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5 REASONS YOU'LL NEVER MAKE EQUITY PARTNER
Law360, December 8, 2015
By Kat Greene
LOS ANGELES — Early in your legal career, you may have set your sights on BigLaw’s gold ring: an equity partnership at a white-shoe firm. But even the best-laid plans sometimes go awry.
Being a skilled, charismatic lawyer with the ability to win clients and dedicated to your firm and practice area are all steps up the ladder, experts say. But during the course of your career, any number of slips can spoil your chances at winning a seat at the partner table.
Larry Richard, a psychologist and lawyer who founded consultancy LawyerBrain LLC, told Law360 that in a tighter economy, clients have more power than ever to make demands from law firms, putting economic pressure on the firms and changing the factors that decide who makes partner and who doesn’t.
“As a result, fewer people get a piece of the pie,” Richard said. “It’s not a simple equation by any means. There’s lots of hidden variables that influence whether a particular firm is going to welcome a partner.”
Here, Law360 takes a look at some of the most common reasons attorneys find they’ve lost their shot at becoming an equity partner:
You Don’t Make It Rain
If you aren’t bringing in new business for the firm or controlling a large Rolodex of clients, it’s likely you’ll have to kiss your chances at equity partnership goodbye, several experts said. Law firms are businesses, and they need partners who can keep the bottom line in mind, said Amy Hancock, director of professional development at Andrews Kurth LLP.
“If a lawyer finds himself a victim of adverse market conditions and/or a significantly constrained billable rate and cannot exhibit enough initiative, creativity, ingenuity and self-determination to carve out another more commercially relevant legal practice area niche or expertise, then he or she may find their window to law firm partnership starting to come to a close,” Hancock said. “This is because law firms are still just basic revenue-generating businesses and revenue collection, or lack thereof, still drives their bottom-line, business decisions, of course.”
Richard said that, while being a likable team player helps, bringing in business is sometimes all that matters.
“Some firms these days actually do insist that a partner have the ability to collaborate [to make partner]. That’s very important these days for lots of reasons,” he said. “But if someone has a huge book of business and they don’t collaborate, they’ll probably make partner anyway.”
Ken Young, who was a practice group leader at Nelson Mullins Riley & Scarborough LLP for 20 years before co-founding Young Mayden Legal Search, said that the largest law firms’ focus on profits per partner makes them resistant to welcoming partners who don’t generate new business or control significant existing business.
“They are reluctant to admit anyone who is not producing huge numbers in the way of individual collections or client originations,” Young said. “They also don’t want to share budget overages at year end with lawyers who are what they refer to as ‘service lawyers,’ lawyers who help service firm clients but do not ever bring in new clients or control institutional clients.”
Delia Swan of Swan Legal Search agrees that the more competitive legal market makes so-called service lawyers a tougher sell at the partnership level.
“Things have become tough, where everybody had better bring in business,” Swan told Law360. “There’s not a lot of room for service partners.”
You’re in the Wrong Practice Area
If you’re starting to feel like John McClane in the "Die Hard" movies — always in the wrong place at the wrong time — it’s a sign you’re not destined for an equity partnership at your firm, experts say. You may be in a city where your skills aren’t highly valued, or in a practice area your firm no longer finds useful, but either one could doom your chances.
“It’s a red flag if your practice area does not comport with the future of the firm,” Swan said. “If you’re doing tax, and the law firm is largely driving its business away from tax, the writing’s on the wall there.”
What city you’re in matters, too, said Harrison Barnes, CEO of BCG Attorney Search. For example, a patent attorney would be very marketable in the San Francisco Bay Area but might had a harder time finding work in, say, Ohio.
“Attorneys need to go where there’s the most value,” Barnes said. “It depends on the market. In Detroit, for example, people don’t make as much, but they protect their own because there aren’t a lot of places to go.”
And if you’re in a practice area swarmed by other lawyers, it may be harder to stand out, Richard said.
“In some practices, [lawyers] are commoditized, because there are so many lawyers available to do that work,” he said. “Supply and demand and the level of risk a client is willing to take — those all factor into what kind of reception a partner is going to have when you’re looking at a book of business.”
