Age case win threatens partnership structure

Lawyers have warned that the US Equal Employment Opportunity Commission’s (EEOC) long-running age discrimination lawsuit against Sidley Austin could signal the end of current partnership structures.

The Chicago-based firm has been battling the claims, which relate to the forced demotion and expulsion of 31 partners in 1999 because of their age, for six years. But the US Court of Appeals ruled earlier this year that the EEOC may seek monetary damages for the partners.

There is growing concern within the US market that, should the EEOC win the case, it would open the door to a slew of similar claims, forcing firms to re-evaluate their partnership structures and their treatment of partners.

Meanwhile, lawyers have warned that UK law firms could face similar claims when the UK Employment Equality (Age) Regulations 2006 come into force from 1 October.

James Davies, joint head of employment at Lewis Silkin, said: “More claims in the US must follow if it becomes clear that partners can rely on the age discrimination laws for protection.”

Cripps Harries Hall partner Roger Byard warned that it would become just as difficult for UK law firms to ease partners out. “After 1 October 2006, a fixed retirement age will be discriminatory and will be unlawful unless the chosen age can be justified.”

US law firms have previously had near immunity from lawsuits based on their treatment of partners. But the EEOC claims that partners not involved in the day-to-day management of the firm should be treated as “employees” and be covered by the US Age Discrimination and Employment Act.