Carol Harrington’s career as an estate-planning attorney has been marked by a lot of “firsts.”
She has risen to the top ranks of her profession over four decades through a combination of smarts, hard work and negotiating skill. She is celebrated on various professional lists as one of the country’s top estate planning and wealth management attorneys.
Harrington is an equity partner, and since 2006 has headed up the private client practice group at McDermott, Will & Emery, a 1,100-lawyer-strong international firm with offices in the U.S., Europe and Asia. As practice group leader, she oversees some 70 lawyers and 30 non-lawyer professionals.
The firm’s private client practice advises high-net-worth families, closely held business owners and corporate executives and professionals. Harrington’s clients generally have assets in the $30 million to $50 million range.
Harrington’s career path has been marked by several firsts, including promotion to equity partner while working on reduced time to rear two children and appointment as the firm’s first female department head. As an equity partner in her firm, she still finds herself in a small minority of female attorneys.
Only 17% of equity partners at the country’s top 200 law firms are women, according to a 2014 survey by the National Association of Women Lawyers. “This year’s results reinforce that women in private practice continue to face barriers to reaching the highest positions in their firms—as equity partners and members of governance committees,” Stephanie Scharf, the report’s author, said in a statement announcing the results.
Working Mother
Harrington is not one to claim that women have to work twice as hard as men in order to succeed. But she says women of her generation “had to be smart to get into law school”—and she doesn’t deny she was smart. After graduating summa cum laude with a bachelor’s degree in mathematics from the University of Illinois in 1974, she attended the university’s College of Law, where 15% of the students in her class were women. She was awarded a J.D. magna cum laude in 1977.
Today, more than 40% of law school graduates are women. Progress to be sure, but the 2014 NAWL report noted that 64% of women occupy the lowest position in the top 200 law firms, that of staff attorney.
In 1977, Harrington joined the Chicago office of Winston & Strawn as an associate. She gave birth to her first child in 1982 while still an associate, and when she returned to work from maternity leave early the next year, she changed her status to reduced time. In 1984, she was promoted to non-equity partner.
She was still working reduced time in 1988 when she made a lateral move to McDermott Will. “When I joined MWE, its practice was to not promote someone who was reduced time,” she says. In her negotiations with the firm’s leadership, she asked for an understanding that she would not be barred from consideration of equity partner status solely on that basis. “I asked for a commitment that if I were not promoted, it would be because I was not achieving what they expected from equity partners on a basis other than low billed-to-client hours.”
Harrington joined the firm as a non-equity partner on reduced time, with a total billable and non-billable commitment of 1,600 hours. She was promoted to equity partner in 1992 while still working reduced time. “My total time was always greater than 1,600 hours, although my billed-to-client hours started out about 1,200 to 1,300, and gradually increased as my children got older to 1,400, then 1,500 and finally to about 1,800 in 2002,” she says.
At the same time, she continued to spend several hundred hours each year on speaking, writing and bar association activities. “When the non-billable hours were added to my billed-to-client hours, my total time commitment was often what others would have seen as full time once the children were a little older,” she says.
Harrington was the only reduced-time equity partner at McDermott Will for several years until the policy of barring reduced-time promotions was eventually changed. “I thought that the policy of barring promotion was a little unfair, because there was a wide range of billed-to-client hours at the equity partner level and something that could be handled as a compensation issue rather than a title issue,” she says. “However, there were many, including some women equity partners, who felt strongly that younger women lawyers should not be promoted to equity status without a full-time commitment on the billed-to-client side.”
That resistance appears to be well entrenched. A study by Working Mother Media & Flex-Time Lawyers LLC found that while 48 of the 50 best law firms for women allowed reduced-hour lawyers to be eligible for equity partnership promotion, no lawyers in 2014 were working reduced-hour schedules at the time of their promotion. In 2013, an average of one lawyer was working a reduced-hour schedule when promoted.
In 2006, Harrington became McDermott Will’s first female department head, assuming responsibility for private clients. She retained that position in 2008 when the firm restructured, creating 16 practice groups, including the private client group. Today, she says, women also lead the firm’s practice groups for intellectual property litigation, regulatory and state and local tax.
Tax Expert
Harrington joined Winston & Strawn at a fortuitous time for her career. This was a year after Congress had passed the Tax Reform Act of 1976, which included a section called Tax on Certain Generation-Skipping Transfers. She says her mentor, Fred Acker, the firm’s head of the estate planning practice, asked her to educate herself on this new tax as no one in the firm had a grasp of the provision. The 1976 GST tax was seen by many observers at the time as extremely complicated and was heavily criticized.
The GST tax is incurred when a donor transfers property in the form of a gift during life or at death to a beneficiary more than 37.5 years younger, who is usually the donor’s grandchild. The aim is to ensure that a transfer tax is paid on assets placed in a trust for a child when the trust moves to the grandchild, and also when property is given directly to a grandchild, outright or in trust. The GST tax applies only to amounts in excess of the generation-skipping tax exemption—originally $1 million, now about $5.3 million, per donor.
In 1986, Congress repealed the 1976 GST tax and replaced it with a revised GST tax that applies today, following several modifications over the years. Today, the GST tax applies at the same rate as the estate tax of 40%. Its exemption, which is indexed for inflation, of $5.3 million is the same amount as the estate tax exemption but is a separate exemption, as the taxes are separate taxes.
Harrington has followed the evolution of the GST tax throughout her career, and in the process has become one of the country’s foremost experts on the tax. She has co-written a book and more than a dozen articles on the subject and advised tax professionals, attorneys, executors, trustees and others.
Harrington has spoken frequently at professional conferences, during one stretch giving an average of six speeches a year. She says she has cut back that activity in recent years. Today, she spends about half her time involved in administrative duties as practice group leader and the other half advising clients on tax issues, closely held businesses and succession planning, private trust companies, private foundations and trust and estate administration.
“I’m very grateful to have had the opportunity to work in a challenging profession, associating with highly intelligent people,” she says. “And the pay is good.”
