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Rainmaker - or cloud on the horizon?

20 October 08

Risk and risk management issues associated with new colleagues, especially partners appointed through lateral hires

by Olivia Burren, Nick Worthington

A recent survey indicated that more than two-fifths of new partner appointments are lateral hires, rather than the promotion or appointment of existing staff. What implications does this have for risk management?

Someone who is being hired at partner level will be well established in their career, and you might assume that this means they have a good awareness of risk management. Because of the level of seniority at which they are being appointed, it may be implicit that they will hit the ground running and will take on, or bring with them, an existing caseload. They are also likely to have reached a level in their previous employment at which they were supervising, rather than being supervised, and at which they were subject to few checks or reviews. The advantage of hiring at partner level is that they will be able to bring in fees and require less attention than more junior staff – but you could be increasing the risk to your business as well as the opportunities.

Same emphasis?

An experienced fee-earner with several years in practice should be familiar with the rules governing professional conduct, but they may have come from a firm where less emphasis was placed on these, or perhaps where someone else had responsibility for checking these issues.

Take particular care over any files that the new partner brings with them. Do the money laundering checks meet your firm’s criteria; will there be any conflict with existing clients; and is this work that your firm would ordinarily want to take on? Ensure that any key dates are entered into your firm’s diary system, and that the file is marked for review. Be wary of such matters – have they been brought across because they are good business and there is a good relationship with the client, or are they “mental block” files that the fee-earner was embarrassed to leave behind?

Coaching in the system

Is it wise to assume that your new colleague is competent in dealing with IT and emails? Undertaking some form of assessment will help to avoid embarrassment… or worse. Your induction process should ensure familiarity with the telephone system, diary software and your client and knowledge management databases, particularly if they will not have their own secretary.

Nobody is exempt from risk, and nobody should be exempt from review and supervision. Depending on the level of experience of the new partner and the type of work being done, it may be appropriate to have their outgoing post or emails read by someone else, at least for a preliminary period. Incoming post should always be read, and files should be reviewed regularly.

Don’t assume that your new colleague is experienced (or naturally skilled) in delegating, supervising and monitoring other staff – often this sort of responsibility is thrust on new partners without any training. Even if already at partner level in their previous practice, they may not have developed or learned these skills. Find out what training they have received, what they would like to receive, and what you think they need – a formal appraisal at an early stage is best, even if your firm has its own appraisal system at set times. All partners, new and old, should be included in peer-to-peer file reviews.

No matter how dynamic, talented and confident your new colleague is, the thought of joining a new practice can be daunting. They may have trained and qualified in their former firm, and never worked anywhere else. New colleagues may be resentful that an outsider has been brought in, or feel that they have been overlooked for promotion; it’s human nature to be fearful of change.

Mentor and monitor

Consider appointing a mentor for the new partner to assist and support them during the first months of the job; this is an informal relationship, and should be someone other than the partner responsible for supervising their work. They will be able to assist with queries which may seem trivial, and to give guidance on areas which may not be covered in the office manual. They will also be able to monitor whether this person is coping with the workload, and settling into the firm, or whether they may need extra help, training or guidance in any areas of the new role.

Remember that partners are just as likely to suffer from stress, depression or exhaustion as any other member of staff, but may find it much harder to admit this or to ask for help, especially if they have recently joined the organisation.

Nurture and care for your new colleague, and they will reward you. Assuming that they must already know the ropes and abandoning them to an empty office will not give you, or them, the best outcome.

Olivia Burren is a solicitor and risk management consultant in the Professional Risks team at Master Policy co-insurer, Travelersr


New staff, new risks

Every new member of staff at whatever level should be given a full, structured induction procedure, Nick Worthington advises

“We have a three part induction procedure – show ’em the kitchen, show ’em the toilets, show ’em their desk”

We all recognise the scenario. The firm is overloaded with work and needs extra fee earners. Then a new recruit arrives, the workload is spread and everyone breathes a sigh of relief.

Problem solved? Probably not.

The arrival of new staff is a real risk to your business, yet staff induction is often relegated to the bottom of the task list. If so, there is a real danger that all you have done is to defer your problems for a month or two. They will be back to bite you – hard.

Rather than putting their reputation and profits in jeopardy, law firms should implement effective staff induction procedures. Practices are now confronted with a wide range of legislation and regulations that require strict compliance. The new employee must be immediately assimilated into the regime. Has the employee been trained on money laundering? What is their knowledge of health and safety issues? Do they have urgent training requirements?

Preparations should commence before their arrival. Firms should draft a written job description for the new employee, setting out their job purpose and key tasks.

Do not forget communications with existing staff. You should circulate an email or memo around the firm informing all staff of the new appointment, their intended role and starting date.

After arrival, the new employee should be briefed on the firm’s procedures and policies without delay. This will not be achieved by gradual exposure to the firm’s working practices; there is no substitute for a formal induction procedure. This will be a programme which the new employee will undertake, containing standard items on a checklist. Any areas for immediate action/training should be noted and monitored.

Office manual – general

A representative of the firm (e.g. the office manager) should sit down and take the employee through the office manual. They should also be given a copy of the manual to take away and read. Key areas that should be discussed are: email policy (including internet usage and intranet) disciplinary and grievance procedures money laundering procedures

client complaint procedures appraisal systems accounts procedures levels of authority – signing letters/undertakings, requesting cheques, handling cash, expenses etc


IT systems holiday and sickness policies telephone and voicemail procedures organigram – a diagram explaining the structure of the firm and where everybody fits in.



The employee should gain an understanding of the firm’s risk management and practice management procedures. This is the starting point for their assimilation into the firm’s culture.

Office manual – department

A representative of the department (e.g. department head) should take the employee through the department’s procedures. Key areas that should be discussed are: their role, where they fit, objectives, targets, business plans etc diary systems – explain precisely what to enter, where and why file management file verification precedents

insurance – explain the circumstances for notification of potential claims and the procedure.


Reduce the exposure to risk by identifying the risk areas they are exposed to and explaining the risk systems they should apply to reduce that exposure.

Confidence boost During their initial period with the firm you should conduct regular discussions with the new employee. Do they have any concerns? What don’t they understand? What training is needed?

The induction procedure should apply to all categories of employee, from the lateral hire equity partner to the new office junior. Remember that the actions of all staff can lead to claims and complaints, not just the actions of fee earners. Do not forget to include temporary staff or staff who are returning from extended periods of leave, for example maternity leave, sabbaticals, long term illness. Do they need updating? Have procedures changed?

This managed introduction will give the recruit confidence in their new employer. First impressions are important and the retention of good staff is vital for the future health of the business. A good induction process will help the new employee to feel part of the team. It will emphasise that the firm has good management procedures.

New staff, new ideas and new skills are essential ingredients in a growing business. Make the most of them, but do not forget to manage the risks as well.

Nick Worthington is a solicitor and risk management consultant in the Professional Risks team at Master Policy co-insurer, Travelers

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