Don’t Let Exiting Partners Double Dip

Senior businesswoman in officeWhy pay if the firm doesn’t get the clients?

By Marc Rosenberg
The Rosenberg Practice Management Library

Here’s a question that frequently arises in my consulting engagements: What are your thoughts on partners wanting to work for the firm in a non-partner role after they retire, who continue to control “their” clients while receiving deferred compensation and a salary for their work?

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The answer is rooted in the maxim: “No transition … no goodwill.” This means that retired partners should not have the inalienable right to deferred comp without actively and effectively transitioning their clients. If they don’t transition, then the remaining partners, at their sole discretion, should be able to reduce the deferred comp payments.