DLA Piper has overhauled its partnership constitution following a wholesale review that gives the board power to axe equity partners with 12 months’ notice.
Until now 90 per cent of the 171 equity partners in Europe, the Middle East and Africa needed to be in agreement to eject a partner for performance reasons. A 75 per cent vote was required for issues such as misconduct.
“This was part of a modernisation process to get us in line with the rest of the market,” said European managing director Andrew Darwin. “We’re no longer the firm we once were. We don’t think that we’ll have to use the notice period – we’ve never voted out a partner without cause.”
Darwin said that if partners were de-equitised this would be through agreement rather than via a notice period.
One partner told The Lawyer that the new rules protect partners from having to carry underperforming peers.
The review also brought in other changes, such as increasing the capital contributions expected by fixed-share partners and creating a pro-rata profit share for those partners.