Re: Nonequity partner salary as draws
Posted by Bill on 12/30/07
They did not have a written contract. They were really good
friends out of law school and they trusted each other. The MP
needed a litigator to help him with a litigation case, as the
MP is more of a transactional attorney. The MP needed a stop
gap and the NEP came in to fill that role. They didn't deal
with the terms of their arrangement. It's a very small law
firm and the MP is informal about just about everything in the
office. It's good for the work environment as it's very
casual, but very little standard operating procedures or
policies -- which has now come to bite the MP for not tying
this kind of stuff down.
On 12/29/07, Curmudgeon wrote:
> What does your contract say? You DO have a written
> contract, don't you????
> On 12/29/07, Bill wrote:
>> This one nonequity partner (NEP) has been getting a
>> bimonthly salary. The first six months he had been
>> working on contingency cases. The second part of the year
>> he brought in a substantial amount of revenue. Now he
>> thinks the managing partner (MP) is stealing money from
>> him because the MP is offsetting a lot of his revenue from
>> the first half of the year where the NEP didn't produce
>> much. The NEP keeps using the phrase "I eat what I kill"
>> but seems to be really in denial that he got a guaranteed
>> salary all these months. Doesn't eat what you kill entail
>> not getting anything until you actually kill something?
>> So I asked the NEP what is your salary then? Aren't you
>> an employee? He said "no, I am a partner (he's actually a
>> non-equity member of the firm since it's a LLC - but let's
>> just stick to the partner terminology) and the salary were
>> just advances against my draw at the end of the year."
>> The guy sounds confused as he wants to benefits of the NEP
>> arrangement since he gets guaranteed salary, but wants to
>> keep his profits under the EWYK system. I don't think you
>> can pick and choose like that. Plus under the EWYK
>> system, you don't get credit for contingency cases until
>> you actually hit, right? I would appreciate some feedback
>> on this as I am not completely versed in the various law
>> firm partnership/compensation/profit models.