Kirkland Partners Who Quit Risk Forfeiting Pay Under New Policy

Kirkland & Ellis can withhold deferred pay for partners who quit, under a policy the firm adopted this week.

Kirkland gives partners more than half their pay after the end of the year in which they earn it. For partners who depart to other firms, the new policy gives the firm discretion to withhold that pay, according to a person familiar with the change.

The move is intended to bring the firm in-line with competitors who don’t pay partners after they leave for rivals. Kirkland declined to comment.

The change could increase the cost of pilfering talent from Kirkland, the world’s largest firm by revenue and one of the most profitable. Departing attorneys may want their new employers to replace any canceled pay.

Kirkland last year suffered major defections from its London office, as Paul Weiss hired partners Neel Sachdev, Roger Johnson, Stefan Arnold-Soulby and John Patten. Kirkland this week lost deals partner Matthew Cohn to Latham & Watkins in Boston.

The Financial News in London first reported the pay policy change at Kirkland.

Departures at law firms are already affected by the year-end pay schedule at Kirkland and other major firms. Lateral recruiting is busiest just after firms give partners their final distribution.

While Kirkland partners who leave risk forfeiting pay under the new policy, the firm now requires them to give less notice—60 days instead of 120, according to the person familiar. Kirkland will pay partners’ capital contributions three months after they leave rather than a year later, under the policy.

The change comes after Kirkland extended through January 2025 referral bonuses it began last fall—a sign of growing demand at the firm. Kirkland late last year raised the size of the bonuses to $50,000 from $25,000.

Kirkland brought in $7.2 billion in revenue in 2023 as profits per partner hit nearly $8 million, according to data collected by the American Lawyer.