Author: TSA Press

As many people within the legal profession already know, numerous law firms offer associates a bonus for work that they bring into a firm.  Indeed, many shops award associates a percentage of any revenue from clients they originate, and this amount is usually 10 to 20 percent of all collections received from an associate’s clients.  However, a number of law firms do not provide associates with any reward if they bring in business, or merely assure attorneys that any business development will affect end-of-year bonus determinations.  Nevertheless, more law firms should offer origination bonuses to associates, since firms can increase their revenue through such initiatives and associates will be more motivated to grow professionally.

I first became aware of origination bonuses when I worked at my second job after graduating from law school.  During the interview process, the partners told me that the firm had an origination bonus program, and this really appealed to me.  In order to increase my income, I made sure to attend as many networking events as possible and cultivate my contacts so that I could originate business at the firm.

It took a while to bring in business, but over time, I originated a handful of clients that eventually accounted for six figures of revenue.  This was a decent amount of money to the small firm I worked at, and the business I originated helped keep people busy at the firm.  In addition, I stayed at that firm longer than most attorneys did, so that I could develop the business that I helped originate.  Furthermore, origination bonuses helped me develop skills and step outside my comfort zone in ways that I had not done earlier in my career. I am not sure if I would have felt confident starting my own firm if I did not have experiences with origination bonuses while working at this shop.

I later worked at a few different firms that did not have origination bonus programs.  Because the firms did not award additional compensation based on the work associates originated, I did not feel as compelled to bring in business.  In fact, none of the associates at those firms really originated business.  As a result, the firm was largely reliant on a handful of clients that were originated years ago by a few senior partners.

At one of my year-end reviews, I brought up the issue of origination bonuses when the partners opened the floor up to suggestions that could improve the firm.  The partners seemed hostile about implementing origination bonuses, and seemed peeved that I would bring up the topic.  The senior partner gave two reasons why the firm did not want to institute origination bonuses.  First, the senior partner said that origination bonuses could increase the firm’s malpractice liability, since matters originated by associates are usually outside of the firm’s wheelhouse.  Second, the senior partner said that origination bonuses could open the firm up to additional conflict-of-interest issues with our major clients.

I never found either of these arguments convincing.  Clients originated by associates would be vetted just like clients originated by partners, and simply instituting an origination bonus program does not mean that the firm needs to take every matter that comes our way.  In fact, if an associate bagged a juicy corporate client, neither of these reasons would likely be implicated.  The senior partner was honing in on a few past issues that had no bearing on origination bonus programs as a whole.

It seems like there are a few major reasons why firms do not institute origination bonuses.  Not to mince words, but the main reason is greed.  Partners sometimes do not want to share more of the firm’s revenues with associates than is absolutely necessary.  Indeed, one time earlier in my career, I was at a firm that did not have an established origination bonus program, and rather told associates any business would be considered during year-end bonus determinations.  One associate originated an extremely lucrative personal injury matter that eventually netted the firm a substantial amount of money.  That associate received absolutely nothing for the origination, and this example shows that some firms are simply unwilling to share extra revenue with associates.

Another major reason why firms do not have origination bonuses is because firms want to be in control of all of the money that is shared in a firm.  By instituting origination bonus programs, firms are less able to control how revenue is distributed, since money is provided to associates according to a calculation instead of the discretion of managers.  However, firms can establish programs that merely entitle associates to ten to twenty percent of the revenue from clients they originate so the lion’s share of revenue is still in the control of the firm.

Some might say that origination bonuses shouldn’t be necessary, and that associates should see business development as part of their job.  Indeed, some may argue that associates are not being team players if they only strive to originate business when there is something directly in it for them.  However, most associates are simply tasked with billing time to generate revenue, and developing business is not within their normal job description.  In addition, people should not denigrate associates for being motivated by making more money, and firms should try to incentivize associates accordingly.  Although firms may have to pay associates additional compensation with origination bonuses, the extra revenue and professional development opportunities are usually well worth the expense.

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Jordan Rothman is the Managing Attorney of The Rothman Law Firm, a New Jersey and New York litigation boutique. He is also the founder of Student Debt Diaries, a website discussing how he paid off his student loans. You can reach Jordan through email at jrothman@rothmanlawyer.com.

