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Regulation Companies
Bonuses structured as forgivable loans are getting used for companion retention
Some legislation companies are utilizing forgivable loans to retain worthwhile companions and maintain newly promoted companions pleased. (Picture from Shutterstock)
Some legislation companies are utilizing forgivable loans to retain worthwhile companions and maintain newly promoted companions pleased.
New York recruiter Alisa Levin, a principal on the Greene-Levin-Snyder Authorized Search Group, described two sorts of forgivable loans in an interview with Law.com.
Companies attempting to retain a companion might give that particular person a forgivable mortgage that must be returned if the lawyer doesn’t keep for a set time interval, Levin instructed Regulation.com. In no less than one occasion, the article says, a BigLaw agency supplied forgivable loans to retain companions throughout merger talks.
Companies additionally use forgivable loans to handle “the challenges of a transition” when a lawyer used to getting cash regularly turns into a companion, Levin stated.
One advantage of forgivable loans is their “stealth high quality,” the article says. Companies usually don’t report such loans in a companion’s compensation schedule. That retains different companions from in search of a payout.
“When a agency desires to reply to productive companions who’re threatening to depart with out disturbing the present compensation system, a forgivable mortgage, which is usually not disclosed to the entire partnership, is a means of not directly black-boxing compensation,” stated recruiter Matthew Bersani, a founding companion of the Cliff Group, in an interview with Regulation.com.
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