Work issues

[67walkon]

This is just a good place to vent while I'm at work and not feeling very productive. Work is a small lawfirm with 7 lawyers. I'm second most senior, just turned 62 and have been planning on going part time next year. The main reason for staying on part time is to keep some benefits, like life insurance.

It's getting harder and harder. Our profession and our firm in particular has struggled for several years. Last year was the worst year we've had in memory. This year has been good because of a big fee we got earlier in the year. But on a week to week basis, it is always a financial struggle.

Myself and the one guy who is older have been taking more time off than the people who are 10 to 12 years younger than us. I've had about 5.5 weeks of vacation and the other guy 7 or 8. We work fewer hours but generally bring in a lot more money. The problem that is cropping up is that we haven't been making enough on a regular basis to pay ourselves regularly. We've missed 3 out of the last 4 regular weekly draws/paychecks, but we also have already made a lot more than we made all of last year. The younger guys are grumpy and resentful, even though they get equal shares of income, about us taking more time off, but the same younger guys haven't done what they should have done to prepare themselves for us older ones leaving.

I could walk today and be fine. Keeping the insurance until I hit medicare would be nice, but not necessary. Frankly, working without getting regularly paid isn't any fun anyway.

I don't really have any questions. It's just one of those Monday when I wish I wasn't here.

 

[MichaelB]

Sounds like more than just monday morning blues. At 63 /12 you can quit and take cobra, which will carry you through Medicare (spouse may be different). It won't pay but at least you are guaranteed issue.

Frankly, working without getting regularly paid isn't any fun anyway. .

I don't remember it ever being fun...

 

[flyfishnevada]

I read stuff like this and wonder why you do it? Insurance is nice, but so is enjoying you're life. You gotta do what you gotta do, but if it were me I'd be out of there. I hope it all works out.

 

[Texas Proud]

Just curious why you and the older partner can bring in more money than the younger ones

Is it you have a higher billing rate? Have more clients? Are better lawyers? There has to be a reason and that is where I would focus...

I would think you could come to an agreement on work/salary with the others... IOW, if you work part time your % is dropped...

 

[Animorph]

Do you have an ownership stake in the firm? In that case I'd spend some time prepping the young guys to take over. They sound more like employees than partners. If not, then an exit strategy would be nice and the young guys can grow up on their own or join another firm if they don't like it. It doesn't really sound like a going firm if the two senior guys leave, unless the economy improves their business.

 

[W2R]

Sounds like a miserable situation. You do need continuous health insurance but from your original post I am thinking that maybe you already have that covered.

You don't need the stress and negativity you are exposed to at work, that's for sure. Nobody does. Retirement is great.

 

[Katsmeow]

I am an attorney. My situation is a little different -- the firm is a little larger but not huge and I was never one to bring in business (or want to).

I was able to move to a part time status a year and a half ago. I was originally going to entirely retire (56 at the time) but was asked to stay on very part time. In my case, I did not have responsibility to bring in business but I was asked to stay on to consult/assist with other attorneys. Basically I was able to set it up where I worked only on the parts of my job that I enjoyed doing and I eliminated the stress from working full time. I made it clear the parts of the work that I didn't want to do. It has been a year and a half and I work about 2 days a week and it has gone well.

It has gone really well for the last 18 months and I've found that I don't actually mind working if doing the part of the work that I enjoy. I was perhaps lucky that I could pick and choose the type of tasks that I want to do. If I had responsibility to bring in business or had to do everything (even on a part time basis) I wouldn't want to do it.

 

[marylandcrab]

I'm not a lawyer, but a small biz owner and I get the pain. I haven't been paid "normally" since May. "Regular" people will never get what it's like to have a job where you can bust your butt, and not be able to receive a paycheck in order to pay the bills and keep the biz going.

It sounds like the younger ones will need to start stepping up soon. And when you've had enough, I'd say pull the plug and enjoy the rest of your life, they will make it or they won't and I wonder at what point it won't be worth it for you.

 

[DangerMouse]

Unless the laws have changed, small companies are exempt from having to offer Cobra aren't they? We were in that situation with one of DH's former employees, because they only had X amount of employees they did not have to provide the ability for COBRA coverage.

