The discussion around the Great Resignation has hinged on people quitting their jobs for better opportunities—2021 job quitters said low pay, minimal opportunities for advancement, and feeling disrespected by employers were their main reasons for leaving, according to a recent Pew Research survey.
But in recent interviews, Am Law firm leaders reported another phenomenon when asked about 2021 partner exits. Having raked in substantial profits in recent years and, at some firms, facing a return to the office, some partners are deciding to reduce their commitment to the firm or quit the profession before “retirement age.” For those who can afford it, that age may be more of a mindset than a number.
Greenberg Traurig finished the year with 66 fewer partners on total head count, but 14 fewer partners on full-time equivalent status. In a March interview, CEO Brian Duffy said the rift between total head count and FTE was partially due to partners reducing their workload at the firm. The trend was more prevalent in 2021 than in 2020.
“Based on the conversations I had with people, they had taken some time, worked from home, and decided they liked it, and they were in a financial position to maybe not work full-time anymore. And they decided to change their lifestyle,” Duffy said. In response to partners’ desires to work remotely, or at least near their homes, Greenberg opened two Long Island locations earlier this year to reduce the commute for New York lawyers.
California legal recruiter Larry Watanabe said law firm partners are reconsidering their careers after years of exceptional partner profits.
“A lot of partners are going to end up retiring because they never envisioned earning this kind of money early in their career,” Watanabe said in a recent interview. “They’ve told me that point-blank—it wasn’t long ago that $1 million was a reasonable level of income. That’s a starter today. People’s drive and motivation to continue practicing is going to change a lot because their wealth has increased so much.”
At Holland & Knight, managing partner Steven Sonberg said the optimism that kicked off 2021 wore off with subsequent COVID-19 variants, causing attorneys to reevaluate their career and life goals. This year, Sonberg told Holland & Knight lawyers to expect more in-office attendance than the firm required in 2021, emphasizing the cultural benefit of in-person interaction.
Those factors influenced some of the firm’s partners who retired early in 2021. ”For people who had a fair amount to go in their careers, the combination of thinking about commuting, rebuilding their practices, and the possibility of having to get back on the road—all of those things weighed on people,” Sonberg said in a March interview. “It’s been a time when people have reassessed their lifetime objectives, looking at where they are today and what’s going to happen over the next 10-15 years, and concluding that Big Law was not for them anymore.”
Sonberg added that he would be receptive to partners asking to go half-time, although he wasn’t sure what the answer would be.
Law firm partners’ career reevaluations may ultimately benefit smaller Am Law firms that aren’t as leveraged and provide a platform for nonequity partners who don’t have equity tier aspirations. Nelson Mullins Riley & Scarborough, for instance, has expanded its nonequity tier by 17% in the past two years while its equity partnership has shrunk by 4%.
“We want to be in a place where regardless of career choice, we’re a good place for you,” said managing partner James Lehman in a March interview. “We welcome the nonequity partner who wants to move to equity partner. We also understand there are a number of people who, for personal or family reasons, they’ve chosen not to make that level of commitment or may want to make it in five years. We want this to be a good place for both from a compensation and professional reward standpoint.”
At the New Orleans-based Adams and Reese, an Am Law 200 firm that saw its equity tier shrink by 12% in 2021 while the nonequity partner head count held flat, managing partner Gif Thornton said the equity exits were both due to a mandatory de-equitization policy at age 67 and some equity partners choosing to roll back their responsibilities at the firm.
“We have a really forward-looking supplemental retirement program my predecessors initiated 20 years ago, the components of which put a working lawyer in a position to be able to retire if he or she wants to at a good age,” Thornton said in a March interview. “I think a number of lawyers were able to throttle back financially and chose to do so.”
Watanabe said the profitability may also influence equity partners to stick around after they reach typical retirement age, which may cause problems for firms that don’t scrutinize their productivity or mandate retirement. Recently, Watanabe spoke to a partner who’s considering a departure in part because her firm’s senior equity partners are “hanging around, collecting a check,” Watanabe said. “Why would they forgo that?”
Law firms’ willingness to allow partners to continue working remotely from their second homes will also factor into lateral decisions and retirements, said Major, Lindsey & Africa partner recruiter Jeffrey Lowe.
“For some, it’s actually extended the length of the time they’re going to practice law,” Lowe said. “Some firms have found that if they push too hard, they might cause partners to move to a firm that’s going to give them more leeway in terms of office attendance. It’s definitely a sellers’ market.”
