How can I deal with an employee that should have been fired a year ago?

I work with a woman who spends all day talking to her family on the telephone, and talking to clients like they are dirt. She calls in at least once a week and has so for a complete year. She lies uncontrollably and when confronted by the partners about her actions has disregarded their comments completely. I have even caught her pluging time into client accounts. Everyone at the firm believes she should be fired, the problem is that the company has not fired her and this has been going on for two years (believe it or not). Is there any legal action that can be taken against her or the company for her unethical and unprofessionalism (she came to work in bunny slippers one day!)? I have come to my witts end along with a handful of other employees. I have talked to 2 of the 3 partners about our issues and we receive the run around. Does anyone have any suggestions on how to handle this crazy situation?

I could go on forever, please help!

This has been discussed with the president of the company by at least two employees, and two other partners...

There seem like multiple ways to submarine this woman.

Falsifying billing is a crime in and of itself.

Who runs / owns the company. I'm sure they wouldn't mind an anonymous tip on her behaviors.

Verbal warnings, written warnings then a pink slip. You haven't said where you are but I am guessing US. Has she ever been approached by her lack of professionalism, attitude to work, co-workers etc? What is your position in the company? Are you able to fire her yourself, or do you need to approach the higher ranking powers that be and make things happen?

Maybe they like her plugging time in the accounts..
They are not stealing but, they don't mind her doing it for them. I can't think of anything that you can do at this point.

she must be sleeping with the boss or something

are you an employee or employer to this lady?

i had a similar problem with a manager at a shop i worked for before she wud sit constantly out the back on the phone to her friends family or other managers from other stores bitching....she wud talk about members of staff behind their back and she was supposed to b the manager....she would come in late go home early and never tell her area manager and expect us to lie for her...she bullied younger members of staff....she wud burden customers with her homelife problems to the point where customers wud stand by the door and ask if she was in and if she was they wud say i'll come back another day...she constantly went on and on about her partner l