Compensation Design for Law Firms

Expert views on to compensation design, profitability and client and priority alignment

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  • Publication date: January, 2014
  • Pages: 68
  • ISBN: 9781783581054
  • This book will develop SRA competency:


The legal industry has undergone massive change due to economic conditions, changing client behaviours, and technological advances – to name but a few of the major sources of disruption to traditional legal practices. Possibly for the first time in several decades, a comprehensive rethinking of how legal work is priced and staffed and how lawyers should be evaluated and compensated is underway amongst US firms. Partner compensation, as well as proper pricing and budgeting of work, must be brought into line with what delivers the best results for clients – yet firms are often confused when it comes to aligning compensation with firm goals and client expectations.

This report provides expert views from well-known industry experts to answer important questions such as:

• How a law firm can align a compensation system with strategic goals;
• How to align profitability and compensation plans;
• How to align compensation with client priorities; and
• How different pay for performance schemes can be used.

Unique selling points:
• The report contains articles from well-known and respected experts who are regularly consulted on law firm compensation – the report brings together their thoughts and advice in one publication
• The articles have been specifically written for senior partners/management who wish to examine the effectiveness of their current compensation systems and it will help them understand:

  • How to measure the firm’s compensation acumen
  • The questions that need to be asked and the main criteria the firm needs when setting a compensation plan
  • How to align compensation with firm goals and strategy
  • How to align compensation with profitability
  • How to align compensation with client priorities

• Suggested approaches to compensation have been provided by different contributors – as one size does not fit all – and firms can review the options available to them
• The report places compensation alongside another crucial issue in law firm management at the moment – pricing ¬– and provides advice on ways to adapt compensation with pricing
• As a comparison, the report provides insight into compensation schemes in accounting firms and shows the methods that are effective in other professions


Chapter 1: Partner compensation: An in-depth survey by Major, Lindsey & Africa

Chapter 2: Compensation: You may just get what you pay for

Chapter 3: Compensation: Ask why, not how

Chapter 4: Identifying and defining criteria for determining partner compensation

Chapter 5: Compensation systems: Integrating partner incentives with firm goals

Chapter 6: Pricing, profitability, and compensation

Chapter 7: Aligning your firm’s compensation system with client priorities

Chapter 8: Compensation best practices

Chapter 9: Aligning compensation to firm initiatives – What can law firms learn from accounting firms?


Check our Executive Summary and full table of contents here


August Aquila
Internationally known speaker, consultant, and author
Thomas Berman
Founder, Berman & Associates
Toby Brown
Toby is the director of strategic pricing & analytics for Akin Gump. In this role Toby works with firm partners and clients in developing pricing arrangements and service delivery models that drive successful relationships. Prior to this, Toby served in similar roles for both Vinson & Elkins and Fulbright & Jaworski, where he also drove knowledge management (KM) initiatives and various marketing efforts. Before joining Fulbright, Toby served as the communications director for the Utah State Bar. In his tenure with the Bar, he also served as the CLE, access to justice and programs director.Toby presents nationally on legal pricing, marketing, technology, and law firm management for associations, law firms, legal departments, law schools, and paralegal programs. He has also published numerous articles on these topics. Toby has served on a number of legal services boards, bar association task forces, and legal market organizations. He received the Peer Excellence Award, the President’s Award, and the Anne Charles Award from the National Association of Bar Executives. Toby maintains the ABA award-winning 3 Geeks and a Law Blog along with two colleagues, and can be found on LinkedIn.  
James D. Cotterman
Principal, Altman Weil, Inc
Arthur G. Greene
Principal, Boyer Greene LLC
Jeffrey A. Lowe
Global practice leader, Major, Lindsey & Africa’s Law Firm Practice
Joel A Rose
Joel A. Rose is a Certified Management Consultant and president of Joel A. Rose & Associates, Inc., management consultants to the legal profession. The firm, national in scope, is headquartered in Cherry Hill, New Jersey. Joel received a B.S. from New York University and an M.B.A. from the Wharton Graduate School of Business, University of Pennsylvania. He has extensive experience consulting with private law firms and government agencies. Joel performs and directs consulting assignments in law xiv About the authors firm management and organization, strategic and financial planning, lawyer compensation, the feasibility of mergers and acquisitions and marketing of legal services. He has extensive experience planning and conducting retreats and special expertise resolving problems among and between lawyers. Joel’s articles on law office management and economics appear in the Philadelphia Legal Intelligencer, the Pennsylvania Law Weekly, the New Jersey Law Journal, the New York Law Journal, publications of the Association of Legal Administrators, and other state and local bar association journals. Joel wrote the chapter, “Identifying and Defining Criteria for Determining Partner Compensation”, in the publication, Compensation Design for Law Firms, and the chapter, “Components of a Well Conceived Partner Compensation System”, in the book Compensation Re-design for Law Firms, both published by The Ark as US pub Group. Joel is on the Board of Editors of Accounting and Financial Planning for Law Firms and Law Firm Partnership and Benefits Report. Joel is a member of the Law Practice Committee of the American Bar Association.
Michael Roster
Michael Roster was formerly managing partner of Morrison & Foerster’s Los Angeles office, co-chair of the firm’s Financial Services Practice Group worldwide, and a member of the firm’s policy committee. In 1993, Mike was appointed general counsel of Stanford University, Stanford Medical Center, and Stanford Management Company. He was subsequently executive vice president and general counsel of Golden West Financial Corporation. Mike has also served as chair of the Association of Corporate Counsel, as outside director and vice chair of Silicon Valley Bank, chair of the Stanford Alumni Association, steering committee co-chair of ACC’s Value Challenge, and chair of two start-up companies. He currently teaches Contract Drafting and Analysis at the University of Southern California Gould School of Law and is a director of MDRC in New York, a nonprofit organization that evaluates the effectiveness of government and other programs affecting lower- and moderate-income families and individuals.
Julious P. Smith
Julious P. Smith, chairman emeritus and past CEO, Williams Mullen

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