Nationwide Pay Raise Watch: Kilpatrick Stockton
One of the firms from this morning's open thread, Kilpatrick Stockton, recently announced associate pay raises.
We heard the news from multiple sources. Here's what one had to say:
Kilpatrick Stockton raised salaries on Friday, effective 1/1/08 (in all markets). 145K in Atlanta and all NC offices, 160 in NY, DC and for IP associates firm-wide.Only first year numbers have been released. Presumably, the NY, DC and IP scale with be the standard uncompressed 160 scale. The firm, like many others, is waiting for things to settle in Atlanta and expects (based on the need to match others) to substantially exceed Alston Bird's scale.
From a second tipster:
[H]ere is Kilpatrick Stockton's memo on raises (issued at 4:34 on the Friday before the long weekend). Note that it looks as though the capital markets group will not be getting the same raise as everyone else (they are now 15K/yr ahead of everyone but IP).
The complete memo appears after the jump.
KILPATRICK STOCKTON LLP -- ASSOCIATE PAY RAISE MEMO
August 31, 2007
To: All Associates
cc: All Partners and Counsel
From: Diane Prucino
Re: Increases in Associate Compensation
As you know, starting salaries for new associates have recently increased, for the second time this year in some of our markets. Consistent with our philosophy of paying competitive salaries, we are announcing today increases in the starting salaries in some of our offices and markets, to be effective January 1, 2008.
Effective on that date, we will pay a starting salary of $145,000 in Atlanta and North Carolina and $160,000 in Washington, D.C., New York, and IP Patent. The starting salary in Augusta will remain $85,000. As in the past, we will be increasing our compensation scales for associates at all levels to reflect this increase.
We are studying the market in the capital markets practice to determine if any adjustments are warranted with respect to the existing capital markets scale. We remain committed to paying competitive compensation to our lawyers who practice in that area, but are not currently making any changes to the existing capital markets scale.
When we increased salaries for many of you earlier this year, we chose not to increase our minimum billable hours requirements immediately, although we indicated that we might do so later in the year. Currently, our firm requires Level 1 associates to bill 1800 hours (of which 100 can be pro bono and/or training) and requires more senior associates to bill a minimum of 1900 hours (of which 50 can be pro bono). Effective at the beginning of the associate evaluation year beginning on October 1, 2007, we are increasing those minimums to 1900 for Level 1 associates and 1950 for more senior associates (with the same credits for pro bono and training time).
Thanks to all of you for your contributions and hard work on behalf of our Firm. We believe that these new, higher compensation levels will enable us to continue to attract and retain outstanding lawyers who will contribute to our success in 2008 and beyond. If you have any questions regarding these compensation increases, please feel free to contact either of us.
(38) Comments
First?
First!
85 in Augusta? I know it is cheap, but come on... How could anyone live on 85k? (with the notable exception of L2L)
This should bump them off the "Top 100" thread! $85k is Fargo is absurd for any respectable firm. I am sure they are billing their associates out at levels justifying more money. In addition, the overhead is cheaper in smaller markets, so the compensation should not be in the tiolet like this.
Respectable firms with small outposts don't screw associates like this. Hogan has such small offices and pays just under larger markets.
Is there any other firm that raised its D.C. salaries effective Jan. 1, 2008? Not even close to matching the market.
Does this mean a $15K increase for all associate years in Atlanta?
According to some silly cost of living calculator, 85K in Augusta is equivalent to 191K in New York....except with 191K in New York you wouldn't be able to live on the same block as the Partner you work for (as you could with 85K in Augusta).
Another fine example of the business sense shown by a law firm. It makes absolute sense to raise salaries while the market is tanking and prospective layoffs loom large.
AFP - What universe are you on? The market is tanking?? Which market? Last I checked, the Dow, Nasdaq and S&P are all up YTD, around 5% for the S&P and 7-8% for the Dow and Nasdaq. All of this despite the recent scare over liquidity. (A scare which has, for the most part, dissipated. The Dow is up nearly 1000 points from its intraday August low).
The bottom line is that deal activity will still be up 20% from 2006's record year. The amount of work has increased significantly, while the number of graduates from the top law schools remains the same. Firms have to either raise salaries to compete, or reach further down in the pool of available workers.
Not surprisingly, the top firms continue to raise salaries, and will continue to do to compete with each other for top talent.
Augusta to $85k!
That's one crappy pro-bono policy.
12:50 -- what pro bono policy are you talking about?
Max 100 hours for juniors, max 50 hours for seniors. That precludes a lot of pro bono work.
12:29 - following up - of course, one can't complain with a minimum of 1800-1900 hours.
