Mandatory retirement age
In today’s New York Times, on the front page of the Business Section, an article appears about mandatory retirement age policies of major New York law firms. It seems that law firms have yet to learn from the experiences of their corporate clients. Adam Smith calls this policy idiocy.
Years ago, "Mr. California Banker" (Lou Siegel by name) reached mandatory retirement age at a major banking house in Los Angeles, CA. Lou didn’t want to retire just yet. At age 65, he was still vibrant and enjoyed his work activity. He had no hobbies to which he wanted to turn his unfettered attention. He had enough time for him to see his family. And, he truly enjoyed his work which brought him into contact with the business and political leaders of the day. Quite heady stuff.
He did agree, however, to pass all but three of his clients to other loan officers in the bank to ensure that the customers would stay with the bank at such time as Lou would want to retire. That was part of the bargain he made with the bank management in order to stay on. Of course, the bank was terrified that he would leave the bank, join another bank and take much of their business with him. He could have had he chosen to do so.
You may ask how I know this. Our family business was one of the three customers that Lou kept under his wing. And Lou stayed with the bank, each year getting another waiver from the bank’s management, until HE was ready to retire.
“To be a healthy institution, you have to encourage people to hand off business to the younger generation,” said Richard J. Davis, a partner and Weil Gotshal’s general counsel … " the firm in question in the article. Nor is Weil Gotshal alone. In a survey last year of 46 law firms with 100 or more lawyers, about 57 percent of the surveyed law firms reported a mandatory retirement age, ranging from 65 to 72, according to a survey conducted by Altman Weil. And the issue of age is arising at an earlier date in these law firms, just at a time when our population is living longer, healther and more active lives than ever before.
The featured lawyer, Mr. Victor, however, had other options. He went with Dewey Ballantine, just a few blocks down the street. He was courted by, among others, Jeffrey L. Kessler, an antitrust lawyer with Dewey Ballantine who had left Weil Gotshal a few years ago.
Seemingly, Dewey had a more rational approach. Dewey has no mandatory retirement age. (The firm has a “presumption” that the retirement age is 65, but management reviews each case, Mr. Kessler said.)
Not only do they understand the continuing ability to be a good lawyer, they also see a very pragmatic, economics aspect to the move by Mr. Victor from Weil Gotshal to Dewey Ballantine: Mr. Kessler said that most of Mr. Victor’s clients appear to be following him in the move.
There must be a way to train younger lawyers, get and keep them involved, reward them financially and create a holistic culture in the law firm without throwing still productive, energetic and otherwise capable lawyers into the street. Corporate America seems to have found a number of solutions. Why can’t law firms?Tags: Management
Categorized in: Management