Law Firm Management

Law Firm Compensation Systems: Getting What You Pay For

I was once hired at a firm to replace a much more senior corporate lawyer who I will call Carl.

One of a number of things which Carl had done to cause the firm to search for a replacement was that he had gamed the compensation system. Under that system, Carl was paid a bonus based on a percentage of his billings, without reference to collections. This would be a fatal flaw in any compensation system, but at the time the firm was new to that type of thing and had not yet figured that out.