Law Firm Partners: Hard work pays off
Average compensation surpasses $1 million mark

It isn’t easy to get to the top – making partner requires years of hard work and sacrifice. From graduating at the top of your undergraduate class, taking the LSATs, getting into a top law school, interviewing for positions at top firms, to the late nights working as an associate, making partner isn’t an easy road. But the rewards for partners have never been greater.

U.S. law firm partners now average $1.12 million in annual compensation according to Law360’s Partner Compensation Survey. This number represents some of the highest amount and percentage increases on record.

“According to our clients at the firms we serve, we’re seeing between 15% and sometimes up to a 20% increase in partner compensation,” says Chris Kristian of The Westport Group. “And these increases aren’t just in New York and LA — we’re seeing this trend across the country.”

The firm with the highest compensation reported in the U.S. is Wachtell, Lipton, Rosen & Katz at over $8 million per partner according to Law.com.

In terms of areas of practice with the highest compensation increases, corporate partners experienced a 26% increase with annual compensation of $1.49 million on average. Litigation partners experienced a 17% increase, earning an average of $1.05 million per partner according to a report by Major, Lindsay and Africa.

“As compensation increases, the gap between what is covered by traditional disability insurance and what isn’t covered widens,” Kristian said. “And the need for High-limit Long-Term Disability coverage grows with it,” according to Kristian.

“Until we brought High-limit LTD to the market, there was no product out there capable of fully addressing the constantly expanding gap between Group Long-term Disability coverage and income. Now, we are able to help shift the financial risk that comes with a partner’s disability off that partner and the rest of the partnership, by ensuring they are sufficiently protected,” said Kristian.

The Westport Group was founded to solve the coverage gaps in disability income insurance for groups of high earners. The coverage has been widely adopted by many of the top U.S. law firms.

It’s a market that Kristian has seen grow over the last decade, and upward trend at an accelerated rate in recent years. With increased awareness, TWG has seen a large increase in the number of firms considering High-Limit LTD coverage.

“Firms are realizing there’s a need and that High-limit LTD can help them address their gap in coverage. We are now protecting more income for law firm partners than ever before,” according to Kristian. “And the partners see the High-limit LTD coverage as another way that they can attract and retain top talent.”

So, will the trend continue in 2023? Will partners continue to see large increases in compensation? Or will rumblings of a recession lead to a tightening of budgets across the industry?

“It looks like revenue is slowing for some of the larger firms, which means income protection for the partners as well as the partnerships will become more critical,” said Kristian.