But the change still comes with its surprises.
“I will acknowledge it is one of those things where you signed your marriage license and walked down the aisle without fully knowing what it was going to be [like] until afterward,” says Lillian Hardy, a litigation partner at Hogan Lovells who was promoted to partnership in 2017.
Still, Hardy says she felt prepared for partnership, having sought out advice from others in her network on how to build a book of business. She also spent some time on a secondment, which “gave me a sense of what in-house people care about and what it means to be serving as their business partners.”
Likewise, Angela Dunning, a partner at Cooley, says she had realistic expectations of the transition, especially because she took a longer track to partnership, joining the firm as an associate in 2000 before becoming special counsel in 2010 and partner in 2017.
“The firm does a great job of making it known to folks what is expected,” she says.
This year’s New Partner Survey, conducted by The American Lawyer and ALM Intelligence, shows that law firms are increasingly training lawyers in areas that will become their responsibility upon making partner. A total of 425 lawyers responded to this year’s survey.
The proportion of new partners getting leadership training in-house has increased by 7 percent since 2015—58.4 percent of respondents said they have received leadership or management training from their firms, up from 55.8 percent last year.
And 28.2 percent of respondents said they have received leadership or management training from an executive coach. That number remains steady from last year, but it has increased by nearly 5 percent since 2015.
Where firms really seem to be investing training resources, however, is in business development.
Nearly two-thirds of new partners (65.9 percent) said they have received formal business development training, up from 62.9 percent in 2017, and 57.3 percent three years ago.
Formal project development training, while less popular, also appears to be on the rise, with 31.5 percent of respondents saying they have received it, compared with 27.2 percent last year.
And while these types of training are on the rise, only business development and leadership training have reached a majority of new partners surveyed.
Just 56.5 percent of respondents said they are satisfied or very satisfied with the training and guidance offered by their firms. Based on respondents’ open-ended comments, the feeling of being adequately prepared for partnership is clearly not universal.
“It was like they said, ‘Congratulations! The rules just changed, but we are not going to tell you what they are,’” one respondent, a third-year partner, said.
Legal industry analyst Jordan Furlong says some firms seem to be making a conscious choice not to educate future partners on what lies ahead.
“Law firms aren’t doing a good job of setting expectations for partnership because I’m not sure they know what the expectations of partnership are,” he says. “It’s a shame, because it’s something that could easily be fixed.”
It appears firms could do a better job of educating lawyers on how their pay will change when they enter the partnership.
Of the 238 survey respondents who answered the question “What has disappointed you the most” about making partner, 71 were disappointed with compensation.
Asked to rate their satisfaction with various aspects of partnership, only 57.2 percent of new partners said they are satisfied or very satisfied with compensation.
One respondent said they were disappointed to be “treated as a glorified associate for purposes of compensation and bonus (and, thanks to the midyear associate raises, I’ll make less than most senior associates this year).”
Another said that buying shares, along with lower-than-expected pay and an end to performance bonuses, had placed a strain on finances. “It’s really depressing and demoralizing to get a promotion and then to have to put your family on a strict monthly budget,” that respondent said.
James Cotterman, a consultant at Altman Weil, said he’s not surprised by the number of new partners expressing a misalignment between their compensation expectations and reality.
“In general, career progression management is not a legal profession strength,” Cotterman says. New equity partners see higher pay, but they have to pay for their own benefits and self-employment taxes, as well as capital contributions.
“The introduction of nonequity partners delayed this conversion problem in many cases, but it rarely erased it,” he says.
The proportion of respondents who are equity partners was 36.5 percent, up slightly from 2017, while 63.5 percent of respondents are income or nonequity partners at their firms.
Cooley’s Dunning says she “knew roughly what I would make, I knew the tax situation would be difficult to manage for a time and I think I was prepared for that.” Still, she notes, with regard to compensation and benefits, “I think there were some things we were all surprised to learn.”
Legal recruiter Robert Kinney says lack of knowledge about partner compensation is “pervasive.” Still, he says, law firms where associate compensation edges up close to junior partner compensation are likely overpaying associates. And that can cause problems with retaining junior partners.
“If they have a client book, they’re talking to recruiters,” he says.
Business Developer or ‘Hired Hand’?
Having a portable book of business may not be so common among new partners, even as firms increasingly provide business development training.
The number of new partners who have no clients of their own appears to have risen. When asked what percentage of their time they spend working on matters for their own clients, 18.4 percent of respondents said they don’t have clients of their own, compared with 13 percent of last year’s respondents.
A similar proportion of respondents—18.1 percent—said they spend more than half their time working on matters for their own clients. That number hasn’t changed much since 2016, but in 2015, 23 percent of new partners said they spend more than half their time on their own clients’ matters.
Still, that doesn’t mean lawyers feel disconnected from the clients they work with.
The vast majority, when asked how they would describe their client relationships, either said they “serve as a close confidant” or “we’re part of the same team.” Only 3.7 percent said “I’m mostly just a hired hand.”
And 96.8 percent of respondents said they are satisfied or very satisfied with their client relationships, while 91.5 percent said they are satisfied or very satisfied with the amount of client contact they get.
In open-ended answers, a number of new partners said they were struggling with building a book of business. Or they said they were dissatisfied with or worried about the amount of work they were being assigned to do.
“I was not prepared for certain sources of work to abruptly dry up as soon as my title changed from associate to partner,” one respondent said.
Others said they were disappointed to find that older partners were not passing down their clients to new partners, or that their firms didn’t provide enough opportunities for client interaction to those below the partner level.
But some said they simply need more time to build up relationships.
Needed: Relationship Sharing
Furlong says these answers suggest that more senior partners have not been told it is their responsibility to help junior partners become business generators.
“I imagine at the great majority of firms, this expectation is not communicated,” Furlong says. “At the end of the day, it is on the firm to do this properly.”
But the upcoming partners have to take some initiative too, he notes.
“There is also absolutely a responsibility on the partners coming up to be crystal clear about what they’re getting themselves into,” Furlong says. “Seven years, eight years, 10 years, that’s a lot of time to figure it out.”
New partners who seemed happier with their ability to develop business in several instances noted training or mentor relationships that helped them to do so before they entered the partnership.
“My firm has viewed associates as the future of the firm and starts business development training early on in an associate’s career. I appreciate that I am not starting business development from scratch on day one of partnership,” one respondent said.
Hardy, of Hogan Lovells, says she feels well prepared for partnership, thanks in part to her choice years ago to seek out others in her network, people who could include her in business development efforts and people who would be interested in working with her.
“It’s one of those jobs that’s sort of like being a musician. You kind of bring your own style to it,” she says. “That’s how I’ve approached being a partner.”