Wilmer Cutler Pickering Hale and Dorr, known as WilmerHale, has introduced a non-equity partnership tier, marking a significant shift from the traditional all-equity partner structure. The firm’s new tier applies to incoming partners, while its current 253 equity partners remain unaffected by the change.
Non-equity or “income” partners, common in many large U.S. law firms, typically earn less than equity partners and don’t share in the firm’s profits. WilmerHale’s managing partner, Anjan Sahni, praised the move as a strategic advantage, offering more flexibility in talent acquisition and retention while providing an additional career path for lawyers.
With the majority of top-grossing U.S. law firms embracing multi-tier partnerships, WilmerHale’s decision aligns with a broader industry trend. A recent report by legal consultancy Adam Smith, Esq. highlighted that 86% of the top 200 U.S. law firms now operate with at least two partnership tiers.
Bruce MacEwen, president of Adam Smith, emphasized the economic benefits of this structure. Non-equity partners can be billed at higher rates than associates without a profit share, giving firms more financial leverage, especially in challenging economic times.
This shift isn’t without controversy. Duane Morris, another prominent U.S. law firm, is currently embroiled in a federal lawsuit where a San Diego-based non-equity partner alleges the firm unfairly demands tax and expense contributions from non-equity partners while withholding profit shares.
As the legal landscape continues to evolve, WilmerHale’s adoption of a non-equity tier reflects the growing trend among elite law firms to diversify their partnership structures, balancing economic imperatives with talent management strategies.
