In the supposedly genteel atmosphere of City law firms, small gesticulations can signify life changing events. If Bill, Jill and Phil are senior associates in the corporate department but there is only room for one partner, they will all have been making huge personal sacrifices with the £1m+ profits per equity partner reward in sight. If Bill gets the nod for partnership, the others (certainly Phil and maybe Jill) will be expecting a chat along the lines of ‘we think it is time to take your career in a different direction…’ (ie, to a different place, preferably an in-house role, from where you can send us all the work that you outsource even though we are firing you). If the associate does not get the hint, the tapping comes more frequently, and more like a push towards the door. Eventually, a dismissal will happen. Jill may manage to escape in the short term, perhaps by being offered a professional support lawyer (PSL) role or something on the alternative track to partnership, like an of counsel role.
Many law firms and other professional services firms practise this ‘up or out’ model, some more openly than others – but is it lawful? It certainly does not immediately resemble any of the potentially fair reasons for dismissal recognised by law. It is sometimes dressed up as capability – but truthfully, that does not capture it. There is no issue with the associate’s performance as an associate, they have just lost out to a better candidate in the tournament to make partner. Most law firms can live with the unfairness, though, because compensation for it is capped at around £70,000 and most associates can be persuaded to take less in order to avoid the stress, cost and career-defining humiliation of a battle in tribunal.
