Disengagement Isn’t Quiet, It’s Costly (We Did the Math).
We’ve all heard it: It costs more to hire someone new than to keep the person you have. Sounds obvious, right? But in a law firm, the actual numbers can make you stop in your tracks.
Have you ever sat down and really worked out the cost of losing a mid-level associate or a key staff member? We have. And the total might change the way you look at engagement entirely.
Here’s the thing: bring up employee engagement and most people picture burnout, low morale, maybe a few quiet grumbles around the office. But when a single lawyer walks out the door, the financial impact hits equally as hard.
The quiet exit of a disengaged employee doesn’t just leave an empty desk. It chips away at client’s trust, slows down teams, and yes, can even drain the firm’s profitability.
Low engagement isn’t a “soft” HR metric; it’s a hard-dollar hit, and the numbers don’t lie.
The Tangible Costs: A Hypothetical Mid-Level Associate
Put your accounting hat on, this one is going to make you think! When lawyers check out mentally or worse, leave altogether, the ripple effect is costly. Law firms face a unique multiplier effect. Replacing a high-billing associate isn’t just salary and recruitment cost; it’s lost client billables, missed deadlines, and reputational risk.
Let's imagine a 4th-year associate with a salary of $300,000 decides to leave. This isn't just about finding a replacement; it's a cascade of direct and indirect costs.
Recruitment Costs: A legal recruiter typically charges 20-25% of the first-year salary.
Scenario 1: Using an External Recruiter: Cost - $300,000 x 25% = $75,000
Scenario 2: Using Your Internal Recruitment Department:
Assume the fully-loaded cost (salary + benefits + overhead) of an in-house legal recruiter is $200,000 per year.
A search for a mid-level associate can easily consume 150 hours of that recruiter's time (sourcing, screening, coordinating interviews, managing candidates).
Based on a 2,000-hour work year, the hourly cost of that recruiter is $100.
Cost - $100 x $150 = $15,000
While this is a significant saving over an external search, it is still a substantial, hard cost to the firm. In summary, the likelihood of finding a successful replacement using internal resources are slim and since the pressure to replace is high most firms work with external recruiters for their associate searches.
Internal Time Costs: Think of the non-billable hours your partners, hiring committee, and HR team spend sourcing, screening, and interviewing candidates. Let’s conservatively estimate 60 hours of partner and senior associate time. At an average blended rate of $800/hour, that’s significant.
Cost: 60 hours x $800/hour = $48,000
Revenue Loss: This is a two-part problem. First, the vacant seat isn't generating revenue. Let's assume a 3-month search. Second, a new hire takes time to ramp up to full productivity, often 6 to 12 months. Let's conservatively estimate the total lost billable revenue during this transition at $150,000.
Onboarding & Training Costs: This includes administrative setup, formal training programs, and the time other team members spend getting the new hire up to speed.
Cost (Estimate): $10,000
Let's tally that up. The total tangible cost formula looks something like this:
Total= $75,000 + $48,000 + $150,000 + $10,000 = $283,000
(Total = recruitment + time + productivity + training)
That's nearly the associate's entire annual salary, just to replace them. This figure doesn't even account for the "disengagement dip"—the period where the departing employee was likely less productive before they resigned.
The Hidden Toll: Intangible Costs 📉
The costs you can't enter into a spreadsheet are often the most damaging. Low engagement that leads to turnover creates ripples across the entire firm.
Loss of Institutional Knowledge: The departing associate takes with them specific knowledge about clients, matters, and internal processes. This intellectual capital is invaluable, and its loss can lead to errors and inefficiencies.
Damaged Team Morale: When a colleague leaves, especially a respected one, it can demoralize the remaining team. They are often left to pick up the slack, leading to burnout and potentially triggering a domino effect of more departures.
Client Relationship Disruption: Clients build rapport and trust with specific lawyers. A sudden change can weaken that relationship, creating an opening for competitor firms to step in.
Reputational Harm: High turnover rates become known in the legal community. This can tarnish your firm's employer brand, making it harder and more expensive to attract top-tier talent in the future.
Seeing employee engagement as just another “cost center” misses a big financial truth. Sure, someone might argue that replacing an associate at $223,000 is still less than their $300,000 salary. But that’s not the point—and it’s a costly mistake to think it is. The salary is already baked into your budget. That $223,000? It’s money you never planned to spend, a preventable hit that delivers nothing back to the firm. And every time it happens, it chips away at profitability.
A Call to Action for Talent Leaders
For Talent and Practice Management leaders in law firms, the takeaway is clear: engagement isn’t just about morale, it’s a strategic lever for profitability, client satisfaction, and long-term firm health. The most effective leaders don’t wait for exit interviews to diagnose problems. They build systems that continuously listen, learn, and adapt.
Start by asking three simple but powerful questions:
Do we know, in real time, how engaged our people truly are?
Can we spot the early warning signs—months before a resignation letter appears?
Are we prepared to act quickly and decisively when we do?
The smartest firms don’t wait for turnover to tell them there’s a problem—they track engagement and act before it costs them top talent. Legal-specific tools like OneRetain make this easier by helping firms monitor engagement in real time, spot turnover risks months in advance, and identify development gaps before they drive people out the door. These capabilities give HR and Talent leaders the insight they need to address burnout early, keep teams connected, and protect the relationships and expertise that clients depend on.
The return on investment is clear: catching disengagement early costs far less than replacing a star performer.