 

[Texas Proud]

Unless the laws have changed, small companies are exempt from having to offer Cobra aren't they? We were in that situation with one of DH's former employees, because they only had X amount of employees they did not have to provide the ability for COBRA coverage.

That would be an interesting question... but I work for a small company and we offer COBRA... and I thought that we had to...

From our viewpoint it is nothing... right now we do not have anybody on COBRA... but when we do all we have to do is make sure they are listed on the insurance and deposit the check the company that manages our COBRA sends us... they send all paperwork, fill out all forms, etc. etc... well, I guess we also have to inform them of our rates every year...

 

[67walkon]

We do have to offer COBRA. The problem has always been that myself and the other "older" guy were once the "younger" guys. Back then, we were strongly encouraged to do the typical things that help generate business. We're both board certified, in different areas of the law, and know more people. The firm had a little bit of a leadership issue when we were in our 40's, so the younger guys didn't do the things we had to do and the then managing partner let a lot of stuff slide. As a result, when that older guy left, the guys 10 to 12 years younger people were pretty well set in their ways and aren't going to change. They're happy, or have been, just coming to work 8 hours a day, doing their job and not doing anything to generate work. We're all equal partners and it's worked out because the other older guy and I generate a lot of little business for the other guys and I seem to generate a really big case every couple of years and do regular cases in between. "Big" in our world is anywhere from a fee of $200,000 and up; this year's "big" was about $800,000, but that's the biggest single fee ever. We just pay whatever bills we have when those come in and split the rest. I don't expect, by the way, to have any more that are that big unless I decide I want to bust my little work butt for the next 4 or 5 years and I don't want to or need to.

Now, I think the younger guys are blaming the lack of regular paychecks on us older guys taking off more than a couple of weeks vacation a year. To compound it, my wife and I are notorious LBYMers and she inherited a little bit, so we have very good savings and a few nice assets we've accumulated over the years. One of the younger guys has made the same as me the last 5 to 10 years and hasn't saved a tenth of what I have--his wife likes to spend money more than mine does.

I'm committed to December 31. AFter that, it's part time or no time. If I can't work out a part time deal, it will be okay for me but I don't want to hurt a firm I've been with for 35 years.

It's good to be able to vent to someone other than my wife!

 

[Texas Proud]

I am sure you have thought about this.... but some more questions..

If you share the profits equally, then what happens on Jan 1 if you stop working Are they going to close the partnership and write up a new one? Or, do you still get your share? Then again, are you in a partnership or some other legal entity? To me, your investment has value and you should be able to get your value out even if you stop working...

The other option I see if you just be the rainmaker... when I was at an accounting firm we had partners who knew nothing about taxes etc., but handled the clients and got paid the big bucks... because they knew how to keep the clients happy and hired people to do the work.... not a bad gig if you like this kind of 'work'...

 

[traineeinvestor]

Another private practice lawyer here.

If your decision is a firm "part time or no time" after 31 December this year, I'd be laying the groundwork for getting the continuing partners to support a part time role (either as partner or consultant). If the younger generation is not bringing in revenues, then one of three things is going to happen:

1. you (+ the other rainmaker) leave and the firm will shut down for want of revenue, leaving the younger partners in need of alternative employment;

2. you leave and the younger partners step up and start generating enough revenue without your input - this will require a change from historical experience;

3. you reach an agreement with the younger partners which sees you continue in a part time role focused on maintaining and transiting relationships to the younger partners.

Unless the younger partners really believe that they can generate revenues, they'll either go along with what you want or reach the conclusion that the partnership will have to be wound up. In a relatively small partnership, there will also be concerns that, if enough partners leave, the remaining partners will face increasing business risk in the form of overheads which are unsustainable. Presumably, the firm has sufficient capital/cash to cover the costs of winding up should it become necessary?

I assume there is nothing in your partnership deed about a soft landing?

Lastly, your partnership deed will probably have a minimum notice period for resigning? Sometimes these are quite long - mine is six months but in practice they will let me go as soon as I can arrange an orderly handover of files if I wish.

 

[FreeAtLast]

It does not sound like there is going to be a happy ending once you depart. But who knows? Some one may be able to take charge and do what is necessary to generate the business.

 

[chinaco]

IMO - In a small business, one has to be transparent about their future plans (i.e., retirement) and work out a succession plan.