You Made a Colossal Mistake
If you can’t prove you’re an absolutely excellent lawyer, the firm is less likely to make you an equity partner. A blown deadline, forgotten filing, or other legal mishap could land you in career limbo, experts say.
“There are some major screwups you can do in litigation and corporate law that will get you in trouble,” Barnes said, relating a cautionary tale of an acquaintance who was expected to make equity partner at a large law firm.
Just a few weeks before the vote, someone asked the lawyer if he’d sent a short letter to a client. He hadn’t, but fibbed and said he had, then logged back in at work and sent it right away. It was a mistake that cost the attorney his career at the firm: When the partners found out about the lie, they fired him, Barnes said.
Swan agreed that producing flawless legal work is an essential part of the partner equation.
“You have to be damned good at what you do, and you have to be extremely likable,” Swan said. “You have to be that perfect person, you know? You have to have clients pick you over 50 other superb lawyers.”
“It’s very competitive out there, and you have to sell them on that. It’s not an easy thing to do,” she added.
You Took Time Off to Raise Your Kids
Being a woman can mean gloomy prospects for making equity partner at your firm regardless of whether you’re also raising a family, according to several studies released this year. The ninth annual National Association of Women Lawyers report on female lawyer retention and promotions, released in October, found women in 18 percent of equity partner positions — just 2 percentage points higher than in 2006, the first year the report was issued.
Meanwhile, data collected by the Diversity & Flexibility Alliance showed that female lawyers nabbed just over 34 percent of new-partner promotions at major law firms in 2015, up from 32 percent a year earlier. But 14 firms reported they’d promoted no women to partner in their U.S. offices.
That creates a tough environment for ducking out for maternity leave, never mind leaving for a few years to care for your children while they’re young. Barnes said that firms are looking for complete commitment and dedication to clients and firm business, and that leaving for long periods can hurt your chances at making equity partner.
“If you’re working with people who work lots of hours, and it’s a competitive environment, if you leave, that’s perceived as weakness. You shouldn’t be leaving for that long,” Barnes said. “In every significant law firm, there’s an expectation that you’re going to be 100 percent committed.”
It’s possible a lawyer could take a long leave, say, to care for ill parents or raise children, but it’s important to maintain the relationships you had with clients even while you’re gone.
“As a partner, you have two values: either how many hours you contribute to the bottom line of the firm, or what type of clients and connections you bring to the firm,” he said. “If you can hand those relationships off when you leave and maintain those relationships while you’re gone, you can maintain credit for them.”
You Just Didn’t Want It
Becoming an equity partner at a large law firm brings prestige, but that doesn’t mean it’s aligned with your goals and interests, experts say. In recent years, more lawyers are choosing not to take the equity partner track, preferring more schedule flexibility and fewer responsibilities to the additional pay that comes with partnership.
“When I started practicing law in 1978 almost every young lawyer who was hired by a firm of any size wanted to be a partner, and it was much easier to become one,” Young said. “Now, many young lawyers place more emphasis on quality of life and don’t want to burn out chasing a title and the higher income and stress that comes with it.”
More families are two-income households, where both spouses work, so the financial boost from a partnership might not be needed for families who’d prefer to spend at least some time outside the office, he said. He also noted lawyers are taking recent studies on lawyer burnout, depression and addiction into consideration when deciding whether to try for equity partner.
Swan said not everyone is willing to take on the financial risk of being in a partnership, noting that it’s not exactly impossible for a major law firm to fail.
“You have to think about whether you’ll accept that risk ... if the firm implodes, and that’s not all that unusual these days,” Swan said. “You have to be smart and look at all your options and look at the cost-benefit analysis.”
And you have to be willing to dedicate most of your time to the firm, something that’s not right for every lawyer’s life, she said.
“You have to work tons and tons of hours, and you don’t really get to let up,” Swan said. “In the old days, the partner would kick back and bring in business and let the associates do all the work. But now you’ve really got to dedicate your existence to it. If you’re not an overachiever, it’s something that you don’t want.”
--Additional reporting by Andrew Strickler and Max Stendahl. Editing by Brian Baresch.
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