Women Fight Back Against The Lawyer Pay Divide

The statistics keep coming. Across U.S. law firms, female equity partners make 80 percent of their male counterparts' pay. Last year, while the men were taking home $629,407, the women were averaging $504,000.

Despite graduating from law school in equal numbers as men for more than 15 years, women continue to be underrepresented in the industry's top echelons, accounting for just 18 percent of equity partners and 22 percent of attorneys serving on top governance committees, according to the National Association of Women Lawyers' 2015 report.

Earlier this month, legal consultancy Major, Lindsey & Africa added yet another statistic to the mix: While pay is going up for both male and female law firm partners, the men on average make 44 percent more than the women. Factors like origination and billing rates are contributing to the divide.

Determining what individual partners should receive in compensation often involves complex decisions as well as a series of factors that are weighed differently depending on the firm, according to Jon Lindsey, New York founding partner of Major, Lindsey & Africa. When firms don't operate under a lockstep structure, compensation decisions at many firms tend to be based in large part on originations, which center on the revenue attorneys are bringing into the firm, and working attorney receipts, which focus on how much work is being generated based on attorneys' billable rate multiplied by their billable hours and their realization rate.

While Major, Lindsey & Africa's survey found that male partners made 44 percent more than female partners, the survey also showed that male partners had, on average, higher billable hours, billing rates, working attorney receipts and — perhaps most significantly — 50 percent higher originations than female partners, and those higher numbers would likely translate to bigger compensation.

"While there are undoubtedly individual cases of inequity, it is too simplistic to say firm compensation systems are unfair solely because male partners are, on average, earning more," Lindsey said. "If you look at the key factors that most firms used to determine partner compensation, particularly originations, the gap is not wildly out of line."

Firms are making efforts to be more conscious of how they make compensation decisions by diversifying their compensation committees to better reflect their partnerships as a whole, and some are even penalizing attorneys who are perceived as hogging credit for landing new business or clients, Lindsey said.

Read more of this feature at Law360.


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