"Cravath was one of the first longtime holdouts to cut bait and create a "salaried partner tier" (i.e., nonequity partners) back in November 2023. That move gave other highly ranked firms permission to tread the same path, including Paul Weiss, which announced its new two-tier partnership plan in March 2024; WilmerHale, which added a nonequity partnership tier in August 2024; Cleary, which announced its own new partnership platform in October 2024;"
"Now, we're seeing reports that Sullivan & Cromwell, the #25 firm in the country by gross revenue, has not only decided to develop its own nonequity partner tier, but at the same time, the firm has rolled out a new bonus program, all in the hope of improving retention and offering more partnership opportunities for attorneys. The American Lawyer has the scoop: The firm has a new "income partner" position, also known as a nonequity partner tier. Lawyers in these positions will "work alongside our equity partners, who will continue to own and govern the firm" and "create a new pathway to partnership for more of our lawyers," according to the memo. Sources familiar with the matter said S&C doesn't have a specific target number for how many nonequity partners it will make, but the firm will have a "strict standard" for the process."
Multiple marquee law firms have moved from single-tier partnerships to two-tier structures by adding nonequity or income partner positions. Cravath initiated a salaried partner tier in November 2023, followed by Paul Weiss, WilmerHale, Cleary, Skadden, Schulte Roth & Zabel, and Debevoise with similar moves through mid-2025. Sullivan & Cromwell has introduced an "income partner" position and a new bonus program to boost retention and broaden partnership options. Income partners will work alongside equity partners, who continue to own and govern. The firm expects income partners to be groomed for equity and intends to apply strict standards in selections.
Read at Above the Law
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