What is the difference between a “Partner”, “Executive Partner”, and “Managing Partner” in a law firm?
If you’re thinking about creating a partnership, there are many types of partnerships to choose from.
In this article, let’s examine the benefits and ky features of a law firm partner, law firm executive partner and a law firm managing partner.
What Does “Making Partner” Mean?
First, let’s take a look at the meaning of “making partner.”
If you haven’t started your own law firm and you are not already a partner, you may likely be considered as an employee or associate for a law firm. In this position, you wouldn’t have ownership of the law firm but you would be permitted to practice law.
Starting as an associate or an employee of a law firm is a great way for fresh graduates and inexperienced lawyers to learn the ropes and become acquainted with the world of law. Your time will be spent training and you won’t be providing any “billable” hours.
When you’re ready to make the transition into a partnership, this is when you’ll earn a higher salary, become a partial owner of the firm, take on greater responsibilities and liabilities, and also receive a portion of the firm’s profits.
The structure of any partnership will vary depending on how it is incorporated and you can learn more about that in Starting A Law Firm.
Law Firm Partner
Joining a starting your own law firm or joining as a partner will immediately place more work, responsibility and liability on your career. The skills and experiences you acquired as an associate can now be put into practice at a high frequency and a much greater pay bracket.
In regards to compensation, partners can be paid in a variety of ways. You may receive a salary or receive a more common method of withdrawal from a pool of profits. Other methods can include earnings that are based entirely on the clients you secured and provided legal services for yourself.
When becoming a partner for a law firm you will receive a well-written contractual agreement outlining all the terms and conditions of your partnership. Inside this contract may be things like:
- Required capital contributions
- Amount of profit a partner can draw and how often each receive it
- Salary and payment schedule
- Penalties for leaving the partnership
- Partnership authority
- Clauses defining death and disability
- Procedures to resolve disputes between partners
- Descriptions of roles, responsibilities, and accounting information
Law firm partnerships requires delicate consideration, strategic negotiations, and careful decision making. Think of joining a partnership as getting married for a certain period of time. You’ll want to know exactly who you are going to be partnered with, how they operate, what they believe in and most importantly the “marriage” rules that will influence your practice for years to come.
If joining a partnership is in your best interest, you may want to consider becoming an executive partner or a managing partner at a law firm.
Law Firm Executive Partner
As an executive partner at a law firm, you’ll take on many a distinct role in leadership and take on many of the major decisions that affect the fate and future or a law firm.
Executive partner’s require extensive insight which will support the growth of the law firm’s objectives and goals.
The responsibilities of an executive director include the overall management strategy, financial management, social accountability, workplace compliance, etc. The executive partner will be dedicated toward preserving and promoting the way the firm practices law and makes critical decisions regarding. The scope of work focuses primarily on short and long term operational decision. In comparison, a managing partner will be dedicated toward high level management decisions and strategic issues.
Executive partners take on most of the administrative duties in the firm to ensure that operations run smoothly. They also perform functions in accordance to the principles and rules the firm has in place. The executive partner will often be elected from a committee managing partners and other high positioned investors in the law firm.
If you’re being considered as an executive partner of a law firm or seeking this position, the overall success of the firm will be entirely up to you.
Law Firm Managing Partner
Before becoming an executive partner at a law firm, it may be in your best interest to become a managing partner.
Managing partners for a law firm are responsible for the overall operations of the firm. This includes delegating responsibilities to attorneys, secretaries, firm executives, paralegals and other employees at the firm.
Managing partners, much like executive partners, can be responsible for developing the strategies and defining the goals for the long-term success of the law firm.
Decisions regarding the cases the law firm will take on and which clients the firm will represent is one of the roles of a managing partner. They will also be required to ensure compliance with professional standards while following government laws and regulations.
Here’s a detailed list of skills required from a managing partner:
- Financial planning and strategy
- Legal compliance
- Client relations
- Decision making
- Strong verbal communication
- Strong written communication
- Delegating tasks
- Improving operations and processes
- Legal website design
- Profitability management
Becoming a managing partner takes you away from the legal caseloads and into the back-end operations of the law firm. The workload is significantly greater and the responsibilities differ than a partner at a law firm.
To summarize the job description of a managing partner, they focus on the relationship side of the law firm and how to effective serve their clients.