-
Mark Brewer
Director & Partner team
London
Regional Law Firms
Historically
Whilst partners have traditionally seen fit to run their partnerships according to a unique set of principles, they have over the last few years become increasingly conscious of the need to adopt a more commercial approach in managing what are in fact businesses like any other. This has often had an impact on the structure of law firms, with many opting to take on LLP status, whilst others have simply modified the form of the existing partnership.
Today
Over the last decade, an increasing number of partnerships have moved away from the salaried partner concept towards that of the ‘fixed share' equity partner, whereby such partners are regarded as self-employed rather than employees and are taxed accordingly.
Salaried/fixed share equity partnership status is provided to fill in the gap between assistants and full equity partners. A firm hiring a senior lawyer may not wish to give them many voting rights initially, perhaps requiring them to prove their worth before rewarding them with full equity. Equally, a lawyer may be promoted internally to this level and remain there for a number of years before being required to present a business case for making the next step up the ladder.
Market demand
As the market continues to improve, so does the demand for salaried/fixed share partners. Recruitment by firms at this level can be broken down into two distinct sets:
- Opportunistic - Most firms will consider taking on partners who are able to bring extra business to the practice, albeit in areas where perhaps they have not been looking specifically to recruit, or indeed may have not historically handled the particular area of work in which the incoming partner specialises.
- Strategic - If a firm is looking to build its reputation in a particular area, it will often look to hire at salaried/fixed share partner level, so as to restrict the incoming partner's rights and entitlements and expedite the recruitment process.
Notice period
As is the case within firms in London, this tends to be at least six months and on occasions, a year.
