The Rise of Employee Owned Law Firms: A New Paradigm in Legal Practice

This guest article from eoa member Oliver & Co Solicitors – which became 100% employee owned in 2022 – explores how EO offers a sustainable and inclusive approach to law firm management, benefiting both employees and clients.

Image: The Oliver & Co team

Introduction to Employee Ownership in Law Firms

Employee ownership in law firms is a transformative trend reshaping the legal industry, offering a compelling alternative to traditional firm structures. This innovative model empowers employees by giving them a stake in the firm's success, fostering a culture of collaboration and inclusion.

The concept of EO in the legal sector began gaining significant momentum in the late 2010s and early 2020s. 

This shift has been quantified by an increasing number of firms transitioning to EO models, driven by the desire to enhance firm culture, improve client service, and achieve greater financial stability. 

For instance, the eoa reported a notable rise in employee owned businesses across various sectors, including law, with EOBs currently growing at over 30% per annum

Historically, law firms have been structured as partnerships or corporations, where decision-making power and financial rewards were concentrated at the top. 

Partners, directors, and senior executives traditionally reaped the most benefits, while associates and support staff had limited influence over the firm’s direction and profits. However, the landscape is changing as more firms recognise the benefits of EO. 

Key drivers behind this shift include the desire for a more inclusive and sustainable business model. 

The Solicitors Regulation Authority (SRA) and other legal bodies have also started acknowledging and supporting these new structures, which align with evolving client demands and the need for a motivated, committed workforce. 

Employee ownership addresses these challenges by aligning the interests of employees with the firm's goals, leading to a more motivated and committed workforce.

While the SRA has gained considerable familiarity with the EOT structure, law firms still need to obtain approval from the SRA and apply to become an 'Alternative Business Structure'. SRA approval is generally required for a law firm to transition to employee ownership. 

Although the SRA has comprehensive requirements, they appear, from our own experience, to respond reasonably quickly and helpfully to applications, demonstrating a good understanding of EOTs.

As firms face increasing competition and evolving client demands, adopting EO models has proven to be a strategic move. 

This trend is not only reshaping firm culture but also enhancing service delivery and ensuring long-term stability in a rapidly changing legal landscape.

Case Studies of Successful Employee Owned Law Firms

Oliver & Co: A Model of Employee Ownership

Oliver & Co is a prime example of a successful transition to employee ownership. 

Our journey began by looking at exit strategies with a vision to create a more equitable and engaging workplace. When adopting an EO model, there are three to consider:

1. Employee Ownership Trust (EOT)

  • In this model, a trust is established to hold a majority of the company’s shares on behalf of the employees. The trust operates in the best interests of the employees.

2. Direct Share Ownership

  • Employees are given or can purchase shares directly in the firm, either through share schemes or direct purchase options. This model allows employees to directly benefit from the firm’s financial performance.

3. Hybrid Models

  • Some firms use a combination of EOTs and direct share ownership to balance immediate employee involvement with long-term sustainability.

Oliver & Co chose the EOT model over the hybrid and direct share model primarily for its ability to provide a cohesive and unified ownership structure.

By adopting the EOT model, we aimed to nurture a strong sense of collective responsibility and long-term commitment among all employees. 

The EOT approach aligned closely with our goal of creating an equitable workplace culture where every employee shares in the firm’s success. 

Unlike the hybrid model, which can involve a mix of direct share ownership and trust-held shares, the EOT model offered a simpler and more integrated solution, minimising complexity and ensuring that all employees had an equal stake in the firm's future. 

This alignment with our values of inclusivity and transparency was a key factor in our decision.

The transition process was not without its challenges. It required a cultural shift, significant planning, and a commitment to transparency. However, the outcomes have been overwhelmingly positive.

The transition involved creating our EOT, which now provides employees who have been with the business longer than six months with equal shares of the firm regardless of their tenure and role. 

This plan not only incentivised performance but also instilled a sense of pride and ownership.

The transition also necessitated adjustments in management practices. Regular meetings are held to ensure positive collaboration, where financial performance and strategic decisions are openly discussed. 

Our employee-reps, which are voted for internally by each department, meet quarterly to bring new ideas in enhancing our business culture and practises.  

Further to this, every employee is now provided with an overview of the company accounts each quarter to ensure full transparency from each department. 

This openness fosters trust and collective decision-making, empowering employees to contribute ideas and strategies that benefit the firm as a whole.

At Oliver & Co Solicitors, EO has transformed our firm culture. Employees feel a sense of ownership and responsibility, which has led to increased collaboration and innovation. Most recently, the decision to install a gym in the office was passed by our employee-reps. 

