Recruiters Are Playing Dirty in the Push for Private Equity Talent
U.K. partners say recruiters are using deceptive tactics in the heated hiring market.
July 30, 2019 at 03:29 PM
4 minute read
The original version of this story was published on The American Lawyer
Agents often get a bad reputation. During property booms, there have been cases of real estate agents telling buyers a house is on the market when it isn't so they can make an approach to the owner with a potential offer. Sports agents are sometimes accused of suggesting a club might be interested in signing a player, just to see if the player is keen.
But few would have thought that similar tactics would ever enter the legal recruitment market in a major way.
And yet it seems they have. The hiring market for private equity partners in London is so hot at the moment that lawyers are complaining of similar behavior.
Some private equity partners complain about being marketed by recruiters without their permission. One says he received a call from a friend at a rival firm asking if it was true that he was on the market. The partner in question had just been marketed by a recruitment agent with whom he had not even spoken.
Partners add that they are also being approached about joining firms that recruiters haven't been mandated by.
One law firm head says he sometimes gets approached about specific partners with whom a recruiter may or may not have spoken. He has to explain to the recruiter that he is happy for them to signal that the firm may be interested in the partner, but that they must make it very clear they are not being mandated by the firm and they must not approach other partners. "It's like talking to children," he says, adding that they typically still do approach others.
The incentive for agents to operate in this way is clear. Recruiters typically stand to receive a fee that is 25% of the annual remuneration of a person they place. For highly sought-after individuals, this can be quite profitable for the agents involved, so it is perhaps understandable that they would do whatever they can to get in ahead of their rivals.
The tactics are not all that new and by no means confined to just private equity, but the surge in private equity work and subsequent hiring war has magnified the effect in that sector and attracted attention.
Partners are understandably frustrated, as are those responsible for hiring. No one wants to appear like they're making multiple approaches, lest they appear slightly desperate.
Some recruiters also feel resentful of their counterparts' actions because they risk being tarred with the same brush.
"We are aware that this happens, and it is very bad for the industry because when we call them up there is always something to overcome," says Scott Gibson, a recruiter at Edwards Gibson.
And yet, while one recruiter called the behavior "disgraceful," there also seems to be a grudging acceptance that this is simply a function of a manic hiring market. In the last few months alone, private equity hires have been made in Europe by the likes of Kirkland & Ellis; Clifford Chance; Simmons & Simmons; Weil, Gotshal & Manges; Akin Gump Strauss Hauer & Feld; Vedder Price; and Willkie Farr & Gallagher.
This is not a practice area in which firms want to be only a little bit larger. Private equity has come to dominate corporate transactions in a way no one expected a decade ago. Not only do buyout firms offer a steady stream of M&A mandates, they also provide opportunities for restructuring, finance, tax and property departments. Any partner with links to such influential clients will be highly sought after.
One private equity partner says demand is so strong you would have to be "comatose" for a firm not to be interested in hiring you at the moment.
Good news for the agents maybe, but such dirty tricks are certainly not a welcome market development.
Email: [email protected]
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllHSF Locks In Its American Dream. But What Will a U.S. Merger Mean For its Asia Practice?
Trending Stories
- 1Dog Gone It, Target: Provider of Retailer's Mascot Dog Sues Over Contract Cancellation
- 2Lululemon Faces Legal Fire Over Its DEI Program After Bias Complaints Surface
- 3Plaintiff Gets $500K Policy Limit Without Surgery
- 4Philadelphia Bar Association Executive Director Announces Retirement
- 5SEC Chair Gary Gensler to Resign on Trump's Inauguration Day
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250