'Downsized' partners may bring ADEA suits; dismissed partners who can be characterized as employees may claim age discrimination

Article Abstract:

The case law shows that the existence of a remedy for downsized law partners under the Age Discrimination in Employment Act (ADEA) will turn on whether or not they are considered employees of the firm. Judicial analysis of this issue has focused on the right to a share of firm profits. When a partner was paid a simple salary which did not depend on the firm's success, an employment relationship was said to exist. Prudent law firms will have releases from ADEA liability for partners to sign. Guidelines for drafting such a release are given.

United States, Laws, regulations and rules, Remedies, Age discrimination, Downsizing (Management)

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Two-tiered partnerships proliferate

Article Abstract:

Law firm downsizing due to recession leads in some law firms to the creation of two-tiered partnerships. These have income partners at an intermediate level between associates and traditional equity partners. Some law firms have found income partnership a good alternative to terminating talented associates who may not meet all equity partnership criteria. Income partnership can also be a stepping-stone to equity partnership. Income partners do not share in the profits of a firm but are free from personal liability for its losses.

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