Allens gears up for review of partnership model in response to changes in Australian market
Australian outfit Allens is gearing up for a review of its partnership model as the firm looks to adapt to changes in the domestic legal market.
September 16, 2014 at 07:47 PM
3 minute read
Australian outfit Allens is gearing up for a review of its partnership model as the firm looks to adapt to changes in the domestic legal market.
The Linklaters alliance partner, which has more than 850 lawyers and nine offices in Australia and Asia, has engaged a PricewaterhouseCoopers-owned consultant to facilitate discussions, but is yet to put any proposals forward to partners.
The decision to review its partnership structure follows changes to Allens' associate remuneration scheme on July 1 this year, which effectively scrapped post-qualification experience (PQE) as a reference for salary so that younger lawyers are now rewarded based on performance rather than length of employment.
The firm also abandoned the role of special counsel and added that of managing associate, a position which is thought to better cater for those with immediate partner prospects and allow more sophisticated work to go to younger lawyers.
Asked about the looming review, managing partner Michael Rose said: "The discussion we are having is about aligning our firm's strategy and structure. [We're thinking about] what our market is going to look like in the next five to 10 years and to what extent we need to change the partnership structure to meet those changes.
"It is not about money; it's about whether the partnership model lets us make the right decisions for the future and whether it is flexible enough."
As part of the initiative, the firm is expected to look at the existing career paths for partners; with issues being examined including the optimum length of partner careers and total partnership size, as well as the proportion of equity partners. In addition it may look at opportunities for lawyers to work part time and through more flexible arrangements.
Rose declined to say how future changes might affect the firm's existing modified lockstep remuneration model.
A partner at the firm said there had already been some initial sessions between partners and the consultancy, which included talks about the current pay scheme, looking at what good and bad behaviours it drives and how it compares with other models.
More discussions are expected to take place at the upcoming partners' retreat this weekend, and also at a board meeting in October.
Rose said the firm was considering all options, including different entry points for partners but made clear this was not a review of partner pay.
He said it had also not been driven by the tie-up with Linklaters, but by significant changes in the domestic market in the last half a decade.
"[The structure] hasn't been reviewed in a significant way for 30 years and in a market which has changed a lot in the last five.
"It is not something we are doing with Linklaters or to make us look more like them. We would have done it anyway.
"The legal profession is changing; the demands of clients are changing and they have really big implications about the way lawyers work and the shape of their careers. If you want to be ahead of that change you have to really think hard about how you can recruit, promote, retain and reward and continue to develop your lawyers. We want to make sure that we are set up for the changed environment as best as we can be."
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