More Partner Bloodletting Predicted for 2009
Posted Feb 12, 2009 7:11 AM CST
By Debra Cassens Weiss
Law firms are likely to take a hard look at underperforming partners this year, with more cuts and de-equitization ahead, according to some consultants and recruiters.
There is “a scary consistency” to the predictions, the American Lawyer concludes, with cuts likely at law firms both here and in the United Kingdom.
Consultant Peter Zeughauser told the publication that partner ousters have already begun. "It's widespread across large, midsize and small firms,” he said. Among the firms showing partners the door: Jenner & Block, which reportedly asked about 10 partners to leave in October; Clifford Chance, which plans to eliminate an undetermined number of partners; and Legal Week has reported that Linklaters is restructuring its partnership.
Zeughauser estimates that up to three-quarters of the nation’s top 100 law firms are considering partner reductions. "There's a high level of anxiety about 2009,” he told the American Lawyer. "You're seeing a pretty systemic review of what needs to be done [in order to] hold on to top-performing partners."
Zeughauser and K&L Gates chairman Peter Kalis both told the American Lawyer that law firms with large numbers of nonequity partners are most likely to make cuts, holding on to partners who generate business and dropping those who don’t, the story says. Firms with one-tier partnerships, such as Wachtell, Lipton, Rosen & Katz and Cravath, Swaine & Moore, aren’t likely to oust partners.
Kalis said his own law firm has no plans to cut partners.