Creating a culture of well-being entails thoughtful reexamination of the traditional compensation models and metrics for lawyers. This does not mean dispensing with the billable hour model entirely, but it does mean assessing alternative or additional ways to compensate lawyers and staff for performance. The billable hour can be a major source of stress and anxiety. Considering how to value lawyers and staff’s contributions in other ways may positively impact this well-being risk factor.

Multifactor compensation systems are one possible starting point. These models should focus on both results and professional growth. Multi-factor compensation structures can also tie to laudable outcomes, such as a successful result for a client or positive client feedback.

Consideration should also be given to bonus compensation structures that consider more than a lawyer’s impact on the organization’s profits realized. Legal employers can look to client results, going above-and-beyond on a certain project, and a willingness to take on new challenges and be supportive of other members of the firm. The goal is to reward employees for involvement in activities that both enhance the firm’s bottom-line and that they find fulfilling on a professional level. Doing so will bolster overall morale and well-being and promote a culture of initiative taking within the organization.

Taking a careful look at performance evaluations is another way to reduce stress and the mystery associated with who advances and who does not. Firms should implement fair and objective performance evaluations with explicit, objective, observable, and measurable criteria applied fairly to all employees.

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Recommendations:

Action	Challenge Level
1.      Provide equal access to training and education for client development (“Rainmaking”) skills.	Easy
2.      Provide bonus compensation tied to metrics other than strictly hours billed, clients retained, or profits realized.	Moderate
3.      Assess and consider modifying your performance evaluation system.   Put in place fair and objective performance evaluations with explicit, objective, observable, and measurable criteria applied equitably to all employees.  Assure that all employees are fully aware of the factors considered in the performance evaluation system.  Provide a good faith objective assessment to junior lawyers of how and when they can expect advancement in the firm.	Moderate – Challenging
4.      Evaluate and incorporate alternative pricing models that provide cost predictability to clients and generate profit in ways other than hours billed.   Examples of these pricing models include flat fee, subscription services, and unbundled representation.	Moderate – Challenging
5. Conduct regular Compensation Benchmarking. Compare your organization’s salaries, benefits, and perks against industry standards, regional cost-of-living indexes, and competitors. Include metrics such as workload expectations tied to compensation levels. This ensures fair pay, which reduces financial stress and improves morale, demonstrating that the organization values its employees.	Moderate – Challenging
6.      Consider implementing multi-factor compensation structures.   These structures may focus on client results and professional growth and development. These structures should also incentivize involvement in activities that promote balance and well-being. Consider providing billable hour credit for pro bono work, legal community activities (such as bar association or organization leadership) or well-being activities. Explain this multi-factor compensation structure to all attorneys. If it is appropriate for the organization, evaluate whether an open compensation system might positively impact the organization’s culture and advance well-being among lawyers.	Challenging