You (an your partners) need to formalize the market and management roles (and compensation) and get together a succession plan so there is some continuity. You might consider instituting bonuses for business that is developed that is over a certain dollar amount. The rest of it is confidence, skill, and attention to the marketing/business development role!!!

Otherwise, your little firm may fold. If you cannot do it, you might consider finding another firm to merge your partners and existing business into.

I suspect, given the chance, you will find someone in your partnership that is willing to lead the partnership into the future. But it may require a couple of years of mentoring and cultivation.

 

[MichaelB]

We do have to offer COBRA. The problem has always been that myself and the other "older" guy were once the "younger" guys. Back then, we were strongly encouraged to do the typical things that help generate business. We're both board certified, in different areas of the law, and know more people. The firm had a little bit of a leadership issue when we were in our 40's, so the younger guys didn't do the things we had to do and the then managing partner let a lot of stuff slide. As a result, when that older guy left, the guys 10 to 12 years younger people were pretty well set in their ways and aren't going to change. They're happy, or have been, just coming to work 8 hours a day, doing their job and not doing anything to generate work. We're all equal partners and it's worked out because the other older guy and I generate a lot of little business for the other guys and I seem to generate a really big case every couple of years and do regular cases in between. "Big" in our world is anywhere from a fee of $200,000 and up; this year's "big" was about $800,000, but that's the biggest single fee ever. We just pay whatever bills we have when those come in and split the rest. I don't expect, by the way, to have any more that are that big unless I decide I want to bust my little work butt for the next 4 or 5 years and I don't want to or need to.

Now, I think the younger guys are blaming the lack of regular paychecks on us older guys taking off more than a couple of weeks vacation a year. To compound it, my wife and I are notorious LBYMers and she inherited a little bit, so we have very good savings and a few nice assets we've accumulated over the years. One of the younger guys has made the same as me the last 5 to 10 years and hasn't saved a tenth of what I have--his wife likes to spend money more than mine does.

I'm committed to December 31. AFter that, it's part time or no time. If I can't work out a part time deal, it will be okay for me but I don't want to hurt a firm I've been with for 35 years.

It's good to be able to vent to someone other than my wife!

If you leave you're not hurting anyone. You'll never know what the younger partners can do until they have to deliver and as partners they are all responsible for their own destiny. Thinking "they can't survive without me" is a great way to talk your self into staying. If you are prepared to work part time then give plenty of notice and start working toward that. Year end is less than 9 weeks away...

 

[67walkon]

I've told them this is coming, but I haven't tried to work out a formal agreement. I've been trying for years to get them to start laying out a business plan for the transition of them becoming the "senior" guys, but they just won't do it. I've suggested looking seriously at one of the merger deals bigger firms have proposed, but I guess its too much fun to be self employed. Plus, the last 3 or 4 years have been very financially difficult so for the most part its been a struggle. Nobody likes to plan when they're living under that kind of pressure.

Somebody once described lawyers as "finders", "minders" and "grinders". I've never been a great rain maker, but I get a lot of repeat business from past clients and a lot of referals from lawyers. Our younger guys have been "grinders". Frankly, I just turned 62 and I'm never again going to be a "grinder", billing 2,000 or whatever hours a year. I don't need it and I have too many other things to do.

It'll work out. Nobody can make any of us work, even if there is a notice requirement. They might be able to take something away, but so what? Our buyout is based on book value and the book value of a small firm's corporate stock isn't much. I could care less about the book value of the stock.

And yes, we would have to work out a new agreement. I'm proposed to work about 2/3's time and receive 1/2 compensation, plus the benefits.

Sometimes it feels good to vent in an anonymous manner.

 

[Texas Proud]

Good for you....


If it were me.... I would make the agreement based on the number of billable hours... say 1,000 or so.. heck, maybe 750 is all you want to do... I don't know how much non-billable you do, but I would make sure that goes down also...

OR, just bill 500 hours and become the office manager etc... take as much of the non-billable stuff off of the others and let them 'grind' away...

 

[pimpmyretirement]

And yes, we would have to work out a new agreement. I'm proposed to work about 2/3's time and receive 1/2 compensation, plus the benefits.

This presumes all the work you do is equally valuable, which could be selling you short. It is likely the first 50% of your working time probably generates significantly more than 50% of your value for the firm.