​Top-tier set to launch new roles and merit-based pay

by Sophie Schroder23 Jun 2014

Top-tier Australian firm Allens is set to launch a new career framework which includes the creation of two new roles: Associates and managing associates.
From 1 July, the firm will operate under a new career framework and promote 30 lawyers to a managing associate role.
This position sits between senior associates and partners, and indicates that the individual has the potential to progress to partnership.
Jane Lewis, director of People & Development at Allens, says managing associates will be expected to play a key role in all aspects of the practice and in particular demonstrate an understanding of client and team management skills, as well as practice economics and management.
“Additional responsibilities are reflected in the remuneration,” she says. “The intent of the model is to recognise our most talented lawyers, stay ahead of the market and meet the evolving needs of clients.”
As well as this senior role, Allens will introduce a new associate role for graduate lawyers who are ready to specialise and take on greater responsibility.
These positions are just a small part of a modified career framework that the firm will follow from July, which includes giving a new definition to the title “talented lawyer”.
This will have a much greater emphasis on relationship management, commerciality and flexibility.
“[We will] move away from seniority as a key determinant of progression and remuneration,” says Lewis. “Career progression will be based on skills, competence and performance, not years of experience.”
A new approach to incentives will reward contributions across the key areas of client, people and firm, and a different approach to training and development that focuses on bringing lawyers to higher levels of competence and responsibility sooner are also features of the model, she says.
Allens decided to shake things up in response to changes in client demands and global competition, as well as the shifting expectations of lawyers in the workplace.
Australasia is certainly starting to see a trend towards changes in the structure of law firms, agrees Campbell Davidson, the Sydney office managing partner of Squire Patton Boggs.
“The legal market in Australia has undergone enormous changes over the past five years. Changes in the markets in which law firms and their clients operate require changes in the way law firms are structured,” he says. “The top-tier firms in Australia have always been very large compared to the markets which they serve. In addition to a number of Australian law firms becoming part of a global firm, the large Australian firms are becoming smaller.”
He says Squire Patton Boggs is an example of this: It is a smaller, more nimble firm that serves global, regional and domestic clients from three offices throughout the country which don’t replicate each other.
But Davidson wasn’t sure whether introducing new titles at firms will be helpful for clients, who may be wary or have a perception that this could result in fee increases for them.
“It may make sense for the partnership as an internal matter – but it doesn’t add a lot for their clients. The creation of this new position is probably partly due to the fact that there are many very good senior associates at large top-tier firms who in previous times would have been on track for partnership or would already be partners but who now face little prospect of being made up as partners, at least in the near term,” he says. “The new position may be designed to provide some recognition of the seniority of the lawyers and to assist in retaining them without having to admit them to partnership and dilute partnership profits.”
However, the president of the Australasian Legal Practice Management Association (ALPMA) Anthony Bleasdale says it makes sense for top-tiers to create new positions.
He says that by more clearly mapping career pathways, lawyers will better understand the professional development and experience required to achieve management and partnership roles at firms.
“Firms that can deliver this kind of professional development of their lawyers will be better positioned to successfully adapt to the changing legal landscape, and potentially better able to recruit and retain talented staff.”
Another consideration is that law degrees are strongly focused on developing legal expertise but don’t typically offer much exposure to the business, financial or people management skills required to successfully manage and lead law firms, says Bleasdale.
“We would welcome the creation of new roles that offer lawyers additional practice management experience, earlier in their careers and backed up with a professional development program to support the acquiring of what are essentially new skills for many lawyers.”