Historically, new law school graduates joined a law firm, spent a certain number of years (usually six to ten) working for that firm, and then were considered for partnership. Associates either were elected to full equity partnership status, or turned down. If “passed over” they were expected to leave the firm within a reasonable period of time. This one-tier partnership and “up-or-out” system began eroding in the 1980s as the increasingly competitive legal marketplace required new approaches to the traditional partnership system. Since then, law firms devised multiple layers of associates, counsel, and equity and non-equity partners, with varying titles and attributes.
These days, for senior associates with skills and abilities valuable to the firm but not quite ready for promotion even to non-equity partner status, many firms created positions with titles such as “counsel,” “special counsel,” or “senior attorney.” From a business perspective, the up-or-out policy was unwise with regard to these associates. Given the costly investment in training and development of these associates and their institutional and client knowledge, they handle relatively sophisticated work with minimal supervision and, thus, are profitable for the firm. Many of these lawyers become partners in their firms at a later date; others find their prospects of further promotion at the firm unlikely. In those cases, these attorneys may find that a move to another law firm affords them the opportunity for further career development.