* The House Ways and Means Committee has filed for summary judgment in its lawsuit against the Treasury Department and IRS over their refusal to turn over President Trump’s tax returns and has also asked the judge to consider the case on an expedited basis. [The Hill]

* Jones Day blasted plaintiffs in the new parental leave bias claims against the firm on social media, alleging that while one ignored “both the law and biology” to file suit, the other’s performance was “below expectations.” [American Lawyer]

* New York adopted the Uniform Bar Exam to make it a little easier for law school graduates to pass the test. Well, uh… that didn’t exactly work out as planned because the UBE had little to no impact on test performance. [New York Law Journal]

* This just in from the Seventh Circuit: In case you were wondering, there’s no such thing as a First Amendment right to lie on your bar applications. [Big Law Business]

* In case you missed it, lawyers for Adnan Syed, subject of the “Serial” podcast, have applied for certiorari before the Supreme Court, asking that the justices reverse a Maryland Court of Appeals ruling where he was refused a new trial. [CNN]

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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

The warning puts the IMF at odds with Finance Minister Mthuli Ncube, who said in an interview he’s in favor of boosting wages in both the public and private sectors to restore living standards and create consumer demand. Ncube is looking for ways to revive an economy that’s forecast to contract this year for the first time in a decade.

In the six years to 2016, Zimbabwe boosted pay for its about 400,000 civil servants to a level that makes up more than 90% of tax revenue, compared with 40% in 2010, said Patrick Imam, the IMF’s resident representative.

“The government wage bill is now on a sustainable footing,” he said in response to questions. “Looking ahead, it is crucial that public wage growth be aligned with economic growth and government revenue.”

In February, the government said a quasi-currency known as bond notes, and RTGS$ in their electronic form, would no longer trade at parity with the U.S. dollar and in June it reintroduced the Zimbabwe dollar, which it had abolished in 2009 after a bout of hyperinflation. It also banned the use of the American currency. The exchange rate is now about 10 to the U.S. dollar and the price of goods bought by middle class workers, such as civil servants, has risen in tandem as these are mostly imported. Officially annual inflation is at 176%, but some analysts estimate it’s as high as 570%.

The resulting economic hardship has spawned calls by the opposition for protests against plunging living standards.

Police violently dispersed demonstrators in the capital, Harare, on Friday, while a second planned rally in the second-biggest city of Bulawayo on Monday was banned by the government. More protests are planned in other cities this week. In Harare 128 people were arrested during the demonstration, according to human rights lawyers.

Having fired 3,000 workers from the public service, there’s limited room for the state to cut jobs further. Both the IMF and the government say that more health workers and teachers will be needed in coming years.

Austerity Measures

Ncube’s government has implemented harsh austerity measures, including regular hikes to fuel prices, in a bid to comply with an IMF Staff-Monitored Program seen as a precursor to getting debt relief that’s needed to restore the economy. It will also need to implement a series of political reforms to convince creditors to participate in any debt restructuring.

The IMF program is due to end in March, with a first review scheduled for next month.

“The Staff-Monitored Program is also intended to assist in resolving the long-standing arrears to external creditors and facilitate re-engagement with the international community,” Imam said. “Given the recent history of Zimbabwe, in particular the fact that the country has arrears to other international organizations, as well as bilateral arrears, the fund is not yet in a position to financially support the country.”

Zimbabwe’s economy collapsed after a wave of seizures of white-owned commercial farms that began in 2000 slashed export income. In November 2017, Robert Mugabe, who had led the country since 1980, was ousted as president in a coup and replaced by Emmerson Mnangagwa. Ncube was appointed about a year ago and tasked with putting the economy back on a sound footing.

Phelekezela Mphoko was co-vice-president with Emmerson Mnangagwa under Robert Mugabe

Mr Mphoko was due at a police station to make a statement on allegations being levelled against him but drove away when his car was approached by the officials, AFP news agency reports.

His lawyer said Mr Mphoko feared being detained and poisoned.

He also denied he was on the run, calling the phrase “sensationalist”.

Mr Mphoko was a co-vice-president under Robert Mugabe.

He served alongside current President Emmerson Mnangagwa when Mr Mugabe was ousted by the military in November 2017, but the two have fallen out.

‘Poison fears’

Mr Mphoko was part of a faction that wanted Mr Mugabe’s wife, Grace, to succeed him rather than Mr Mnangagwa, South Africa’s Mail and Guardian newspaper reports.

The Zimbabwe Anti-Corruption Commission (ZACC) wants to talk to him about alleged abuse of office.

Mr Mphoko’s lawyer, Zibusiso Ncube, told AFP that his client was willing to answer questions, but left when he heard the police “had instructions to detain him”.

