How Law Firms Treat their Leavers

1 Jul 2016

When our Chairman, Phil Jepson, was a Partner at DLA (now DLA Piper) there was no restrictive covenant. The firm made a lot of Partner lateral hires with followings and accepted that if Partners left, then clients would leave too.

So why fight this reality?

Now firms try to impose restrictions on Partners and in some cases actually prevent them from leaving at all. 

We completely agree with an article written by Mark Brandon in the Lawyer – Firms should just let Partners leave, restrictive covenants are really not helpful.

Although not the only firm to enforce this, Addleshaw Goddard’s recent announcement that it will be introducing a restriction on the number of partners who can leave the firm in a single year, has brought the subject to light.

As Brandon says: “It a kind of modern feudalism, as if this strange entity, the firm, owns its human assets and will fight to keep them all and dispose of them as it sees fit.” Fundamentally, a partnership should be treated as a group of individuals who have come together for mutually beneficial commercial interest, it should not be treated as a corporate entity or assets upon a balance sheet. 

In the words of our Chairman, Phil Jepson: “If you love your partners, set them free. Don’t hold them hostage…You cannot and should not run firms on a platform of negativity and fear. Regimes of fear always fall in the end but at great cost to all involved.” 

Our research business, Empirical Research, has conducted significant research in this area. Statistics show that within the current market, high-potential employees don’t want to stay at the same firm for their entire career. Thus, because of the increasing flow of individuals in and out of firms and their competitors, the individual leaving can influence the markets perception of a particular firm and their brand. Obviously, this then has implications for said firms ability to win clients and attract talent in the future.

So surely, it is in a firms best interest to part with their leavers as pleasantly as possible.

Some firms use alumni programmes to maintain relationships with their leavers because ultimately, it makes the most business sense. Alumni networks can significantly boost a firms brand identity, internally and externally. It instils positivity, relationship-building and opens up the labour pool, the client pool through referrals, as well as the option for past leavers to return.

The Top 10 UK Law Firms all have alumni programmes. Of the Top 50 UK Law Firms, 58% have an alumni scheme. We have recently helped a leading international law firm evolve their alumni offering and therefore have seen firsthand how it enhances connectivity between a firm and the market. 

In todays market, with social media enhancing connectivity and with movement in out of firms increasing, leavers never really leave a firm for good. At a minimum, the firm will always be listed on that persons CV and with platforms such as LinkedIn offering transparency regarding an individuals career history, potential clients and business leaders of the future can easily find out and therefore ask for the individuals opinion of their past firms. 

Ultimately, leavers will always carry with them a piece of the firms they have worked for throughout their career. Therefore, a firm should ensure that they provide the best motivations possible for an individual to still value that small piece and to look after it, as they walk off into the sunset.