When it comes to layoffs, why do law firms usually fire high billing associates instead of shareholders who don’t have a book of business and are under budget?

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Shareholders have shareholder agreements and to get rid of them is extremely onerous. It's much easier to layoff an associate.

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Never heard of that. Associates grinding out billables, while often mistreated, are part of the lifeblood of the firm which cannot exist without generating more money than it spends. Usually staff and high paid underperforming partners without equity are the first on the chopping block. At least that’s my perception n

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Sometimes high performing associates get pushed out or held back in mis-managed firms. This can be the case when there is a layer of under-performing income partners, which unfortunately chills or prevents the rise of stronger attorneys.

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This is the exact thing happening at my firm.

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That would be a very unusual circumstance.

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Is that really true? Things are not so simple. High billing does not mean the associate was good at their job. No point billing a bunch of hours if it’s inefficient and work product is bad and a lot of it has to be written off and/or redone. Partners without a lot of their own business may still be excellent attorneys who manage a lot of matters for other partners.

But it’s because associates are at will employees who can be fired anytime for any reason. Partners are literally owners of the firm, there’s a complicated partnership agreement involved that is not so easy to dissolve, kicking someone out of the partnership is like a divorce, messy and difficult. So they’re only going to do it if things get really dire.

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Senior associates who bill a lot of hours are the most profitable employees of any law firm. Firms also usually have a significant investment in them. They should be the last nonpartners fired, if the firm is action rationally.

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There is an attorney at my firm who bills awesome on some files. Always meets billables. But then on other files he’s completely ducked deadlines and put us in a bad spot (repeatedly) so yeah he bills well but the frustration for his other stuff is definitely a factor in how the firm looks at him.

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