Mr Ncube told the BBC’s Shingai Nyoka that his client feared for his life and was concerned that he would be “injected with a poison”.

‘Not a fugitive’

The former vice-president is prepared to stand trial and denies claims he abused his office after allegedly storming a police station demanding the release of an official, Mr Ncube said.

Mr Mphoko “is not a fugitive, and he hasn’t been charged with anything”, he added.

“He would never run away. The allegations are sensationalist.”

Earlier this month, the president fired Tourism Minister Prisca Mupfumira “for conduct inappropriate for a minister of government” after her arrest over the disappearance of millions of dollars from the country’s pension fund.

ZACC alleges the money went missing during her time as minister of labour and social welfare. Ms Mupfumira denies the allegations.

Post published in: Featured

HARARE – Zimbabwe police deployed in force in the city of Gweru on Tuesday, witnesses said, as authorities sought to keep a lid on dissent after banning the third anti-government protest that the main opposition party has sought to organise inside five days.

The Movement for Democratic Change (MDC) planned rolling mass demonstrations in different cities starting last Friday. It accuses President Emmerson Mnangagwa’s government of mishandling the economy, which is facing its worst crisis in a decade, and repression.

The MDC said it would challenge the ban in court on Tuesday. The party failed to overturn two previous bans on marches in Harare and Bulawayo.

In Gweru, a central city, police patrolled on foot and in lorries and also cordoned off a university, a local journalist told Reuters.

“There is a determined effort by the regime to ensure that there is no more democratic space,” MDC national spokesman Daniel Molokele said.

“They are also deploying a lot of military and police in the streets… It clearly shows that the new government is even worse than that of Robert Mugabe.”

The demonstrations are viewed as a test of Mnangagwa’s willingness to tolerate dissent in a country tainted by a long history of repression under his predecessor Mugabe.

But authorities are jittery following violent fuel protests in January that triggered an army crackdown that killed more than a dozen people.

The MDC is perturbed by the statement on Zimbabwe in the 36-paragraph SADC Communique issued Sunday following the regional body’s 39th summit of Heads of State and Government that ran from 17 to 18 August 2019 in Dar es Salaam, Tanzania. The SADC Communique is gravely concerning not just about what it said but also about what it did not say about Zimbabwe.

On paragraph 14 of their Communique, SADC leaders report that “Summit noted the adverse impact on the economy of Zimbabwe and expressed solidarity with Zimbabwe and called for the immediate lifting of the sanctions to facilitate socio-economic recovery in the country”.

Other than paragraph 6 of the Communique that congratulates “Emmerson Dambudzo Mnangagwa, the President of the Republic of Zimbabwe as Chairperson of the Organ on Politics, Defence and Security Cooperation”, nothing else is said about Zimbabwe.

It is disconcerting that SADC could congratulate Mr Mnangagwa as the new head of the regional body’s organ on Defence and security at a time when Zimbabweans are suffering insecurity and defenselessness from the regime in power in Harare.

While SADC leaders are well within their rights to pronounce themselves on the sanctions issue, it is disappointing that they have a frozen and opportunistic narrative on the matter. There’s no difference between what they have been saying since 2001 and what they said yesterday, like a record stuck in a groove.

For SADC leaders, it is enough to make the news headlines by “expressing solidarity with Zimbabwe” and “calling for the immediate lifting of the sanctions to facilitate socio-economic recovery in the country”.  This 18-year old stock-narrative no longer has an audience besides the SADC leaders themselves.

On sanctions, SADC leaders must speak through actions, not through convenient but hollow words for the media. Contextualizing sanctions over a year ago, on January 2018, Mnangagwa himself said, “Yes, sanctions are there, but we should not continue talking about them. We must have solutions and already we have solutions in agriculture, and this should cascade to all sectors”.

Given Mnangagwa’s position, SADC’s call “for the immediate lifting of the sanctions to facilitate socio-economic recovery in the country” is odd and out of step with the reality in Zimbabwe.

Zimbabweans have come to know that when SADC leaders want to ignore or distort the tricky crisis of illegitimacy in Zimbabwe, they wax lyrical about sanctions and express “solidarity with Zimbabwe”, while saying and doing nothing about the worsening plight of Zimbabweans.

Yet there can be no Zimbabwe without Zimbabweans.

