Becoming a partner at a Biglaw firm is often seen as the ultimate achievement in the legal profession. While many assume it guarantees long-term financial security—especially given the impressive profits per partner at top firms—new reports suggest the reality is more complicated.
According to American Lawyer, anywhere from 10% to 30% of partners see their compensation reduced each year. Consultant Blane Prescott noted it’s “not at all unusual” for 20% to 30% of partners to earn less annually, with firms increasingly adjusting compensation downward for some partners to free up more funds for top performers.
This doesn’t necessarily mean those partners are being pushed to leave, Prescott explained, but rather that pay is being more closely tied to performance. Other consultants say the cut typically impacts closer to 10% of partners, though this practice was rare before the 2008 financial crisis.
Kristin Stark of Fairfax Associates said it reflects the fact that law firms’ financial success in recent years has boosted even those who weren’t bringing in much business. Many mid- and lower-performing partners have still seen significant gains, benefitting from what she described as a “peanut buttering” effect—profits being spread across the partnership.
Still, consultants like Matthew Bersani of Cliff Group argue that reducing shares or “points” is necessary when a partner’s revenue doesn’t justify their payout. Once considered a signal to leave, such reductions are now common and don’t necessarily mean a partner’s career at the firm is over.
So while Biglaw partnership still comes with prestige and strong earning potential, the compensation model is shifting to reward performance more directly—though some degree of collegiality remains.