Many books about partner compensation are written from a BigLaw perspective. But authors Camille Stell and Brenda Barnes recognize that most lawyers work in smaller and mid-size firms where core values and personal relationships mean so much.
With RESPECT – An Insight to Attorney Compensation Plans, the authors have written a clear, straightforward guide to partner compensation for those law firms in which culture really matters, collegiality and client service are genuine priorities, and respect among professionals is meant to be strengthened every day. Partner compensation in smaller and midsize firms is about more than just money.
This guide to attorney compensation includes:
- Compensation formulas
- Origination credit and equity
- The role of the Managing Partner, along with a job description
- Compensation carve-outs such as paying non-equity partners
- Compensation system biases
- Trends in compensation
Why choose Lawyers Mutual for your financial protection? One reason is experience. Lawyers Mutual has been in business since 1977 and insures more than 8000 lawyers in North Carolina. We’ve been providing continuous protection from professional liability to NC lawyers longer than any other insurance company. Another reason is stability. The company’s financial strength is absolute. Since 1999, Lawyers Mutual has paid dividends fourteen times, with more than $8 million dollars returned to policyholders since 2011. Want even more reasons? Visit our website, give us a call, or ask a colleague why Lawyers Mutual is the smart choice for liability coverage.
How to Handle Business Originations
Sneak Preview of RESPECT: An Insight into Attorney Compensation Plans
Below is an excerpt from RESPECT: An Insight into Attorney Compensation Plans, by Brenda Barnes and Camille Stell (reprinted with permission of the authors):
Businesses thrive only when they have sales – and lots of them. To increase top-line revenue, firms must continually generate new business. In professional service firms, sales, or business development, is generally referred to as Business Origination.
Whether or not your firm tracks originated business or compensates attorneys for new business, it is vital to understand the importance of the top line. A healthy top line performance allows firms to consider strategic planning as opposed to focusing solely on attorney productivity.
Deciding how to reward a partner for bringing in new business isn’t always straightforward. For example, what does it mean to originate business? Who gets the credit for a specific client or engagement? What about additional matters generated by other attorneys for the existing client? How long is it fair to compensate for this contribution: forever or through a certain period of time?
A book of business is the size of the client base that partners are responsible for managing and for which they receive credit in the firm’s partner compensation system. A book of business can either be originated (known as “finder” credit”) or inherited (known as “minder” credit). Many partner compensation systems pay attention to business origination as an important contribution to the success of the firm.
Many firms generate new revenue from referrals made either by clients or other external sources such as law school classmates, friends or family. Typically, the sales process is shorter. But it still requires effort to close the sale. Many firms treat referrals the same as finder sales because it does take additional effort to close the sale.
Often the best and easiest new revenue is from the existing client base. For example, if your client has generated a litigation matter, are there other litigation matters that can be generated? Another example would be additional trademark work for a trademark client.
Everyone makes mistakes. When it happens to you, Lawyers Mutual has your back. For nearly half a century, Lawyers Mutual has been the smart choice for professional liability coverage for North Carolina attorneys. We cover the state from Murphy to Manteo. We insure large firms, solo practitioners and everyone in between. We help new lawyers enter the profession with confidence, and we help keep seasoned veterans safe and successful. The numbers speak for themselves. Lawyers Mutual has been in business since 1977, making us the only insurance carrier to provide continuous protection over that period. Today we insure more than 8000 lawyers in North Carolina. Most of them will stick with us until they retire. Why? Because they know we are here for them today and will be here tomorrow, bringing protection and peace of mind in turbulent times. Visit our website, give us a call, or ask a colleague why Lawyers Mutual is the smart choice for liability coverage.