Financially, the firm has seen improved stability and growth, as employees are more invested in the firm's success. The sense of collective responsibility has led to better financial management and cost-saving innovations. 

Comparing 2022/23 to 2023/24 for Oliver & Co Solicitors, stationery costs came down 9.5%. For the same years again, printing and copying costs were reduced by 25%. 

Ultimately, this improved financial management has led to a total of £3,000 income tax-free bonus’ for each qualifying employee since becoming employee owned in 2022.

Hosting the Annual Employee Owned Law Firm Conference at Chester Zoo this year allowed us to share our insights and best practices with peers across the industry, further cementing our role as a leader in this space. 

The conference was a testament to the collaborative spirit of an EOT. It provided a platform for firms to share their journeys, discuss challenges, and exchange best practices. It highlighted the collective wisdom within the employee owned sector and underscored the importance of a supportive network.

Benefits of Employee Ownership for Law Firms and Their Clients

  • Enhancing Firm Culture

EO offers numerous benefits for law firms and their clients. Firstly, it positively impacts firm culture. Employees who have a stake in the firm are more likely to feel valued and motivated. 

This sense of ownership leads to higher job satisfaction and lower turnover rates, which is crucial in an industry known for high levels of stress and burnout. 

When employees are co-owners, they’re more engaged and willing to invest extra effort, knowing that their contributions directly affect their own success as well as the firm’s.

  • Superior Client Service

From a client perspective, EO translates to superior service. When employees are invested in the firm's success, they are more likely to go above and beyond for their clients. This results in higher client satisfaction and stronger client relationships. 

Clients benefit from working with a team that is genuinely committed to achieving the best outcomes. Employee owned firms often report higher levels of client retention and more referrals, driven by the consistent quality of service delivered.

Oliver & Co recently received a strong testimonial that stated, “We were particularly interested to learn that Oliver & Co. operate with all employees as partners, having shares in their company. Obviously, a key ingredient in their success.” 

This testimonial highlights how our employee ownership model directly contributes to superior client service. 

As partners in the firm, our employees are deeply committed to the success and satisfaction of our clients, which has been a key factor in our firm's outstanding reputation and success.

  • Financial Stability and Resilience

Financially, employee owned firms tend to be more stable and resilient. Shared ownership encourages prudent financial management and long-term planning, which enhances the firm's ability to weather economic fluctuations. 

Employees are more conscious of expenses and resource allocation, often leading to innovative solutions that improve efficiency and reduce costs. 

The alignment of employee and firm interests creates a unified approach to achieving financial goals, ensuring the firm’s sustainability and growth.

Conclusion

The rise of employee owned law firms marks a new paradigm in legal practice. This model offers a sustainable and inclusive approach to firm management, benefiting both employees and clients. 

By fostering a collaborative and motivated workforce, employee owned firms are well-positioned to deliver exceptional service and achieve long-term success.

For law firms considering the transition to employee ownership, the journey may be challenging but the rewards are substantial. 

Oliver & Co's experience demonstrates that with careful planning and commitment, employee ownership can lead to a thriving, resilient, and client-focused firm. 

This article aims to inspire legal professionals, firm leaders, and industry stakeholders to explore innovative models for sustainable growth and enhanced client service. 

If you’re a law firm and want to discover more about employee ownership, discover more about the benefits, the types of EO, and eoa membership.

Share your insights and good news stories directly to our thriving community in the eo Hub. If you’re not already signed up, create a profile today and join thousands of others in our exclusive online member area. 

