The majority of today’s law firm associates are Millennials and Gen Zers who never knew a world without constant communication. With the ubiquity of smartphones and the internet since birth, they’re accustomed to nonstop information at their fingertips, and expect the same level of accessibility and transparency from employers. They’re generally not afraid to ask questions and want immediate, clear answers.
According to the 2022 AmLaw Midlevel Associates Survey of over 4,000 Biglaw associates, they overwhelmingly want a detailed roadmap of their career path alternatives clearly spelled out for them. According to the survey, associates were more dissatisfied with their firms’ lack of communication regarding the partner track than any of the 14 other categories of firm management and communication they were asked to evaluate. This lack of information causes anxiety and leads associates to fill in the gaps with their own possibly misguided perceptions and gossip.
Associates want their legal employers to define their organization’s requirements for entry into partnership, specific steps for getting there, and whether they are on track. They want to know if there’s more than one path to partnership and specifics about the firm’s expectations regarding hours (billable and non-billable), business development, committee and other firm participation, and so forth. Several associates also mentioned that they wanted to know, in particular, whether working remotely would hurt their odds of making partner.
Today’s Biglaw associates seek to be shepherded on their way, with regular and practical feedback in real time (rather than only once a year at a formal performance review) with specific guidance on how to improve.
Even if the associates aren’t sure they ultimately want to become partner, they need this information to make informed decisions about their careers. And they want the information sooner rather than later, especially since the ideal time to switch firms is in their third- to fifth-years if they’re not already a clear candidate for partner at their current firm.
The midlevel associates indicated that they also would like more transparency on the difference between their firms’ equity and nonequity tiers. Many survey respondents mentioned that it’s unclear to them whether their firm intends to promote nonequity partners to equity partner in a few years and, if so, the criteria for elevation, or just keep them at the nonequity status permanently. Alternatively, if full equity partnership isn’t their goal or seems unattainable, associates want transparency regarding other career tracks available within their firms such as counsel, nonequity partner, staff attorney, or other professional executive/non-practicing roles.
Associates also need transparency regarding law firm economics which provides guidance for planning their futures based on actual metrics. It helps them understand how their individual choices regarding selection of practice area, billing rates, and billable hours can impact their success, at least in terms of compensation and advancement and how they compare to their peers in the same and other firms.
Start with the big picture of how associate rates are set. Explain when and why an associate’s compensation shifts from being principally determined by billable hours and revenue generated by that associate’s own work to a model that takes realization and effective rate, origination, and other factors into account.
Discuss the firm’s market position, its clients, overhead costs, and the like. There may be differences in economics between the various office locations and practice groups. Since associates on the partnership track will eventually bear the consequences of having a lower effective rate, or of working in a regional satellite office or a less remunerative practice area, it’s best to be clear about such factors upfront.
There are almost as many systems of partner compensation as there are law firms, and each both reflects and shapes the culture of the firm. Therefore, give associates at least a basic idea about how the firm calculates partner compensation, especially regarding what factors are considered and how they are weighted, so they know where they are headed and can plan accordingly.
Career path and compensation conversations will make more sense to associates if they understand their firm’s economics. An additional benefit of increased transparency is that it facilitates attracting and retaining lawyers who are suited to the firm’s particular economics and culture.