Legal Commentary

If you read just about any law journal or Above the Law, you know that associates in big law firms have experienced the brunt of the downturn in the market for law firm services.  Associates have been fired, suffered cuts in their compensation, and have seen their start dates deferred.  Law students -- the future associates of law firms -- also have been harmed insofar as law firms have announced reductions or outright cancellations of future summer recruiting classes for 2010. 

So it's fair to ask, then, what about the partners? If the law firms don't have enough work to go around, the firm doesn't need so many partners, right? Why have we not heard about large scale partnership reductions?

Now, it might be that partners are suffering their own cuts, but that firms are not announcing those cuts the way they announce associate and staff terminations.  For a number of reasons, firms have little choice but to announce large scale layoffs (because if they don't, Above the Law and other blogs will rightly do it for them), but partners have more incentive to keep quiet.  

Alternately, the silence about partner firings could simply be a reflection of the fact partners really are much safer than associates, either because partners are more valuable to firms (sorry, I don't really buy that one either), or because they have the power to terminate everyone else before they look inward. 

Which option is it?

Originally, I assumed the former scenario (that partners were suffering, but suffering more quietly than associates). I figured that rainmaker partners within the practices that were still lucrative would demand that the firm get rid of the deadweight partners or suffer the consequences (ie, that the rainmakers would take their business elsewhere).  Why should the booming bankruptcy practice carry the backs of the M&A partners with nothing to do? 

Then it occurred to me that perhaps this would not be the case because, in this market, rainmakers might feel risk averse about leaving their own firm for another firm.  Rainmakers might distrust the information they receive from recruiting firms, and in a market like this, the costs of a mistake are pretty high.  Better to stick with the frying pan than to jump into the fire.  So, rainmakers may be staying put, and perhaps planning to leave when the market gets better. 

But that brings me back to the deadweight partners.  What's happening to them?  If the rainmakers stay put, is there any incentive to trim the partner ranks?  Or will firms decimate their associate ranks before they start thinking about their bloated managerial ranks?