[1]Wearing: Record year
Staff at Ison Harrison, one of the largest law firms to be employee owned, have each received a tax-free profit share of £3,600 after the first year of the new structure.
The Yorkshire practice had its best-ever year, posting a 14% increase in turnover in 2022 to over £19m.
Managing director Jonathan Wearing told Legal Futures that moving to employee ownership had contributed to the success – by giving staff a stake the firm’s performance – but that he expected it to have a bigger effect now they had seen the direct benefit.
Staff were told of how much they would each receive – irrespective of role and whether they are full- or part-time – at the firm’s Christmas party. It was, he said, “incredibly well received”. The payment is separate from any individual performance bonuses.
“We were told before we converted that there was likely to be a bounce but I don’t think we’ve really had it yet,” Mr Wearing said. “I think we will this year because [receiving the profit share] has made it real.”
The same went for the level of staff turnover, he said, which did not change much last year.
Mr Wearing said the distribution had been higher than anticipated due to the success of the year, which he also put down to “the economic climate putting wind in our sails” – particularly its conveyancing practice – and the growing maturity of the offices it has opened across Yorkshire in recent years.
At a time when many firms have reduced their footprints, he described the office openings as having a “snowball effect”, bringing in more clients through better visibility and more word of mouth – now topping 20,000 in all. Ison Harrison opened in Wakefield last year, its 17th office.
The firm, which has over 240 staff, became 100% employee-owned [2] after Mr Wearing and his two co-owners decided it was the best way to deal with succession. They are being paid for their shares over 10 years.
The management structure changed to add five directors to the existing trio. Mr Wearing said their “fresh energy, direction and enthusiasm” had also contributed to the results.
“The model has created stability, continued job security for all of our staff and a strong platform for further growth,” he added.
Asked how being employee owned had changed Ison Harrison, Mr Wearing said one significant difference was “a greater responsibility on management to get it right”.
He explained: “As a partner, if it’s a bad year, it’s my problem. As an [employee-owned business], it’s everyone’s problem.”
Staff were more interested in understanding the firm’s expenses and costs, he said, while there was a “different layer of openness”.
“We talk about profit openly, which was only thing we didn’t speak about openly before. [Being employee owned] is building on a culture that was already there. There’s not been a step change in how we operate but it’s brought greater clarity.”