Most law firms that are made up of more than one person are set up as a hierarchy with Partners at the top and varying levels of Associate Attorneys below them. Partners are generally the owners of the business and Associates are employees. The Associates are often given the opportunity to work their way up the ladder to become Partners and share in the profits of the firm instead of just receiving wages.
It is important to have a written agreement or contract between the Associates and the Firm that spells out everyone’s duties and obligations as well as the conditions under which they may advance. The following is a draft contract between an Associate and a law firm that can be customized to meet the needs of a law firm hiring an Associate Attorney.
This AGREEMENT made of this 21st day of March, 2011, between the Law Offices of at Smith, herein referred to as the “Firm” and Joe Blow, hereinafter referred to as the “Attorney.”
The Firm is a Sole Proprietorship, operating as a business rendering legal services. If, during the term of this contract, the Firm changes to another form of business organization, this contract will continue to be binding on both the Firm, under it’s new formation, and on the Attorney.
The Attorney is licensed to practice law in the State of Texas.
The Firm and the Attorney desire to have the attorney practice law as an employee of the Firm.
It is agreed by and between the parties as follows:
Section 1. Employment and Duties.
Employment. The Firm employs the Attorney and the Attorney accepts employment as an attorney in accordance with the terms of this Agreement.
Full Time. The Attorney shall devote full working time and attention on the practice of the law for the Firm and the Attorney shall not, without the written consent of the Firm, directly or indirectly rendered services of a professional nature to or for any person or firm except as an employee of the Firm.
Duties and Assignments. The Firm shall determine the duties to be performed by the Attorney and the means and the manner by which those duties shall be performed. The Firm shall determine the assignment of the clients to the Attorney and the Attorney shall perform services for such clients assigned. The Firm determine the rates at which the Attorney’s work shall be billed.
Section 2. Compensation
Salary. For all services rendered by the Attorney under this Agreement, the Firm shall pay the Attorney and annual salary of $58,000, payable weekly or as may otherwise be mutually agreed. The salary may be changed by mutual agreement of the parties at any time.
Bonus. In the addition to the salary specified in 2.1., the Attorney may receive a bonus. The bonus, if any, will be in such amounts as the Firm may determine in its absolute discretion.
Additional Compensation. In addition to the salary and bonus specified in items 2.1 and 2.2, the Attorney will be eligible to receive a percentage of the Firm’s portion of Personal Injury cases. The Attorney will receive 10% of the Firm’s payment from a Personal Injury case, when the Attorney has performed as the primary attorney on that case. Additionally, the Attorney will receive 10% of the Firm’s payment from a Personal Injury case, when the Attorney personally brought the case to the Firm.
Section 3. Partnership. It is the policy of the Firm to employ as attorneys persons who will be given the opportunity to become partners in the Firm. The Firm after a certain number of years will make the determination as to whether the Attorney will be admitted to partnership. The Firm expects to make this determination with respect to this Attorney, no earlier than July 1, 2005, and no later than July 1, 2007.
Section 4. Facilities.
Office. The Firm shall furnish the Attorney with office space, staff assistance, and such other facilities and services as are reasonably necessary to the performance of the Attorney’s duties.
Liability Insurance. The Firm shall maintain professional liability insurance covering the acts and omissions of the Attorney in performance of the Attorney’s professional duties.
Travel. The Attorney may be required to travel on business for the Firm, and shall be reimbursed for all reasonable and necessary expenses incurred, provided, however, that a detailed account of such expense is provided to the Firm.
Professional Societies. The Firm shall pay the Attorney’s dues for memberships in The State Bar of Texas and the American Bar Association.
Education. The Firm shall pay the reasonable amount of expenses incurred by the Attorney to maintain or improve the Attorney’s professional skills. The Attorney agrees to submit to the Firm such documentation as may be necessary to substantiate such expenses
Section 5. Additional Benefits.
Medical Insurance. The Firm agrees to provide medical coverage for the Attorney, the Attorney’s spouse and dependents under a group accident and health insurance policy, the terms and benefits of which shall be determined by the Firm. The Attorney is currently covered under her spouse’s policy and does not require such coverage currently. That Attorney will notify the Firm at such time that she needs this benefit.
Vacation. The Attorney shall be entitled to three weeks vacation time each year however, the Attorney’s vacation will be scheduled at such time as will least interfere with the business of the Firm. The Attorney is further entitled to time off on all holidays normally celebrated in accordance with the Firms stated policy.
Life Insurance. The Firm may provide group life insurance coverage, in amounts which shall be determined by the Firm.
Retirement Plan. The Attorney shall participate in any Firm qualified retirement plan according to the terms of said plan as amended from time to time.
Disability. In the event the Attorney is unable to perform his or her regular duties as a result of personal disability the Firm will pay the Attorney’s salary during such disability for a total of ninety (90) days in any 24 month period.
Section 6. Operations.
Records and Files. All records, documents, and files concerning clients of the Firm shall belong to and remain the property of the Firm. On termination of employment, the Attorney shall not be entitled to keep or reproduce the Firms’ records, documents or files relation to any client unless the client shall specifically request that its files be transmitted to the Attorney.
Fees. All fees and compensation received or realized as a result of the rendition of professional legal services by the Attorney shall belong to and be paid to the Firm. Any fee or honoraria received by the Attorney for professional services or other professional activities performed by the Attorney shall belong to the Firm.
Section 7. Term.
One Year, Automatic Extension. The term of this Agreement shall begin on the date hereof and continue for a period of one year and shall be automatically extended from year to year unless terminated in accordance with this section.
Events of Termination. This Agreement shall be terminated upon the happening of any of the following events:
The death of the Attorney.
The determination of the Firm that the Attorney has become disabled.
Dismissal for cause of the Attorney as hereinafter provided.
Occurrence of the effective date of termination, notice of which has been given in by either party to the other, so long as there are at least sixty (60) days between giving of the notice and the effective date of termination.
The mutual written agreement of the Attorney and the Firm to termination.
Termination on Disability. The Firm may determine that the Attorney has become disabled for purposes of the Agreement in the event that the Attorney shall fail, because of illness or incapacity, to render for ninety (90) days or more in any two-year period, services of the character contemplated by the Agreement, and thereunder shall be deemed to have been terminated as of the end of the calendar month in which such determination was made.
Causes for Dismissal. The Firm may dismiss the Attorney for cause in the event it determines there has been continued neglect by the Attorney if his or her duties, or willful misconduct on the part of the Attorney, including buy not limited to a finding of probable cause by the Bar for investigation a complaint filed with its discipline system or the filing of criminal charges against the Attorney, which would make retention of the Attorney by the Firm prejudicial to the Firm’s best interest.