Not many disputes over pay equity in large law firms are taken public through high-profile litigation. And when they are, they often settle for undisclosed terms, as was the case Friday when Greenberg Traurig and former shareholder Francine Griesing stipulated the withdrawal of her $200 million gender discrimination putative class action against the firm.
But that doesn’t mean the issue of disparate compensation between male and female shareholders isn’t prevalent throughout the country’s largest law firms, experts and survey data say.
In her lawsuit, Griesing v. Greenberg Traurig, filed in New York federal district court in December, Griesing alleged she was told to look for other employment after complaining about Greenberg Traurig’s compensation policies, which she said created a "boys’ club of origination" that stifled women’s ability to generate business and bill as many hours as men.
Greenberg Traurig adamantly denied the claims and the two sides said Tuesday only that the matter "concluded amicably."
Fine, Kaplan and Black’s Roberta Liebenberg is the current chairwoman of the American Bar Association’s recently constituted Gender Equity Task Force. As part of the task force’s work, it has created tool kits for state and local bar associations on the business case for gender pay equity. The task force is set to publish later this year a manual for law firms called "Closing the Gap" that will outline ways firms can close the pay gap. It will also publish a similar manual for women general counsel.
Liebenberg said the statistics from surveys done by organizations like the National Association of Women Lawyers, the Minority Corporate Counsel Association and the Project for Attorney Retention all back anecdotal evidence that women partners often make less than their male counterparts.
NAWL’s annual survey has consistently shown women make less than men in similar positions within a law firm, Liebenberg noted. And in the 200 largest law firms, about 50 percent have no women among their top 10 rainmakers, she said.
"There’s a strong correlation between the fact that women are not achieving pay equity commensurate with their male equity partners because that also translates to whether they are getting positions" of real power in a firm, Liebenberg said, noting attorneys on executive committees and running law firms are often the highest compensated.
A joint study in 2010 by the ABA Commission on Women in the Profession, the MCCA and PAR went beyond the fact that women were often paid less and showed women often felt they were bullied for fighting for origination credit.
According to responses from the more than 700 female law firm partners who participated in the "Survey of Women Partners on Law Firm Compensation," 55 percent said they were occasionally or frequently denied their fair share of origination credit. And 92 percent said revenue generation was the key factor in attaining equity partnership.
Nearly 30 percent of the respondents in that survey said they were subjected to intimidation, threats or bullying to back down from origination point disagreements with their male partners. And 39 percent reported being dissatisfied with how such disputes are resolved at their firms, according to the survey results.
Liebenberg said these surveys touch on the implicit biases that exist within some large firm cultures that lead to pay disparity between male and female shareholders.
"I think that this is a real issue for law firms to be focusing on because the issue of pay and equity compensation definitely affects attrition," Liebenberg said.
If there are no senior women in law firm leadership, there are no women role models and mentors to show younger women they can succeed in law firms, Liebenberg said.
"The advancement of women lawyers into equity partnerships and leadership positions within private law firms is of primary concern to NAWL, and is an issue that NAWL has studied for nearly a decade," NAWL President Beth Kaufman said in a statement to The Legal. "While NAWL does not take a position on private litigation, or on settlements of private litigation, NAWL applauds and encourages all efforts to advance women lawyers into those positions within the profession in which they should be represented."
According to Griesing’s complaint, Greenberg Traurig has a closed compensation system in which only CEO Richard Rosenbaum makes all promotion and compensation decisions with advisement from four other male shareholders who serve as the compensation committee.
Greenberg Traurig has three shareholder levels, consisting of the 300 level, 500 level and 1,000 level. The 1,000 level is the most highly compensated, and less than 10 percent of that level are female attorneys, according to the complaint. The 1,000-level shareholders get nearly exclusive access to the firm’s retreats where they can network and refer business, Griesing alleged in the complaint. According to the complaint, the 1,000-level shareholders are estimated to earn $1 million more per year than other shareholders.
Most new shareholders are placed in the 300 or 500 levels and are required to remain in the 500 level for a certain period of time before becoming eligible for the 1,000 level, according to the complaint. Griesing was hired at the 300 level, where all but one of the female Philadelphia shareholders were placed. According to the complaint, men with similar or less qualifications were placed in the 500 level.
"By assigning women to lower levels and delaying their promotion, the firm denies its female shareholders compensation and opportunities to which they are otherwise entitled," Griesing alleged in the complaint.
She alleged the compensation system lacks sufficient standards, quality controls, implementation metrics, transparency and oversight.
Griesing said she brought in more than $4 million in timekeeper revenues and origination during her time at the firm. She was told that if she generated $600,000 in originations a year, she would receive a $108,000 bonus and that the bonus would increase as the origination increased, according to the complaint. Despite bringing in double the origination, her bonus was only $115,000 in 2008, Griesing alleged in the complaint.
After exhausting other avenues up the food chain in the firm, Griesing said in the complaint that she was left with no other option but to go to Rosenbaum. According to the complaint, Rosenbaum allegedly told Griesing he would not investigate her claims unless she agreed to be "’happy’" at the firm. Griesing then filed a complaint with the Equal Employment Opportunity Commission.
At a subsequent meeting in June 2009, Rosenbaum allegedly told Griesing she needed to leave the firm if she was going to persist in questioning her compensation, according to the complaint.
After the meeting, the firm stopped assigning Griesing work and urged her principal associate to work for another shareholder, according to the complaint. In her December 2009 annual review with Rosenbaum, Griesing said Rosenbaum "chastised" her for filing an EEOC complaint. Rosenbaum allegedly said he was finding it "’difficult to treat [Griesing] fairly,’" in light of those claims, according to the complaint.
On July 28, the EEOC’s Philadelphia District Office determined Griesing had been paid $50,000 less than her nearest male counterpart; that women shareholders were on average compensated less than men at the firm; and men were more likely than women to be hired above level 300. In a subsequent portion of the EEOC finding, District Director Spencer H. Lewis Jr. said he determined there was reasonable cause to believe Greenberg Traurig violated Title VII and the Equal Pay Act by compensating Griesing and other Philadelphia-based female shareholders less favorably because of their sex.