Halliwell Landau is set to hand out bonuses to salaried partners who get the fees for their work in on time. The system will be introduced on 1 May, at the beginning of the firm's next financial year.
The bonuses will help Halliwells to minimise its work-in-progress lock-up (the period from time recorded to cash collection). Halliwells managing partner Paul Thomas, however, insisted that the firm does not have a unique problem with partners persuading their clients to pay.
“All law firms are happy to get the lock-up down,” commented Thomas. “We'll be incentivising partners to get the work-in-progress in, rather than using punitive measures if they don't make it. We're going into the next financial year very confident.”
According to Thomas, Halliwells reached the decision not to give bonuses to its equity partners because they already have enough of an incentive to collect their fees.
“We'll be incentivising partners to get the work-in-progress in, rather than using punitive measures if they don't make it”
Paul Thomas, Halliwell Landau
Halliwells' approach to work-in-progress management contrasts with that of other national firms. Addleshaw Booth & Co, for example, has proposed to withhold 10 per cent of partners' monthly drawings from the start of the next financial year if more than 25 per cent of a partner's annual billings are more than 90 days old.
Like Halliwells, Addleshaws wants to incentivise partners to bill clients and get cash in promptly. Addleshaws' work-in-progress lock-up increased by 50 per cent between May 2001 and November 2001.
Meanwhile, Osborne Clarke has cancelled its equity partners' quarterly drawings as a precautionary measure against the economic downturn (The Lawyer, 11 February).
Halliwells' salaried partner bonuses are part of a firm-wide human resources (HR) scheme to “recognise and reward at all levels”, a Halliwells spokesperson said. More incentive schemes are being debated – for staff as well as for fee-earners – following the arrival of new HR director Sandra Woolcott.