Have You Ever Made the Wrong Lateral or Leadership Hire?
The Hidden Costs Add Up — Fast
In a law firm, the true cost of a bad hire extends far beyond compensation. When an attorney or senior leader fails to integrate, the financial and strategic impact compounds quickly.
Hidden and indirect costs often include:
Unrecoverable salary, bonus, and benefits
Lost billable hours and reduced team productivity
Significant partner and leadership time spent managing the issue
Disruption to client relationships and service continuity
Reputational impact—internally and in the market
Increased attrition among associates and staff
Replacement search costs and recruiter fees
Why High-Performing Law Firms Obsess Over First-Year Retention
Most firms will monitor overall attorney turnover. The best firms go further. They track first-year retention —specifically, how many lateral hires remain beyond their initial 12 months.
Why? Because the greatest financial risk and lowest return on investment sit squarely in that first year.
A $400,000 lateral hire who exits before their first anniversary doesn’t just cost salary and benefits. Once lost billables, leadership distraction, client disruption, and replacement costs are factored in, the true financial impact can easily exceed $1 million.
That’s why smart law firms focus less on filling seats—and more on getting the hire right the first time.