Newly merged Morgan Cole is considering axing up to 15 partners in an attempt to increase its profit margins.
In a discussion document prepared by senior management – and seen by The Lawyer – the firm admits it will have to lay off staff if it is to raise profits per partner from an “unacceptable” u115,000 to u124,000 in the coming year.
Morgan Cole, which currently has 104 partners, was formed by the merger of South Wales firm Morgan Bruce with Oxford practice Cole & Cole last November, adding London firm Fishburn Boxer earlier this year.
According to figures given in the partnership review, revenue per partner in 1997/98 was u555,000 compared to u1,044,000 for Pinsent Curtis and u671,000 for Osborne Clarke.
The report, prepared by joint chairmen Guy Clarke and John Moisson, together with chief executive David Main, admits that the firm has made some questionable decisions about partner promotions in the past. The document does not name names, however.
The report states: “If we are to get close to achieving the goals we have set for ourselves, we need to be parting company with a number of partners. The precise number depends upon further discussions which are taking place at main board level but it is likely to be between 10 and 15.”
There are also suggestions that the firm's London office could undergo rationalisation in the future.
Elsewhere in the report is a recommendation to drop the firm's two-tier partnership system from October in favour of performance-related pay.
The matters will be discussed at a partners' meeting on 20 July.
Managing partner Guy Clarke issued a statement to The Lawyer, saying: “A number of internal discussion papers have been produced examining a range of options. They are merely discussion papers and no decision has been taken by the partnership in relation to them.”