For anything related to stories, please email Dominic

For media enquires, contact Keely

14 Aug 2024
The Rise of Employee Owned Law Firms: A New Paradigm in Legal Practice
This guest article from eoa member Oliver & Co Solicitors – which became 100% employee owned in 2022 – explores how EO offers a sustainable and inclusive approach to law firm management, benefiting both employees and clients.
News
01 Aug 2024
Empowering Ownership: AI's Impact on Employee Owned Businesses
From upskilling employee owners and unlocking creativity to strategic initiatives to ethical considerations, explore how eoa members including Purplefish and Riverford Organic Farmers are shaping the future of AI in the EO sector.
News
18 Jul 2024
BCMS Marks Bold New Era with New Name Two Years After EO Transition
Employee ownership has transformed BCMS and its strategy. So much so that the specialist, independent sell-side corporate finance advisor has unveiled a brand new look and name.
News
17 Jul 2024
Ten Years of the EOT: A Decade of Great EO Commitment for and by the EO Sector
Ten years ago today, the employee ownership trust (EOT) gained royal ascent. Today we celebrate ten achievements linked to the EOT in the decade since.
News
10 Jul 2024
eoa International Ambassador Helps Denmark Get EOT Model Across the Finish Line
Denmark will set up an employee ownership model with equal tax terms for businesses to transition ownership – a hugely positive result that our International Ambassador helped get across the finish line.
News
08 Jul 2024
Thanks For Helping Make EO Day 24 the Best Yet!
Thanks to every single one of you took part in EO Day 2024 to celebrate being #ProudlyEO. It was our best year yet!
News
05 Jul 2024
CEO Blog: Activating Labour’s Pledge to Support Employee Ownership
We have a new era of government and, for the first time in ten years, there’s a clear manifesto pledge to increase EO. Our CEO, James de le Vingne, explores Labour’s promised support, our calls for immediate action, and our aims for the future.
News
04 Jul 2024
Shout About Being EO: Takeaways from our Leeds F2F
On the eve of the general election, dozens of members from across the eoa community came together at RSM’s Leeds HQ to explore the approach, governance, and structure of Great EO.
News
03 Jul 2024
The UK Employee Ownership Awards 2024 Have Launched
Nominations are now open for the prestigious UK Employee Ownership Awards, which celebrate the achievements of businesses that truly deliver people power.
News
03 Jul 2024
The National Self Build & Renovation Centre Celebrates 10 Years of Being an EOT
An early adopter of the employee ownership trust (EOT) model, Swindon-based business, The National Self Build & Renovation Centre (NSBRC), has marked a decade of being EO in style.
News
27 Jun 2024
Demystifying Great Governance: The role of EOT Trustees
Great governance is a key step towards achieving Great EO and a fundamental part of the EO Framework. But what exactly is it and how does it relate to the roles of Independent Trustee and Employee Trustee?
News
26 Jun 2024
The Power of eoa Community: Takeaways from our Bristol F2F
A cross section of the EO community came together in Bristol this week and walked away with answers, ideas, and where to get the best EO resources. Whether you joined us or not, here’s a quick look back at the event.
News
21 Jun 2024
EO Day 2024 – Proudly Showcasing the Answer to a More Thriving and Resilient UK Economy
From Scotland down to Cornwall, from Wales across to Hull, businesses that are growing and investing in the UK for the longer term are celebrating and raising awareness of a growing sector that is #ProudlyEO
News
19 Jun 2024
EO Emerges as Best Succession Option for Tech and Digital Transformation Consultants, PTS Consulting
After exploring all possible succession routes, employee ownership emerged as the best way forward for technology and digital transformation consultants PTS Consulting (PTS).
News
17 Jun 2024
How Employee Ownership Enables LGBTQIA+ People to Thrive
By distributing ownership and giving everyone a stake and a say, EO fosters workplaces where LGBTQIA+ employees can flourish, leading to a more equitable and representative corporate landscape. Join us for a closer look this Pride Month.
News
13 Jun 2024
CEO Blog Manifesto Week - No Upsets, No Big Surprises, But Plenty to Build on
James de le Vingne, Chief Exec of the eoa, dives into the manifestoes released this week, what they mean for employee ownership, and his hopes for an incoming government.
News
11 Jun 2024
Celebrating Financial Freedom with EO Day
Back in 2018, The 1:1 Diet by Cambridge Weight Plan used EO Day 2018 to announce its financial freedom. Here, our EO Day 24 sponsor relives a special day that will forever remain as a milestone moment for the business.
News
03 Jun 2024
How Britain’s First LGBTQ+ Certified Business Used EO to Better Embed EDI
For Pride Month, we spoke to Ed Riseman from eoa member The Big Group about running a business as an LGBTQ+ person and how employee ownership weaves EDI in the workplace to benefit all employees.
News
24 May 2024
The Power of Sensitive Succession Planning: Takeaways from our Scottish EO Exchange
This week, a cross section of Scotland’s employee owned sector came together in Edinburgh for our EO Exchange based around succession planning – sharing insights and experience amid news that Scottish EO businesses are skyrocketing.
News
22 May 2024
eoa Celebrates Third ‘Ownership Hub’ Pilot Launch in West Midlands
