Partner and staff reductions
Restructuring can be necessitated by a reduction in size, possibly from a partner retirement or from recessionary effects. Whatever the reason, careful planning and the proper advice will make sure that the remaining business does not suffer.
Partners leave practice for many reasons, but often it is simply part of a retirement process. In this circumstance, forward planning is essential where it is known about sufficiently in advance.
Key issues include:
- Cashflow planning for capital withdrawal
- Succession planning for replacement if necessary
- Management of the partnerships clients and communication
- Partnership agreement as this is an essential document that all practices should have and should regularly review, especially on major occurrences such as changes in the partnership members
- Staff reductions – this is mainly a recessionary occurrence and will be brought about by a need to make cost savings. However, it will often happen following a practice merger and will have been part of the strategic synergy to be realised from the merger
Again, planning and good, timely advice are key. If numbers are more than single figures, it will certainly be necessary to engage a specialist adviser to deal with employment and redundancy issues in a proper manner.