Things to Keep in Mind When an Employee Leaves the Firm

Attorneys come and go. Sometimes partners break up. And frequently, we see young associates who have earned their stripes go on to start their own practices or join other firms. What are the obligations of the firm and the departing lawyer when it is time to say goodbye?

Look First to the Agreements

Onboarding paperwork takes on huge significance when a lawyer decides to depart from your firm. When the lawyer joined the firm, some agreement should have been put in place. Whether there is a partnership agreement, employment contract, or at-will employee handbook, there should be some document or set of documents governing the relationship of the lawyer to the firm. Start here when determining both the departing lawyer and your firm’s obligations.

Keep in mind that the agreement between the lawyer and the firm cannot contradict either party’s ethical obligations, but it may well create obligations beyond those imposed by the ethical rules, and it may also dictate who takes on certain ethical obligations discussed below.

Ethics: Communication Is Key

When looking at the ethical implications of departing a firm, keep in mind that communication is critical.

Model Rule 1.4 requires a lawyer keep a client reasonably informed about their matter, which would certainly require the departing lawyer to inform the client of the departure. The best practice for communicating this to the client is a joint letter from the lawyer and the current law firm. If that is not possible, separate letters are permissible, but they should be very neutral about the client’s choice of how to continue; neither the firm nor the departing lawyer may disparage the other to the client.

The client must be informed they have the ultimate choice of who will represent them. The communication informing them of the lawyer’s departure must also make clear they can choose to stay with the firm, go with the lawyer, or make another choice altogether.

Many states have looked at this issue of communicating with clients in this context, and there is a consensus that the departing lawyer has the obligation to communicate with clients with whom they have a direct relationship, including current clients for whom they are currently handling matters.1

In contrast, the lawyer does not have the obligation—or, likely, the right—to make any announcement to those clients of the firm who are not clients they serve. Communication to non-clients would be solicitation of a prospective client, an issue governed by Model Rule 7.3 and the attorney advertising rules in general. If a departing lawyer contacts clients of the firm served by other lawyers, that may well get the lawyer in trouble for interfering with the existing attorney-client relationship.

Handling the Tangibles

As with any breakup, there is the question of the division of possessions. In lawyer/law firm splits, the primary possessions are the client files and any other useful materials to which the departing lawyer has access.

Again, the first place to look is the agreement between the lawyer and the law firm. Often, possession of items such as CLE presentations created for the firm, firm forms, sample briefs, and research materials are discussed in onboarding documents.

Possession of client files will largely depend on a client’s choice of lawyer to represent them post-breakup. If the departing lawyer is leaving a client with the firm, they should leave the file at the firm as well. If the departing lawyer is taking a client with them, then their file can go with them too.

This raises the question of copies of client files. May the lawyer or law firm who does not keep the client nevertheless keep a copy of the client’s file?

If any file were to be kept by the lawyer not continuing to represent the client, that copy must be made at the lawyer’s expense. Under no circumstances may the client be charged for a copy. However, whether a copy may be made at all is less definitively answered.

Some malpractice carriers will insist that an insured lawyer retain a copy of a client file (or certain portions of it) for a period of time. Absent this requirement, some lawyers want to keep a copy of the file to ensure the ability to respond to a future disciplinary complaint or to comply with rules about file retention. No matter the reason, if a copy is made, it is important to take into consideration what is in the file. For example, if the file contains attorney work product, a copy can probably be kept by the lawyer who created it.2 However, if the file contains confidential client information, retention may be governed by a protective order or confidentiality agreement. Each case will need to be addressed separately and carefully. If a file copy is kept, all guidelines governing the handling of confidential client information remain applicable even if the person keeping the file is no longer representing the client.

Conflict Prevention

The departing lawyer who goes solo will have no significant conflict concerns when taking clients with them, but the lawyer who joins an existing practice may. If a lawyer intends to take clients from the firm but is joining another, they will need to do a thorough conflicts check with the new firm before bringing any clients aboard. If any conflicts exist, appropriate action will need to be taken, which may include declining to bring the client at all, obtaining necessary waivers, or the construction of an ethical wall between the incoming lawyer and client and the existing firm.

Crossing Ts and Dotting Is

In the chaos that can occur when a lawyer leaves, it is easy to forget administrative details. Yet failing to do some of these can get you in disciplinary trouble. Do not forget to:

  • Update the firm’s website to remove the departing lawyer (to prevent the firm from being liable for actions taken by the lawyer after departure).
  • Update the departing lawyer’s state bar records and membership records in any court to which the lawyer is admitted (to prevent disciplinary violations for failure to maintain current records).
  • File change of counsel or change of firm association notices in all open court matters in which the lawyer appeared. The obligation to do so falls on the lawyer continuing the representation, though the lawyer or law firm being removed should ensure their name is removed if the other fails to timely file the notice. If there are non-court matters, make sure all counsel and parties are notified.
  • Update trust account records and permissions. If the lawyer was a signer on the firm’s trust account, remove them immediately.
  • Update the firm’s malpractice insurance to prevent the firm from having any policy liability for the lawyer’s actions after departure.
  • Both the firm and the lawyer need to update all social media and advertising outlets. The lawyer should change their firm association on all accounts and the law firm should remove the lawyer from all advertising and remove all permissions to post on social media accounts.
  • Inform all staff members who may be in contact with clients (such as receptionists, answering services, or any other front-line employees) what to tell clients who are looking for the departing lawyer. This must be professional and in line with the firm’s obligation to keep the client informed and not prejudice the client’s cause.

Maintain Civility

All of these swirling and sometimes overwhelming responsibilities will be much easier for everyone to meet if civility is maintained. This is not always easy to do, especially in small firm practice because things can feel very personal. Keep in mind that while law practice is a business, the clients’ needs come first. With that principle in mind, it is clear that communication is key, clients need to have choices, and client information needs to be protected.

The more professional both the lawyer and the firm are, the better off the client will be.

  1. <a href="">ABA Formal Opinion 99-414</a> goes into this point in great detail. 

  2. See <a href="">ABA Formal Op. 99-414</a> for more detail. 

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