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Should ‘partners on commission’ be more commonplace?

In the wake of COVID-19, and now a national recession, evolving one’s SME practice is fundamental for survival.

user iconJerome Doraisamy 25 June 2020 SME Law
Janya Eighani
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In recent months, #auslaw has seen law firms across the board forced to restructure their businesses by way of cutting partner draws, requesting salary reductions, implementing hiring freezes or furloughing staff.

In the SME and sole practitioner spaces, there have been a number of businesses and individuals that have found it difficult to pay outgoings and keep the business’ head above water, even if they have the clientele and funds in trust.

As a result, Sydney-based SME Lehman Walsh decided in early April to restructure its business and create a partners on commission strategy. Speaking to Lawyers Weekly, managing partner Janya Eighani said the strategy intended to “keep practitioners practicing during these difficult times and also makes sure that smaller clients are not left without access to legal services, simply because their lawyers are deciding to shut their doors or wind down, due to the uncertain commercial reality that COVID-19 has brought about”.

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It was designed, she noted, to ensure that smaller practices weren’t left unaided.

Given that Australia is now in its first recession in 29 years, it is a strategy that may become more commonplace, Ms Eighani said. Or, at least, “it should be”.

“Solicitors are changing their area of practice to survive. That is exciting and welcomed but at the same time a risky move. A property lawyer cannot become a commercial practitioner overnight. It takes many years of experience and it’s a risk to the quality of work and service to the client,” she explained.

“Furthermore, changing one’s area of practice for survival and not passion means a temporary relief and we will see these talented solicitors leaving the profession one after another because of lack of fulfilment and enjoyment.

“If every firm specialising in an area of practice (e.g. criminal law firms, family law firms) [starts] implementing this structure, those who specialise in these areas have a door to knock on if they are struggling.”

This is not to say, however, that adopting such a strategy is without its challenges for SMEs who are willing to take on those burdens.

“The recruitment process was challenging. The new structure was never advertised before and could not follow the [traditional] module of advertising. We are still continuing our recruitment process and although it seems that many have already lost faith in continuing their career, many are interested in joining the team and continuing their career under the umbrella of Lehman Walsh Lawyers,” she recounted.

The idea of the new structure, Ms Eighnai outlined, was to “share what we have with those in need within the profession”.

“If solicitors are kept alive, the barristers will be briefed and kept alive, the system will continue and the profession will thrive. It has a domino effect. The challenges have been to apply the new structure to many who are reluctant to accept change,” she posited.

“Continuous mentoring, support and regular [face-to-face] meetings have assisted in reassuring all that we are in it together and although we are all accepting less to stay alive, we are doing it together and contributing to the bigger picture, that is the survival of the profession during these tough times.”

Looking ahead, Lehman Walsh is working on a new structure for less senior solicitors who are also struggling and wish to depart from the traditional practice, Ms Eighani said.

“Those who have ambitions of opening their own firm but are afraid of the uncertainty of the future, our doors are open to all who wish to have a chat about their career and those who are disheartened by the COVID-19 situation and have lost hope in their career as a solicitor,” she said.

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