20-Point Partners
Addressing Underperformers
In our recent article, The Power of Continuous Accountability: Implementing a Partner Accountability System, we spoke of the increased importance of accountability for partners. It is not a stretch to connect the dots that a partner who is consistently a "20-Point Partner" is clearly an underperforming partner (some would even include "40-point partners" in the category of underperforming).
Dealing with partner performance issues is complex, and some partners may hold the view that a partner is independent and not subject to any intervention.
While many firms accept it as their fate that occasionally, a partner or two may be underperforming, the financial loss should be the least of the Firm's concerns. We would suggest that there are other more critical issues arising from allowing underperforming partners to linger on, including:
Negative impact on moral
Damage to the Firm's reputation
Threaten client retention
Loss of potential growth opportunities
It is essential, given the sensitivity and complexity, that the Partners support the Firm in its approach to dealing with underperformance issues and that it is clearly part of the Managing Partner and Management Team's mandate.
Guiding Principles
The following principles apply to management strategies and actions to resolve serious partner performance issues:
A fair and reasonable opportunity will be provided to resolve the performance or conduct issues to the Firm's satisfaction.
Management will exercise discretion in determining what is required of a partner to resolve the issues.
Timelines will be reasonable and productive bearing in mind the facts and circumstances at hand.
If additional support is required to address their issues (e.g., training, coaching, mentoring, and other support), it will be provided.
The timeline for a resolution will not constitute a "precedent" for other cases, and
Management is committed to swift action if efforts to resolve the performance issues are not achieving positive results.
Informal Resolution
The Managing Partner will initially pursue an informal resolution when performance issues are first identified. Before proceeding, they will obtain all the relevant facts and circumstances surrounding the underperformance.
The Managing Partner will work with the partner in question to reach an agreement on the specific action needed and the timetable to resolve the performance issues. The period for resolution of the performance issues must be set in the context of the particular circumstances. It will be the amount of time judged by the Managing Partner as reasonable in the circumstances for the partner to implement the agreed actions.
There will be no disclosure of any informal arrangement to the partnership.
The partner will be expected to self-monitor their progress on the action points and to keep the Managing Partner apprised of their progress towards achieving the required objectives in accordance with the agreed timetable. The Managing Partner will meet with the partner once the action plan has run its course to decide on the outcomes.
The Managing Partner may report orally at such times as the Managing Partner deems appropriate, or the Management Committee may require.
Formal Action
When faced with underperforming partners who do not respond to the attempts of informal resolution to improve their performance, firm leadership must take decisive action. By addressing these issues promptly and effectively, law firms can maintain a culture of excellence and ensure an alignment of partners with the Firm's goals and values.
The failure of informal attempts to resolve the performance issues should automatically result in formal remedial action.
At this juncture, the Managing Partner will meet with the members of the Management Committee to review the circumstances and to determine the next steps, including, as appropriate, an action plan and review process. The partner will be advised in writing, and the Managing Partner (together with others as deemed appropriate) will meet with the partner to review the performance issues that must be corrected and the timelines to be met.
The extent to which the full Management Committee may be engaged at this time will depend on the circumstances. The Partners will be advised as to the timing and extent of Management Committee involvement.
The further action plan, including the nature and timing of meetings along with reports to Management by the partner at this stage, will be reduced to writing and signed by the partner.
If the partner refuses to sign, the matter shall immediately be referred to the partnership.
The Managing Partner will make status reports and recommendations to the Management Committee as they judge appropriate in the circumstances.
If the partner fails to achieve the required outcomes, the partnership will be engaged to determine the consequences. While de-equitation, change to a non-voting partner, and changes in the form of compensation are potential options to be considered, once the informal and formal steps have been concluded without success, the partner will probably be asked to leave the partnership and the Firm.
Conclusion
By taking proactive steps to address underperformance, the problem can often be resolved in a win-win circumstance for both the partner and the Firm.
Regardless of the outcome, addressing the issue will lead to a more cohesive and productive team of partners working together toward a common goal.