How Lateral Partners Should Negotiate Compensation When Working With a Recruiter
Today’s post covers a very specific scenario. We’ve talked before about filling out Lateral Partner Questionnaires (LPQs) as a non-equity partner and how to present your portable book of business when that information will have direct bearing on the compensation offered to you. The very specific scenario we’re touching on today is a lateral move to a non-equity partner position when a recruiter is involved.
The presence of a recruiter changes certain elements of the negotiation at each stage of the interaction between the law firm and the potential lateral partner.
In the very first steps of the process, a recruiter can serve as a bridge to make sure that the firm and the person being recruited are in the same universe. They can easily identify a floor for the candidate and set expectations for both parties.
At this juncture, candidates should not be too specific. Keep your options open by expressing that all elements of compensation will come into play, including how the firm calculates equity partner compensation and any requirements to buy into the partnership. Too often, lawyers provide a single number to a recruiter to signify their base salary, only to find out later that a more flexible approach would have served them better.
In salary negotiations, it’s easy to accept less than you asked for but very hard to get more than you initially requested. So, as a starting point, quote a range that goes above what you are willing to accept. Accompanying those numbers should be a message that communicates your openness to negotiating. For example, if the lowest base salary you would like to receive is $300k, at the beginning of the process, tell the recruiter something along the following lines: “I am looking for something in the range of $350k, subject to other elements of comp of course.” This response will help the recruiter help you by setting an initial bar, while also signaling flexibility on your part.
The best time to convey this information is prior to filling out the LPQ. This can be instrumental in setting a salary you’re happy with even if the details of your portable book of business don’t justify quite as high of a number.
If the interview process is proceeding well, salary may come up again before the firm provides an offer. At this stage of the process, the recruiter again acts as a conduit, delivering information between parties. The candidate will continue to disclose more as the process continues, and the recruiter can help to frame those details in a way that will assist the firm in determining an appropriate level of compensation. The recruiter can sometimes convey candidates’ sensitivity to reductions in proposed pay better than the candidates can themselves. To some extent, a recruiter can act as an advocate for you.
Toward the end of the process, either after or just before the firm provides an offer, you will reach a point where your interests as a candidate and the interests of the recruiter diverge. As consultants to lawyers, we have seen first-hand that recruiters will generally want to wrap up these deals, while you might have more questions or see an opportunity to leverage your bargaining power.
At this step in the process, it is often most effective for the candidate to speak directly with decision makers at the firm about compensation, marketing resources the firm will provide, what is required to become an equity partner, and other elements of present and future compensation. This is good preparation for negotiating compensation in future years when the recruiter won’t be in the picture. In the case of a regional or national firm, it may be necessary to talk to someone at the firm’s headquarters, not just at the branch office you’ll be working with.
Recruiters play an important and useful part in some lateral moves. And if you do work with a recruiter, it is important to keep them in the loop. Unless something has seriously broken down in your relationship with your recruiter, you should let the recruiter know that you will be talking directly to decision makers at the firm.
But don’t make the all-too-common mistake of relying on the recruiter to get you the best possible compensation package or the answers to your most difficult or sensitive questions.
When you understand how your relationship with a recruiter can progress, you will be in the best position to negotiate the compensation you want and, most importantly, make a career move that serves you, your clients, and your life.