12:59 & 12:45 -- It does not preclude pro bono work. You can do as much pro bono work as you want. Attorneys receive bonuses for their pro bono hours. What the memo states is that for senior attorneys you can have up to 50 hours of pro bono count toward your billable requirement.
coincidence that they announce the salary increase a day before Lat posts the Vault discussion group including KS?
I think NOT! Bravo Lat!
TO: 12:59 "precludes a lot of pro bono work?"
And? If you want pro bono, go work for the Legal Foundation, or some other charity. Big Law is for billing and making money. Take your hippie crap elsewhere.
2:07 -- you must be confused. Those hours are the amount of pro bono work that associates can count towards their billable requirement. Associates are not precluded from doing more pro bono work than the billable credit amount.
any inside word on senior associate compensation?
"we will be increasing our compensation scales for associates at all levels to reflect this increase"
Atlanta to $35k!
KS is not lockstep. The firm has 4 or 5 salary bands. There is a list of criteria that associates must satisfy before advancing to the next level. Criteria vary by practice area (i.e., in litigation, you initially are expected to be able to do research, draft memos, and, later, to take a depo, etc.). In effect, advancement is discretionary.
I don't recall the exact numbers, but, for example, level 1 would correspond to a salary range of $135 - $150k (I don't recall the actual numbers - these are hypothetical examples. Also, these are before KS jumped to $160k). A first year would start at $135k. For year two, that associate could be bumped up to $150 (or somewhere in between, or not at all). Until that associate advanced to level 2, their salary would cap out at $150k.
Level 2 would correspond to something like $150k - $180. (Again, not actual numbers). So, it is possible for an associate to be pigeon holed at a particular level while other associates at the same year (or more junior) actually make more.
When the firm gets around to addressing senior associates' salaries, it's not clear how much the adjustment to salary levels will actually affect associates. E.g., a second year at Level 1 making
$150k would at least get a bump to $160k (since that's the new bottom number for level 1), but it's not clear how much, if any, they would get bumped on top of that.
Definitely not a lot of transparency.
4:48 -- very informative. Based on the numbers you threw out, I presume you are not in Atlanta. Is the same approach (with lower numbers) used in Atlanta?
4:48,
Sounds like a great way for KS to screw its associates and at the same time make it harder for them to complain about it!!!!
$145k in NC? Does this mean all the secondary markets with Biglaw (Minneapolis, Pittsburgh, etc.) will likely go that high?
8:10,
Charlotte is better paid than Atlanta. Several firms there have been paying $145k for much longer than Atlanta. Salaries there won't have a real effect on third or fourth tier markets like Minneapolis, Pittsburgh, Nashville, etc.
I see the tiers more like this:
1st - markets paying $160k or higher
2nd - markets paying $130k to $159k
3rd - markets paying $100k to $129k
4th - markets paying less than $100k
thanks, 8:34; that makes sense.
06:27 PM (both of you):
Yes, Yes and Yes.
bravo KS, i still believe the top ATL firms are going to experience an exodus of laterals if the compression problem isnt solved, but 145 in the ATL is great.
Lat, can we get a post on other places that pay a premium for IP associates?
10:09 -- it has been well over a year since the compression complaints started, and still no exodus from Atlanta. I call b.s.
How would you know if there was an exodus out of Atlanta among more senior associates? They wouldn't publish that data anywhere or advertise it. The only groups that might notice it are human resource people at larger firms and headhunters, but unless they were tracking it even they could miss it.
Now that K&S, A+B, and KS have raised 1st yrs. but are "waiting for the market to settle" with respect of midlevel and senior associates, when will the other shoe drop? In other words, when will midlevel and senior associates at these shops know what their raise will be? Will it be secretive or published?
A+B posted their whole scale, they aren't waiting for any markets to settle. They tried to set the market, and then got called out by other firms who said, "A+B is a cheap bastard firm and we aren't going to screw our associates so transparently. Instead we are going to figure out a way to be more secretive in the screwing of our associates."
Been planning to take a job in Atlanta at Powell Goldstein or Seyfarth Shaw - but now they're behind in pay. Any idea whether they will match by next summer?
Has the Kilpatrick raised made it in the Fulton Daily Reoprt?
10:13:
Don't hold your breath... PoGo an Seyfarth have allegedly indicated (expressly or implicityly) that they are not planning on raising anytime soon.
Interestingly....Seyfarth is doing their whole "focus group" thing again which is what led to their raise to 145 in April. My best guess is that they will raise by Jan 1st in all offices.
"continue to attract and retain outstanding lawyers" is ironic since so many Kilpatrick Stockton lawyers are just plain incompetent. Diane Prucino in particular only has her job out of a desire for diversity as she is among the most clueless of persons that you could ever meet.