Tuesday, June 23rd, 2020

Retired Partners That Never Retire

“Retirement: That’s when you return from work one day and say, ‘Hi honey, I’m home forever.'” – Gene Perret

I don’t know why you call them retired partners if they are going to continue to work. I find it hard to understand why you pay them “retirement” payments and also pay them a salary to keep working.

I have always supported the practice of contracting with a partner who is being paid deferred comp to work for the firm (for a much-reduced salary) after they have transitioned their client responsibilities, for one year, if the firm actually needs them. The contract can be renewed annually. Again, with discussion and consideration among the partner group that the retired partner is actually needed.

Remember, to the outside world AND to young up-and-comers, the firm looks top heavy with partners. It is a disincentive for young people to wait years and years for a partner spot to open up.

Plus, I have observed that these “retirees” take up space, soak up administrative help, and never fully transition clients. If they are working less, they might also struggle with keeping up with the firm technology (thus relying on admin to help them).

The partner group should discuss this topic and develop a policy. If the group wants to keep them around that is, of course, their prerogative. Just make sure everyone understands how retirement works at your firm.

Marc Rosenberg calls them Double-Dippers. Read his interesting post on this topic.

  • "Working people have a lot of bad habits, but the worst of those is work."
  • Clarence Darrow

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