Associate Salaries, Contract Attorneys, Document Review

McDermott to Create “Second Tier” of Associates

McDermott, Will & Emery has come up with a more creative way to deal with soaring associate salaries. The firm has announced that it will be creating a “second tier” of associates to deal solely with low-level tasks like, e.g., document review.
As Cal Law points out, hiring cheaper lawyers to do this type of work is nothing new; this type of stuff is the staple of contract attorneys in most biglaw firms these days. The new part is making these contract attorneys a lower class of associates, essentially making them “permanent contract attorneys”, as Cal Law puts it:

While some firms quietly turn to contract attorneys, or even ship grunt work overseas, McDermott, Will & Emery plans to create a new tier of attorneys — think of them as permanent contract associates — to handle lower-end tasks at lower billing rates.

First-year associates at big firms now earn $160,000. Meanwhile, electronic discovery has dramatically increased the amount of basic work that usually goes to those high-priced associates.
“This is a topic of great importance, since the cost of document review has become intolerable for everyone,” said David Balabanian, the head of Bingham McCutchen’s litigation group.
While hiring contract attorneys is nothing new, creating a second class of full-timers is.

[The Recorder via Cal Law]
Is this a good or bad thing? On the one hand, it increases the competition even more for the “real associate” positions and institutionalizes to an even greater extent the law school tier system into biglaw law firms.
On the other hand, it may be beneficial to those attorneys now doing the contract work. It will establish them as associates in the firm, even if not on the same level as the top tier associates. They will likely receive things like benefits. The top tier associates will likely do more substantive work sooner. And the clients won’t find themselves paying top tier prices for stuff like document review, as still occasionally happens.
So what do you guys think? Will other firms adopt this model? Once again, it makes sense to us.
And hey, L2L, maybe you should apply.
Firm to Fill Cheap Seats [The Recorder via Cal Law]
McDermott To Create a New Class of BigLaw Attorneys [WSJ Law Blog]

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