HFW mulls shorter lockstep, mandatory retirement age
Holman Fenwick Willan (HFW) is considering cutting the length of its modified lockstep from seven to five years as, in a separate move, it plans to introduce a mandatory partner retirement age of 62.
Roderick I’Anson Banks
Currently partners at HFW enter the lockstep on 10 points, progressing at 1.5 points for the first two steps, followed by one step of one point, then three steps of two.
The simplified system would see partners still enter the lockstep on 10 points, but then progress up the ladder two points at a time to 20.
The lockstep changes coincide with a simplification of HFW’s partner retirement age. Partners currently retire at a variety of ages, usually between 60 and 65. Indications are that the firm will plump for a single retirement age of 62.
Holman turned to partnership law guru Roderick I’Anson Banks of 48 Bedford Row for a legal opinion on both the retirement age and lockstep changes. Banks confirmed that a reduction in a firm’s lockstep could help head off remuneration-related age discrimination cases.
“Under the ’business need’ test that applies to the provision of benefits, if the period of service that provides the benefit is five years or less, firms wouldn’t need any further justification,” Banks said. He added that justifying a mandatory retirement age would require satisfaction of the more stringent ’legitimate aim’ test.
The move comes ahead of a potentially landmark Supreme Court judgment next January in the case of former Clarkson Wright & Jakes partner Leslie Seldon.
Seldon sued his firm after he was forced to retire at 65. Next January’s Supreme Court decision should determine the policies firms can use to justify retiring partners.
