Paying the piper

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  • This is a somewhat embarrassing state of affairs for many firms that have chosen to follow this model. Hindsight has certainly shown this decision to prove an absolute nightmare for the equity partners in these firms, who must feel truly awful with their current pay packages. That said, I agree with the closing sentiments of this article: in a sluggish economy it is quite right that partners and staff alike should take the rough with the smooth. The problem here is that equity partners end up taking home less than some staff, which can only be described as a financial clanger on their part! Personally I would be very cross if I were to be rewarded less than my juniors, but perhaps this is a sign that in an economy that is a total mess, one cannot simply assume that with higher stature comes higher compensation. The horror of the situation will likely be felt for some time yet; I'm just glad I'm not a partner in one of these firms as I can imagine the reverberation from an empty wallet can be heard from quite a distance. What a disgraceful, putrid state of affairs!

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  • With all due respect Peter, you are wrong.

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  • The article in yesterday's lawyer referred to the substantial capital calls made by Blake Lapthorn over the past 12-18 months: you must wonder how deep the partners' pockets are and further calls cannot be met whether they will be asked to "step out of the pantry".

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  • Pipe down

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  • In the case of Blake Lapthorn the issue is likely to be a short term blip. If one takes a period of say 5 years there is more than adequate evidence that profits have been good and equity partners have done well. We are in a recession and these results prove the point that the risk of running any business is with the owners. Cash call or no cash call the profits in previous years have served the firm well and I do not believe we will be sitting here in a years time poring over similar results. If we are then there are more deep rooted and systemic problems than we are aware of.

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