I am a partner in a husband/wife owned law firm in Seattle, Washington. We have four other associate lawyers in the firm. One of these lawyers is our son and the other is the daughter of my wife’s (who is my partner) brother. We have four staff members of which one is also a family member. We are a general practice firm and we have been in operation for ten years. While the firm has done well over the years we have had our challenges. Office problems seen to follow us home and both staff employees and non-family attorneys are alienated. We have been experiencing turnover of both staff and attorneys. What should we being doing different?
I have seen family practices go both ways – successful and not so successful due to the conflict and drama that can exit in family practices if they are not setup and managed properly. A few of the challenges and issues that can arise in family owned law firms include:
- Preserving family harmony
- Competency of family employees
- Determining compensation for family members
- Admission of family members to partnership and other attorneys in the firm
- Planning for succession and leadership
Family practices must first start by recognizing that there are three social systems at play – the family, the law firm business, and overlap of the two. Unless boundaries and rules are established there will be conflict and tension. Family roles and roles in the law firm should be be developed. Here are a few guidelines that family practices should consider adopting:
- Develop family and law firm charters – sort of like job descriptions – that outlines roles and responsibilities in the family and the law firm.
- Establish criteria for who in the family can join the firm.
- Determine education and experience requirements for joining the firm.
- Determine how titles of family members in the law firm will be determined.
- Determine how job performance will be evaluated.
- Determine consequences for inadequate performance.
- Determine how compensation will be determined.
- Leave law firm business at the law firm – don’t bring it home.
John W. Olmstead, MBA, Ph.D, CMC
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