In partnership with the eoa, the West Midlands Combined Authority has launched its Ownership Hub project to grow employee and worker ownership in the region’s arts and creative sectors.
News
20 May 2024
Five Ways to Supercharge your EO at the eoa Annual Conference
Baxendale Employee Ownership, sponsors of the eoa Annual Conference for a third year running, break down five reasons why you should attend.
News
14 May 2024
eoa Launches Manifesto for Gov to Incentivise, Support, and Unlock UK EO Potential
The eoa has officially launched its manifesto calling on Government to unlock the potential of the UK’s employee owned sector.
News
03 May 2024
Ireland Makes History with its First Employee Ownership Trust
Ireland has announced its very first employee ownership transition using the employee ownership trust model – potentially paving the way for a vibrant new era of Irish employee ownership.
News
02 May 2024
Inspiration For EO Day – 50 Days to Go!
A handy guide to help you celebrate your employee ownership pride and make EO Day 2024 bigger and better than ever.
News
30 Apr 2024
‘A vehicle for unleashing employees’ potential’ – The Industry Club Goes EO
Creative recruiter, The Industry Club, has marked its thirteenth year by transitioning to employee ownership.
News
25 Apr 2024
CEO Blog: New eoa - Shaping the Future
James de le Vingne, CEO of the eoa, reflects on everything we unveiled at the People Powdered Business event and explores the exciting launches we've got planned for the next few months.
News
17 Apr 2024
Employee Ownership Underpins Scott and Fyfe’s Incredible Turnaround
Scott and Fyfe, a pioneering technical textiles company, has announced impressive profits which it attributes in part to employee ownership.
News
10 Apr 2024
Optimum Coatings Ushers in Era of Business Success in Morecambe with Move to EO
Optimum Coatings has reaffirmed its commitment to its vibrant local community, recognised the contributions of its employees, and secured long-term business stability by transitioning to an Employee Ownership Trust (EOT).
News
08 Apr 2024
Demonstrate Your Employee Ownership Pride Ahead of EO Day
We’re rapidly approaching the twelfth annual EO Day, uniting the sector to celebrate the power of Great EO.
News
02 Apr 2024
eoa Welcomes Graeme Nuttall OBE as its First Official Ambassador
Graeme Nuttall OBE has joined the eoa as International Ambassador, with a focus on developing and promoting international best practice for employee ownership.
News
28 Mar 2024
Interact Becomes the First Employee Owned Contact Centre Outsourcer
Interact has become the UK’s first employee owned contact centre outsourcer after selling the majority of its shares into an Employee Ownership Trust
News
13 Mar 2024
The Countdown is on to Celebrate ‘Proudly EO’ Businesses for EO Day
There’s only a 100 days until this year’s EO Day. We guarantee it’ll be here before you know it. So mark your calendars for Friday June 21, appoint an EO Day lead, and/or assemble your team, and plan your EO Day activity.
News
11 Mar 2024
Purplefish Announces Transition to Employee Ownership
Purplefish has become the first PR agency in Bristol to make the move to employee ownership after founder Joanna Randall sold all of her shares to an Employee Owned Trust.
News
08 Mar 2024
Empowering Equality: The Impact of Employee Ownership on Gender Diversity in Business
We spoke to a few of the female senior leaders in the eoa community to understand how a variety of EOBs from across different industries are empowering women.
News
07 Mar 2024
eoa Backs Calls for Policy Reform to Fix UK Economy
A cross-sector report launched today in Parliament by the Future Economy Alliance calls for a dedicated UK Government Minister to overhaul economic policy.
News
07 Mar 2024
What Does the Spring Budget Mean for Employee Ownership?
The Spring Budget presents missed opportunities in building a more prosperous economy; developing the role of EO, and further unlocking its impacts for businesses, employees, and our wider society.
News
21 Dec 2023
eoa Part Of Collective to Engage with Government On Future Economy
The eoa attended a meeting with Business Minister Kevin Hollinrake and the Prime Minister’s Business Adviser Franck Petitgas, as part of a collective to discuss the key issues of interest to employee owned, family and small businesses
News
29 Nov 2023
Employee Ownership Pioneers and Exemplars Celebrated at EO Sector Awards
A night of celebration was enjoyed by 800+ people at the UK Employee Ownership Awards, at the ACC Liverpool, last night (Monday 27th November 2023) with five winners celebrating success.
News
21 Nov 2023
Action to Educate Businesses on EO Succession Could Save Thousands of ‘at risk’ Jobs and Businesses
The eoa welcomes research that shows how many business owners will be looking to sell, divest or liquidate their shareholding over the next 10 years in the report 'Generation EO: The Great Succession Opportunity'.
Research
21 Sep 2023
eoa Responds to Government Consultation on EOTS and EBTs
The eoa has submitted its response to the government's consultation on EOTs and supported its members to do the same - as part of its policy priority to ensure the conditions for employee ownership to grow.
News
31 Aug 2023
Why We’re Sharing our Policy Priorities for the EO Sector
We have worked with our members to co-produce our policy priorities to make sure their interests and that of the EO sector is represented in our influencing work.
News