Young City lawyers must do more to become partners
Associates will have to wait longer and do more to ascend the ranks, according to a meeting of some the City's top lawyers
Young lawyers at the UK’s leading law firms will have to wait longer and do more to distinguish themselves in order to become partners, a group of the City's most powerful solicitors has predicted.
Twelve senior lawyers from private practice and major banks met last month at a London hotel and agreed that keeping the best talent happy is one of the profession’s most pressing problems at a time of widespread discontentment.
The lawyers said that although the rewards of partnership are greater than ever – with equity partners at the top firms taking home an average of over £1 million this year – it has become harder than ever to ascend the ranks.
“Partnership is a harder goal to achieve, that’s the reality,” said Richard Linsell, a partner at Addleshaw Goddard.
In the past, partnership was considered almost a formality for competent solicitors with more than six years experience but lawyers are now being forced to wait at least eight years in most cases – and even then it is not guaranteed.
Competition has become intense and firms are increasingly selective as they seek to “leverage” the ratio of associates to partners to drive up their profit per equity partner (PEP), the industry’s key measure of financial success.
David Cheyne, senior partner at Linklaters, the “magic circle” firm, said: “When I first became a partner [in 1980], it’s fair to say that if you were a good lawyer, made no enemies and there was a slot, you were likely to get partnership.
"We now very consciously try to assess whether you are going to survive. You still need to be a very good lawyer, but we look for a little bit more.”
Top firms' failure to retain associates and provide a fulfilling career path is one of the industry’s most enduring and intractable problems, but rarely have so many senior lawyers made their thoughts on the issue public.
Attendees at the meeting included Judith Shepherd, deputy general counsel at Barclays; Richard Rosenthal, European general counsel at Morgan Stanley; and Nigel Boardman, a mergers and acquisitions partner at Slaughter and May – widely regarded to be the most influential lawyer in private practice in the City.
Career dissatisfaction, particularly among younger lawyers, has been a hot talking point in the City recently after a survey in The Lawyer magazine reported that a third of associates want to quit because of the stress, long hours and often dull nature of the work. Most feel they cannot leave because of the amount of money they earn, the survey said.
Competition for talent has already pushed the top starting salaries for newly qualified solicitors from £65,000 to £90,000 at some US firms.
The depth of dismay has been reflected in comments posted on Times Online in recent weeks. One typical comment, from a six-year qualified solicitor at a US firm in London, said: “To anyone thinking of becoming a City lawyer, the wall of money that can come your way comes at a price.
“The saddest thing I ever heard was a female partner telling me she heard about her son’s first steps from the nanny, on the phone.”
Lawyers at the meeting suggested associates may look to other sectors such as financial services to offer a more rapid and rewarding career progression.
Richard Rosenthal, managing director and European general counsel at Morgan Stanley, said: “In the last three years, you are seeing associates as well as partners decide they want to be an M&A banker, or in the structured products area.”
The traditional partnership model is also failing to accommodate the changing needs of senior lawyers, the lawyers suggested.
Mr Rosenthal said: “It used to be that you arrived a law firm and said, ‘I hope to make partner and then I’ll retire and that’s my career.’ People are now much more expansive in their thinking and think, ‘I’m going to take a year off and try inhouse, then I’m going to go back to a law firm, I may consider going into the Government, and [then] I’ll go somewhere else’.”
UK firms have historically been rigidly structured with little encouragement for partners to gain experience in other fields, to move sideways into public sector or business roles, or to take time off for lifestyle reasons.
There was also concern that partners at many firms were "moved on" once they reached their mid-50s.
Simon Beswick, a partner at Osborne Clarke, said: “We have found that we have very few partners beyond the age of 52 or 53. One of my challenges is to see if I can get partners working through to 60 in a way that satisfies them and satisfies the firm.”
The lawyers emphasised they were interested in modernising the traditional partnership model rather than scrapping it. "I don't think we should all be worrying and saying partnership culture is over, horror horror," Mr Linsell said. "I don't think that is the case."
Michael Hatchard, a leading M&A lawyer at Skadden Arps Slate Meagher & Flom, suggested firms in the UK could learn from their US counterparts.
“The softness that is a much more American feature, and the ability to drift in and out and to adjust, to take a lifestyle decision in the middle and return at some point fully recharged, means we have partners in their 60s and 70s and beyond who have come back in and make an extraordinary contribution.”
Dominique Graham, a director of Graham Gill, a consultancy which organised the meeting, said: “There is increased competition out there, but if firms maintain flexibility and allow people to reinvent themselves and go off and do other things knowing they can always reintegrate, then they can stay attractive places to work.
“At the moment, there are signs of a malaise in private practice, which law firms must find imaginative ways to address.”
(Published by Times Online, July 23, 2007)