Legal Business Blogs

Tip of the iceberg: Beckwith prosecution sparks Freshfields misconduct and financial penalty clampdown

Freshfields Bruckhaus Deringer has ushered in radical reforms to handling misbehaviour, including financial penalties, as the #MeToo fallout intensifies following former partner Ryan Beckwith’s prosecution for sexual misconduct.

The move sees a conduct committee established and new enforcement protocols which mean partners under internal investigation will receive a final warning about their behaviour and face an automatic fine equal to 20% of their profit share for 12 months.

The reforms come following the very public embarrassment Freshfields faced in the month that the Solicitors Disciplinary Tribunal (SDT) fined former partner Ryan Beckwith £35,000 and ordered him to pay £200,000 in legal costs following a high-profile hearing concerning sexual activity with a junior lawyer in his team.

The new rules are being implemented through a draft consultation and would require changes to the firm’s members’ agreement. The objectives are: ‘aligning the firm’s partner conduct and disciplinary process across the firm; supporting the objectives of the culture and behaviour programme; and meeting the expectations of our clients and regulators’.

Freshfields would establish a conduct committee – a subcommittee of the partnership council – to oversee investigations and decide outcomes.

The members’ agreement would also be updated to differentiate between forced retirement for misconduct reasons and other reasons including underperformance, enabling the partnership council to suspend a partner who is the subject of an investigation.

Beckwith was suspended last December and resigned this month [10 October] after the tribunal found he knew or ought to have known that the junior member of staff was intoxicated and her judgement impaired and that he knew or ought to have known that his conduct was inappropriate.

The tribunal found Beckwith’s behaviour was in breach of principles two and six of the solicitors’ code of conduct, requiring solicitors to ‘act with integrity’ and ‘behave in a way that maintains the trust the public places in you and in the provision of legal services’.

Freshfields’ protocol will include guidance on what constitutes improper behaviour and provide clarity on what circumstances will be considered to mitigate an outcome, and what are aggravating factors.

Senior partner Edward Braham said: ‘We are committed to improving behaviour and inclusiveness. For more than a year we have been running a global behaviours programme to drive culture change, which includes reviewing and adjusting our HR processes, governance and systems across the firm. We want to ensure that positive behaviour is consistently valued and that inappropriate behaviour is called out and acted upon. The plans for a conduct committee and protocol are part of this ongoing programme across the firm.’

#MeToo-related problems have become a constant for the legal industry, with further disciplinary hearings relating to sexual misconduct concerning former City head of Baker McKenzie, Gary Senior, and Allen & Overy employment partner Mark Mansell both set to appear before the SDT in December. The former case involves allegations against Senior, while Mansell’s hearing focuses on the wording of a controversial non-disclosure agreement the A&O lawyer drafted for Harvey Weinstein back in 1998 concerning claims of harassment made against the film producer. It is inevitable other City firms will be forced to follow Freshfields’ lead.