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For a variety of reasons, law firms are changing their thinking about retirement policies.

Increasingly, partners are staying on after they turn 65, 70, and even older.

In part, the change reflects the baby boomer dominance in the profession. The American Bar Association estimates that 400,000 of the nation’s 1.1 million lawyers are boomers (those born from 1946 to 1964).

True to their nature, the men and women in that age group reject traditional thinking.

Some of them, however, are encountering problems with established law firm policies that specify an age by which they must retire.

The New York State Bar Association last year appointed a Special Committee on Age Discrimination in the Profession to examine mandatory retirement policies at law firms.

The committee concluded that such policies should be eliminated.

Committee chair Mark C. Zauderer, a partner with Flemming Zulack Williamson and Zauderer in New York City, says law firms should require counseling with older lawyers when they reach certain ages.

“It should be a dialogue with the lawyer to ascertain what the lawyer can and wants to contribute to the firm and adjust compensation accordingly,” he says.

Zauderer says a firm and an older partner may find agreement on a changed role for him or her, perhaps a mentoring role, for instance. The committee’s recommendation gained added weight when the American Bar Association adopted it last year.

Law firms can’t ignore age bias laws, as shown in the high profile case in which the Equal Employment Opportunity Commission sued international law firm Sidley Austin on behalf of 32 partners who were demoted or forced to retire (EEOC v. Sidley Austin Brown & Wood).

Sidley Austin contended the 32 partners were not employees, but were actually owners and employers instead. That meant they weren’t protected by the Age Discrimination in Employment Act, according to the firm.

However, the 7th Circuit sided with the EEOC, finding that the banished partners’ did not participate in the management of the firm. The case eventually settled, with Sidley Austin agreeing to pay its former partners $27.5 million.

The Sidley Austin case, coupled with the new ABA position, has prompted some law firms to modify their retirement policies, Zauderer says, although some have resisted change so far.
In time, more and more firms will gradually loosen restrictions against senior partners staying on board past retirement age, he predicts.

“We don’t permit age discrimination [in this country],” he says. “Private law firms have assumed they would be exempt from the age discrimination laws by virtue of the exemption for employers, [and] the assumption that partners are employers.”

Blaine Prescott, a San Francisco-based law firm consultant with Hildebrandt International, says liberalized retirement policies make sense for firms.

“Historically, we’ve seen a lot of people who reach retirement age, and they still want to work,” Prescott says. “A lot of people who are 65 are vibrant, still have big practices and a desire to work. If they’re let go, they walk across the street to join a firm that doesn’t have the requirement [to retire].”

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