Before its 38th summit in August 2018, SADC was confronted by military and police atrocities committed in Harare on 1 August 2018, in which six Zimbabweans were killed in cold blood and 35 others were critically injured by the Army and the Police. This was confirmed by the Kgalema

Motlanthe Commission, an international body whose appointment SADC supported.

It is incredulous that the 2019 SADC summit was dead silent about the findings of the Motlanthe Commission and the failure and the unwillingness, by Mnangagwa’s administration to hold to account the army and police officers who killed six and injured 35 Zimbabweans on 1 August 2018.

Even worse, between 14 to 28 January 2019, at least 17 Zimbabweans were killed, hundreds tortured, some raped, by elements in the army, police, CIO and Zanu PF militia with thousands were displaced internally and externally in an unprecedented orgy of State violence that affected all major cities across Zimbabwe.

As in the case of the atrocities committed on 1 August 2018, in fact worse than in that case, no process of enquiry has been undertaken; and the State culprits are once again getting away scot-free with impunity.

The January 2019 scenario was another major clampdown on citizens and was carried out resulting in 17 extra-judicial killings, 17 cases of rape and other violations of a sexual nature, 26 abductions, 61 displacements, 81 assaults consistent with gunshot attacks, at least 586 assaults, torture, inhuman and degrading treatment (including dog bites), and 954 arrests and detention (including dragnet detentions). Further, a record-breaking 22 MDC and Civil Society leaders including parliamentarians and labor leaders face trumped-up charges of treason and subversion.

On 16 July 2019, labor leaders received anonymous letters with bullets in a clear move meant to intimidate the labor movement against exercising their right to peacefully demonstrate and petition. Where is SADC’s responsibility to protect?  When will SADC, just for once, stand with the people of Zimbabwe and express solidarity not with Zimbabwe but with Zimbabweans?

Yes. Zimbabweans have had enough of a SADC that is always congratulating the President of Zimbabwe and expressing solidarity with the State but never addressing itself to the plight of the ordinary people brutalized by the State.

As SADC leaders were meeting in Dar es Salaam over the weekend, Zimbabwean State agents were busy abducting civil society and political activists; while the police and army were issuing illegal prohibition orders like confetti to deny citizens from holding peaceful demonstrations against the worsening economic hardships induced not by sanctions but by unprecedented corruption through rent-seeking schemes like command agriculture, fuel cartels and abuse of treasury bills by the ruling elite.

On the back of Zimbabwe’s crisis of illegitimacy, these hardships induced by corruption coupled with incompetence are causing multitudes of Zimbabweans to cross the borders into neighbouring SADC countries, notably but not only South Africa, Mozambique, Malawi and Zambia. The consequences of the emigration influx on regional economies are too ghastly to contemplate, yet SADC leaders continue to bury their heads in the sand like ostriches, only to raise the heads when they want to pontificate about 18-year old sanctions while doing nothing about them in real economic terms.

The MDC reiterates that the root cause of Zimbabwe’s problems is political, being a crisis of governance. A legitimacy crisis.

The July 2018 elections further entrenched the legitimacy crisis through a fundamentally flawed electoral process that did not guarantee the will of the people.  The 2018 plebiscite did not conform to the provisions of the SADC Principles and Guidelines Governing Democratic Elections and the African Union (AU) Declaration on the Principles Governing Democratic Elections.

The electoral process was marred by irregularities including a highly partisan and captured Zimbabwe Electoral Commission, lack of transparency in the electoral process including on the printing and storage of ballot papers and poor stakeholder engagement by the Zimbabwe Electoral Commission, a party-state-military complex, partisan conduct of traditional leaders, partisan distribution of food aid, widespread Intimidation, abuse of State resources, biased State media,  an Electoral Law that is not aligned to the Constitution of Zimbabwe including the disfranchisement of diasporans and post-election violence. Such a flawed electoral process perpetuated the legitimacy crisis and is manifesting in the current socio-economic crisis, deteriorating human rights situation and lethargy.

Moreover, there was an outright fudging of the figures as demonstrated by the fact that the Zimbabwe Electoral Commission revised downwards its own figures a record three times in a plebiscite SADC still held as credible.

The MDC urges SADC to urgently take note of the worsening situation in Zimbabwe as a threat to peace and security in the region and to recognize its responsibility to protect. We urge SADC to take the following specific actions:

1. Urgently be seized of the matter of Zimbabwe in order to address the multifaceted crisis and prevent further deterioration of the situation.

2. Urgently find a lasting solution to the Zimbabwean crisis anchored on facilitated and credible national dialogue.

MDC Communications

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