Law Practice Management

Kelley Drye Settlement with EEOC Offers No Guidance On When a Partner May Be Deemed an Employee

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A consent decree (PDF) filed Tuesday in federal court in Manhattan resolved a more than decade-old pay dispute between Kelley Drye & Warren and one of the New York-based law firm’s older partners.

In addition to a $574,000 payment by the firm to Eugene D’Ablemont, covering work he performed from 2001 to 2011, it has also agreed to pay him 12 percent of what he collects from this point forward, reports the Am Law Daily. Given a choice, D’Ablemont, who is in his early eighties, decided not to retain equity status, and the firm agreed to eliminate an age-based retirement policy years ago in the age discrimination and retaliation case brought by the Equal Employment Opportunity Commission.

A previous post provides additional details about the settlement.

However, the case doesn’t resolve a core question of when a so-called partner may be an employee for the purpose of applying the Age Discrimination in Employment Act and other laws prohibiting workplace bias, the Am Law Daily article notes. Hence, law firms and other employers need to beware of applying mandatory retirement policies, for fear they, too, could run afoul of the EEOC.

“We certainly hope this sends a message that EEOC is looking at this issue and is concerned about mandatory retirement policies,” said Jeffrey Burstein, a senior trial lawyer who handled the D’Ablemont case for the federal agency. Even if partners don’t complain, the EEOC will consider bringing more such suits, he told the legal publication, adding: “We’re interested and concerned about the issue.”

An earlier landmark case, brought by the EEOC concerning Sidley Austin’s de-equitization of 32 partners, resulted in a $27.5 million settlement.

Kelley Drye did not admit any wrongdoing in the latest settlement, and the firm’s managing partner, James Kirk, said in a written statement that it was surprised the EEOC pursued the case for as long as it did, given the fact that Kelley Drye changed its retirement policy years ago. “The firm has not discriminated or done anything wrong,” he wrote, “and the amounts of the monetary settlement payments that cover more than a decade from 2001 through 2011 are consistent with our belief.”

Related coverage:

ABA Journal (2005): “Who Is a Partner?”

ABA Journal (2007): “Age Shouldn’t Matter”

ABAJournal (2008): “Retiring Mandatory Retirement” (2007): “Sidley ‘Partner’ Payout: Up to $1.8M” (2007): “BigLaw Firms End Mandatory Retirement” (2011): “BigLaw Partner Scores Win in Retirement Fight; He’s an Employee, for Discrimination Law Purposes”

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