Editing Law firm (section)

==Structure and promotion==

===Partnership===
Law firms are typically organized around [[partner (business rank)|partners]], who are joint owners and [[board of directors|business directors]] of the legal operation; [[associate attorney|associates]], who are [[employee]]s of the firm with the prospect of becoming partners; and a variety of staff employees, providing [[paralegal]], clerical, and other support services. An associate may have to wait as long as 11 years before the decision is made as to whether the associate is made a partner. Many law firms have an "[[up or out]] policy", integral to the [[Cravath System]], which had been pioneered during the early 20th century by partner [[Paul Cravath]] of [[Cravath, Swaine & Moore]], and became widely adopted by, particularly, [[white-shoe firm]]s;<ref>Robert L. Nelson, ''Partners With Power: The Social Transformation of the Large Law Firm'' (Berkeley: University of California Press, 1988), 71-72.</ref> associates who do not make partner are required to resign, and may join another firm, become a solo practitioner, work in-house for a corporate legal department, or change professions. [[Burnout (psychology)|Burnout]] rates are notably high in the profession.<ref>Michael H. Trotter, ''Profit and the Practice of Law: What's Happened to the Legal Profession'' (Athens, GA: University of Georgia Press, 1997), 83.</ref>

Making partner is very prestigious at large or mid-sized firms, due to the competition that results from higher associate-to-partner ratios. Such firms may take out advertisements in professional publications to announce who has made partner. Traditionally, partners shared directly in the profits of the firm, after paying salaried employees, the landlord, and the usual costs of furniture, office supplies, and books for the [[law library]] (or a database subscription). Partners in a [[limited liability partnership]] can largely operate autonomously with regard to cultivating new business and servicing existing clients within their [[book of business (law)|book of business]].

Partner compensation methods vary greatly among law firms. At major United States law firms, the "compensation spread" (ratio between the highest partner salary and lowest partner salary) among firms disclosing information ranges from 3:1 to 24:1. Higher spreads are intended to promote individual performance, while lower spreads are intended to promote teamwork and collegiality.<ref>{{Cite news|url=http://abovethelaw.com/2013/06/which-firms-have-the-biggest-gaps-between-their-highest-and-lowest-paid-partners/|title=Which Firms Have The Biggest Gaps Between Their Highest- and Lowest-Paid Partners?|last=Lat|first=David|work=Above the Law|access-date=2017-03-13|language=en-US}}</ref>

Many large law firms have moved to a two-tiered partnership model, with [[Equity partner|equity and non-equity partners]]. Equity partners are considered to have ownership stakes in the firm, and share in the profits (and losses) of the firm. Non-equity partners are generally paid a fixed salary (albeit much higher than associates), and they are often granted certain limited voting rights with respect to firm operations.

The oldest continuing partnership in the United States is that of [[Cadwalader, Wickersham & Taft]], founded in 1792 in [[New York City]]. The oldest law firm in continuous practice in the United States is [[Rawle & Henderson]], founded in 1783 in [[Philadelphia]].

==== Termination of one's partnership ====
It is rare for a partner to be forced out by fellow partners, although that can happen if the partner commits a crime or malpractice, experiences disruptive mental illness, or is not contributing to the firm's overall profitability. However, some large firms have written into their partnership agreement a forced [[retirement age]] for partners, which can be anywhere from age 65 on up. In contrast, most corporate executives are at much higher risk of being fired, even when the underlying cause is not directly their fault, such as a drop in the company's stock price. Worldwide, partner retirement ages can be difficult to estimate and often vary widely, particularly because in many countries it is illegal to mandate a retirement age.<ref>{{cite web|title=Harvard Law Program on the Legal Profession Comparative Analyses of Legal Education, Law Firms, and Law and Legal Procedure|url=http://www.law.harvard.edu/programs/plp/pages/comparative_analyses.php}}</ref>

==="Of counsel" role===
In the United States, Canada and Japan, many large and midsize firms have attorneys with the job title of "counsel", "special counsel" or "[[of counsel]]". As the [[Supreme Court of California]] has noted, the title has acquired several related but distinct definitions which do not easily fit into the traditional partner-associate structure.<ref>See ''People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc.'', [http://online.ceb.com/calcases/C4/20C4t1135.htm 20 Cal. 4th 1135], 1152-1153 (1999).</ref> These attorneys are people who work for the firm, like associates, although some firms have an [[independent contractor]] relationship with their counsel. But unlike associates, and more like partners, they generally have their own clients, manage their own cases, and supervise associates. These relationships are structured to allow more senior attorneys to share in the resources and "brand name" of the firm without being a part of management or profit sharing decisions. The title is often seen among former associates who do not make partner, or who are laterally recruited to other firms, or who work as in-house counsel and then return to the big firm environment. At some firms, the title "of counsel" is given to retired partners who maintain ties to the firm. Sometimes "of counsel" refers to senior or experienced attorneys, such as foreign legal consultants, with specialized experience in particular aspects of law and practice. They are hired as independent contractors by large firms as a special arrangement, which may lead to profitable results for the partnership. In certain situations "of counsel" could be considered to be a transitional status in the firm.

===Mergers and acquisitions between law firms===
Mergers, acquisitions, division and reorganizations occur between law firms as in other businesses. The specific books of business and specialization of attorneys as well as the professional ethical structures surrounding conflict of interest can lead to firms splitting up to pursue different clients or practices, or merging or recruiting experienced attorneys to acquire new clients or practice areas. Results often vary between firms experiencing such transitions. Firms that gain new practice areas or departments through recruiting or mergers that are more complex and demanding (and typically more profitable) may see the focus, organization and resources of the firm shift dramatically towards those new departments. Conversely, firms may be merged among experienced attorneys as partners for purposes of shared financing and resources, while the different departments and practice areas within the new firm retain a significant degree of autonomy.

Law firm mergers tend to be [[assortative mating|assortative]], in that only law firms operating in similar legal systems are likely to merge. For example, U.S. firms will often merge with English law firms, or law firms from other common law jurisdictions. A notable exception is [[King & Wood Mallesons]], a multinational law firm that is the result of a merger between an Australian law firm and a Chinese law firm.

Though mergers are more common among better economies, slowing down a bit during recessions, big firms sometimes use mergers as a strategy to boost revenue during a recession. Nevertheless, data from Altman Weil indicates that only four firms merged in the first half of 2013, as compared to eight in the same period in 2012, and this was taken by them as indicating a dip in morale regarding the legal economy and the amount of demand.<ref>{{cite web|url=http://www.jdjournal.com/2013/05/16/despite-rising-economy-law-firms-remain-demoralized/|title=Despite Rising Economy, Law Firms Remain Demoralized - JD Journal|author=Daniel June|date=16 May 2013|work=jdjournal.com}}</ref>