Freshfields is maximising use of its contractual six-month notice period for non-U.S. partners who opt to leave the firm, in a shift away from its usual practice of allowing partners to leave after three months.
Although the firm’s partnership contract allows it to require departing partners to observe a full six-month notice period, normal practice was to accept half that, according to two sources with knowledge of the firm. The firm has recently decided to use the full extent of its contractual power with certain senior partners as it faces a growing number of top level exits across Europe, the people said.
One of the people said that it is the first time the full six months has been implemented.
Lengthy notice periods are generally associated with U.K. and European headquartered law firms and can serve several purposes, including disincentivising departures and minimising their impact. Most of the time, partners are put on garden leave, which requires them to see out their notice away from work.
Some firms have justified longer notice periods as a means to offset the sometimes destabilising effects of exits by smoothing succession planning and enabling the orderly transfer of mandates. Long notice periods can disrupt the departing partner’s client relationships, reducing the likelihood of the firm losing clients and market share.
Last month, Law.com revealed that A&O Shearman was also implementing lengthier and less defined notice periods, with the potential to insist on a nine-month period, against a backdrop of a planned 10% reduction of its equity partner ranks among many other partner departures, which by January had closed in on 200.
Freshfields too has faced departures, with several, many long-time, partners leaving for rivals.
Among them is a four-partner Germany team that last month left for Latham & Watkins, led by the firm's former Continental European head Markus Paul, and his fellow private equity partner Carsten Haak, as well as Munich-based corporate partners Wessel Heukamp and Verena Nosch. Others have included Brussels antitrust partner Rafique Bachour, who before his exit to Skadden, Arps, Slate, Meagher & Flom was one of the firm’s global managing partners, and senior corporate partner in Spain Armando Albarran, who left last month to launch Gibson Dunn & Crutcher’s Madrid office.
Meanwhile, Cyril Valentin, the firm’s former Paris tax head, and veteran corporate partner Hervé Pisani, both left last month for White & Case.
Over a similar period the firm hired Kirkland & Ellis partner Florian Sippel to its Munich office.
In the U.S., where Freshfields is focusing much of its hiring attention, it has hired Nema Milaninia, a regulatory and investigations partner from King & Spalding, and Manish Kumar, a veteran of the Department of Justice. However, this month, the firm saw its head of the U.S. energy and infrastructure group and co-head of the firm’s Latin America practice, Melissa Raciti-Knapp, join Vinson & Elkins in New York.
The notice period development adds to the perception of a growing divergence between Freshfield’s U.S. practice, into which it has invested a great deal, and its historical European hubs. In the U.S., employers are generally prohibited from using long notice periods, with most U.S. law firms utilizing 30 day periods or less.
Freshfields declined to comment.
Feb 23
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