First-Year Associates Eligible for Partnership

Across the pond, anti-age discrimination regulations are going to go into effect in October, and firms are already bracing for their impact.  This is what they require, in a nutshell:

"The Regulations apply to employment and vocational training. They prohibit unjustified direct and indirect age discrimination, and all harassment and victimisation on grounds of age, of people of any age, young or old."

In other words, not just the old, but also the young, may allege discrimination. And the regulations apply to all private sector activities, regardless of how remote their connection with government or public sources of funding.   Finally, note the somewhat oblique reference to "vocational training," which is elsewhere clarified to make clear that any age-related favoritism in providing professional development must be strictly justified.

So much for blithely assuming that 3rd-year associates need different types of instruction and coaching than do senior partners.

But UK law firms are already taking the matter seriously.  Eversheds pre-emptively dumped its six-tier lockstep in favor of "a scheme based wholly on performance criteria, including fee income generation, profit and strategic value, client service and behaviour."  Said Alan Jenkins, Eversheds' chair, "There's real doubt as to whether lockstep is lawful under that law," since it obviously incorporates age and tenure into remuneration.

Elsewhere, consultants are beavering away advising firms on the implications of the regulations for recruitment, retention, and retirement.  Consider this advice glibly proferred: 

"Do you require a minimum length of service, a minimum age or a minimum number of years post-qualification experience before a [lawyer] can be admitted to partnership? If you do, this is discriminatory to younger [lawyers] under the regulations."

I see.  If you believe this, so much for the Cravath system.

Actually, I find this fellow's claim implausible, although certainly successful at focusing one's attention.  In the event, I have to believe that the literal terms of the regulation would yield to sturdy common sense, and a recognition that in fact a first-year associate is an utterly different animal than a tenth-year.

There's another, even more bizarre, component:  Evidently "those aged 65 and over are completely excluded from complaining about mandatory retirement, or about being discriminated against on grounds of their age."

In other words, the law comes pre-packaged with a default mandatory retirement age of 65. But for those under 65, the regulations promise a free-for-all:  One Ashurst partner logically predicts that "every single application to an employment tribunal will start to have age discrimination as a part of it."  And why not?

Permit us to step back.

First off, far be it from me to wish age discrimination (properly understood) upon any senior:  With luck, we'll all be there some day.  But doesn't this regulation invite the Law of Unintended Consequences right through the front door and into the parlor?   Among other things:

• The Ashurst partner is surely right when she predicts a count of age discrimination will be xeroxed into every employment matter; is this a productive use of professional resources?
• From now until the time the regulation takes effect (in October), it will be a free-fire zone on those marginally productive employees under 65 who are currently unprotected:  Best get rid of them now before they have another arrow in their quiver.
• The "expiration," as it were, of age-discrimination protection at age 65 strikes me as breathtakingly obtuse.  Consider that one of the Truly Serious Problems in the western world in the next 20—50 years is underfunded social security and pension schemes, and the UK is evidently now issuing carte blanche to employers to offload everyone 65 and a day?  Let's just suppose a non-trivial proportion of those seniors wants or needs to keep working to support themselves?   I don't know what your plans are, but I don't intend to retire until I have to be removed bodily.
• As well, we have the delightful stigma that will now attach to youngsters enjoying privileges not granted earlier generations, and to oldsters mildewing in their tenured saddles:  You can hear the muttering already, "If it weren't for that damned law,..."  So much for the presumption of meritocracy.  (If you doubt me, look at the consequences of affirmative action and preferences here; could you create a more toxic imperative for an organization than to put its thumbs, at government insistence, on the scales of talent?)

So is "age discrimination" an entirely imaginary problem that requires nothing more than the magical unfettered hand of the laissez faire market to eradicate it?  Actually, I would very much like to think so.  I would like to think that "recruitment, retention, and retirement" decisions, as our friend the alarmist consultant puts it, are always determined by pure objective merit.  But of course that would be too simple; we are human beings, after all.

Charles Green (co-author with David Maister of "The Trusted Advisor") just sent me his new book, "Trust-Based Selling," and although I've only started it, he makes the psychologically trenchant point that, in making a complex buying decision, people will first "screen" for basic qualifications (a law firm I've heard of, a lawyer who's done this before, reasonably convenient, fees that don't make me gasp, etc.), but after the "screening" comes the critical part:  The selection.

And the selection is almost never (OK, you purchasing executives in the audience excepted) about rational criteria:  It's about trust.

So the moral of this story is that when we make complex hiring, promotion, and alas firing decisions, there are always rational prerequisites involved; but pulling the trigger comes from our gut.  It is therefore impossible to exclude, a priori, the possibility of discrimination.

The good news is that systemic discrimination leads to suboptimal economic performance, and ultimately harsh punishment in the marketplace.   And it does not endure:  Show me a "bulge bracket" New York law firm today whose lawyer ranks are Ivy League-educated WASPs and I will congratulate you on inventing your own way-back machine.  In the meanwhile, let's hope this UK regulation is one Anglo-Saxon legal idea that does not travel well.