The Saddest Thing

I was feeling a little depressed, oppressed, and stressed yesterday. I pulled the “Auditors and Gambling” post out of the ether, really. The subject had been on my mind. The survey activity prompted a few to ask me if I had thought about how to make money off the process or the results. The cacophony of carnival barkers on CNBC provided a backdrop to my thoughts of the casino like nature of our very existence these days.

We bet on which school to attend. Will I get the classes I need, the instructors I want, the grades I require to get out of there with something of value?

We bet on our first job. Will it be the launching pad for  a career or just a way to pay the loans and bills?  Is it a good place?  Will there be people I can learn from?  Will they like me?

We bet on a partner for life. (I won’t dwell on that here. It’s too fraught with emotion for me.)

We bet on buying a house. More than ever that was a gamble in the past and for some it paid off, for others they’ve found it to be less of the “nest egg” than they’d hoped.

We bet on our employer and other companies as good choices to invest our savings. We hope that those we trust to provide reliable, transparent, timely and accurate information are doing so.  We approach the exercise in good faith.

We bet on our brains, and our brawn in some cases, to carry us through. We work hard, have faith, and trust those in positions of responsibility and stewardship to fulfill their vocations honorably.

I have actually been told by some that I am still too optimistic about the profession. Maybe there are people to whom I have given the benefit of the doubt, and more, on this blog, who don’t deserve it. If  you feel the game can still be played fairly, with reason and discussion, under a predictable set of rules, with expected results, then you play. You write your little blog, and hope to influence those that are in a position to make changes that will help.

But, then you start to see that the game is probably rigged, that there’s no more “best interest,” only “self-interest.”

What’s a girl to do?

The unexpected thoughtful responses to my post on the wage and hour suit PwC is facing in California, one originally intended to be more informational than insightful, weigh heavily on me. Are the Big 4 firms profit-making private partnerships that have a right to do whatever is in the interests of their partners only, according to those partners level of contribution and influence in the firm? Are the partners really the only ones that matter given this model?

Or are the firms part of the capital markets structure, part of the business community, part of local communities, with employees, customers, vendors,  and other stakeholders who must be considered? Is a private profit-making partnership the best model for carrying out the responsibility, the obligation of protecting shareholder interests in this complex, global market environment we find ourselves in?

Finally, the saddest thing for me is the ongoing dialogue I have with those at the beginning of their careers. It may surprise you to hear that I rarely, if ever, dissuade someone who has set their entire course, worked their tail off, ran towards that light at the end of the tunnel that is a job in the Big 4 at graduation, from taking one of those positions. I may counsel them about a particular firm or office at a particular point in time. I may insure they know what they want and have asked the right questions. I  may encourage open dialogue with a sponsor or mentor early in the process in order to insure that they have the benefits of kind and generous career and personal support I had at KPMG Consulting.

But until a few days ago, I had never considered advising anyone to look at other options.  Until a few days ago.

That saddens me.

***********************

Here’s a link to an article in the ABA Journal regarding the Sidley and Austin case referred to by our most recent commenter. The article also includes a link to the consent decree signed by Sidley. The settlement by Sidley sets an important precedent and is of interest, I think, to all those “partners” in the audit firms, who are in effect, merely “employees” given the lack of control they really have over their careers and management of the firm.  If the going gets any tougher out there, we may actually see partner demotions and cuts in the Big 4.

Although the firm didn’t admit wrongdoing in a consent decree (PDF) approved yesterday by a federal judge, the case is important to law firms because of the precedent it sets concerning the definition of partnership. As discussed in an ABA Journal cover story in 2005, the EEOC contended that a number of Sidley partners were actually employees–and hence protected by laws against age discrimination—because the firm treated them as employees even though it called them partners.

In the consent decree, Sidley “made a significant concession,” reports the Los Angeles Times. It was: agreeing that “each person for whom the EEOC has sought relief in this matter was an employee” for the purposes of the Age Discrimination in Employment Act.

The case—which was brought by the EEOC itself rather than individual partners—resulted from an October 1999 demotion by the firm of 32 partners, allegedly based at least in part on their age. Financial details of the settlement are discussed in another ABAJournal.com post.

“Up to now, with no particularly good reason that I can discern, people in control of law firms said that if they called someone a partner … they didn’t need to worry about federal employment discrimination laws,” says John Hendrickson, the EEOC’s regional attorney in Chicago.

“What the Sidley case says is that you have evidence that people are called partners, but in reality are not active in the governance of the firm and don’t control their own destiny in the firm,” he tells the Times. “You can call them whatever you want, but for the purposes of the Age Discrimination Act they are employees.”

**************

Here’s a link to my post where I discuss the problem of size in a partnership.