Several firms have cut or delayed partner payouts.

Being the first to have your pay cut is not nice in any circumstances, but amid the pandemic crisis several law firm partners are speaking out in favour of the move.

Steps taken by firms to maintain a healthy business to date have included furloughing staff, asking partners to contribute capital to the business, and freezing pay rises and bonuses.

But it is cutting or delaying distributions to partners that seems to have the most support, even from among those affected.

One partner at a U.K.-headquartered firm that has made changes to its partners distributions says that it is "entirely prudent for a firm to take that step".

"My impersonal view is that if you are a firm with a distribution date coming up, I don't see why you would make that distribution," they add.

"It all comes down to being a partnership and working in a socially cohesive way with the rest of the firm. You behave in a way you'd want to be remembered for."

"You behave in a way you'd want to be remembered for"

Another partner at a Magic Circle firm says that they would prefer that the responsibilities to keep firms ticking over should sit more with the partnership in order to protect other firm employees, saying: "It's us that really ought to take the weight of the pain on this."

They acknowledge, however, that if the pandemic goes on for longer than expected, "even individuals like me can eventually get into a position where things would get difficult".

Firms that have cut or delayed partner drawings so far to limit the impact of COVID-19 on their balance sheet include the likes of Freshfields Bruckhaus Deringer; Allen & Overy; Linklaters; Herbert Smith Freehills; Bryan Cave Leighton Paisner; and Simmons & Simmons.

"If Freshfields feels the need to do it, why the hell aren't we doing it too?"

One partner at a global firm believes that despite the firm's hedging as an international, full-service business, it should take a "harder approach" to the firm's finances, adding that they would "certainly stop the bonus distributions" as it would "send a good message to our staff that we are taking this seriously" and not taking bonuses at their expense.

And, they say: "If Freshfields feels the need to do it, why the hell aren't we doing it too?"

One partner at a U.S. firm in London believes that retaining distributions is possibly more needed at U.K. firms, which tend to pay out to partners on an accrual, rather than collection basis — meaning that U.K. firms may have budgeted for more client bills to have been collected than are likely to come in as businesses tighten their belts during the global lockdown.

Across the whole market, one thing does seem fairly certain: it is better to be safe than sorry when it comes to the health of the business.

But clients say that they will be watching how firms respond to this crisis, with the legal head of betting company GVC Holdings saying that customers may look unfavorably upon firms that look to cut staff rather than eat into partner profits.

The Magic Circle partner acknowledges that while it can be difficult to see the driving forces for new financial measures from the outside looking into a firm, they hope clients will look at law firms and think that their response was reasonable and proportionate.

"I hope at the end of this, clients will look at the professional services industry and think that we handled this as well as we could have."

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