With apologies for the delay, here’s our promised update on the situation over at Dechert LLP.
As we mentioned last Friday, back in this post (and its multiple updates), it looked like Dechert laid off 13 lawyers in its Finance and Real Estate practice (“FRE”). Then firm chairman Barton Winokur sent out this message, late on Friday afternoon:
Due to the major shift in market conditions affecting client demands in our Finance and Real Estate practice area, we currently do not have sufficient work for all the associates in FRE. As a consequence, we have told 13 associates in the U.S. FRE group that we see no demand for them in that group in the foreseeable future. However, due to increased and substantial demand in other practice areas, we will be offering those lawyers the opportunity to work in those other groups.
We think we’ve gotten to the bottom of what happened to the Dechert 13. And we’ve picked up a few other tidbits about the situation over there.
Read more, after the jump.
We’ve gathered information from several different sources at Dechert, whose identities are known to us; this report is a compilation of what they provided. We looked to anonymous comments to our prior posts for leads, but we didn’t rely upon information in the comments unless we were able to obtain independent verification from one of our known sources. (As we mentioned in our second update to our last post, we tried to reach Barton Winokur, but he never responded to us.)
So here is what we’ve learned about what went down at Dechert last week:
1. The Dechert 13: Initially laid off, then offered two months of document review.
(a) The 13 affected lawyers were all from the firm’s Finance and Real Estate (“FRE”) practice. But prior accounts of the Dechert personnel action didn’t mention what offices the 13 lawyers worked in. We hear that three were in Philadelphia, three were in Charlotte, and the rest were scattered around New York, Boston, Hartford and San Francisco.
(b) These thirteen lawyers were set to be laid off — in the most traditional sense of the word — on Friday at lunchtime. As for the deal they were offered, according to the Legal Intelligencer, “[t]he attorneys who were originally asked to leave were offered three months severance, six months of paid medical benefits and transition placement support…”
(c) But that afternoon, it came to light that the litigation department just got an enormous document review project, which they need to throw tons of warm bodies at over the next two months. So the powers-that-be decided to offer the FRE 13 the prospect of working on document review for the next two months. So, in Winokur’s email, “the opportunity to work in those other groups” = 60 days of doc review fun.
(d) The details about the set-up are “very fuzzy.” Would associates who take this deal become full-fledged members of the litigation department, or will this be more of a staff- or contract-attorney-type arrangement? What kind of seniority will they be given? What happens to them after the doc review is over? If they’re let go after a few months, will they still be offered severance? Nobody really knows.
(e) On these questions, an unsubstantiated rumor:
[T]he firm may try to get away with revoking severance for these folks (most of whom are in their fifth year or more senior) because if they come back, work for two months in document review, then have offers to essentially start at the bottom in the litigation group, they will not really have been “laid off.” If that happens down the line, that would be a shame, and highly unfair.
(f) Minority view: A few sources claim that the 13 associates who were laid off were fired outright, with no document-review option. But this appears to be the minority view, from tipsters who might not have heard about the doc review possibility. Most of our sources mentioned the offer of doc review in lieu of firing.
Of course, the question may be a bit academic, since the document-review option doesn’t sound very appealing — or popular, even among the layoff victims. One source tells us that “it doesn’t look like any will accept this exciting offer, although I can’t 100% confirm.”
2. Junior associates in FRE / Corporate and Securities to be sucked into Giant Doc Review.
(a) Junior associates — first-years through around third- to fourth-years — in FRE, who basically have no work, are going to be stuck on a huge document review project for the next two months / 60 days. They’re being staffed on this litigation matter involuntarily, and they’re not happy about it:
“Most people I know are looking for other jobs. Cue mass exodus.”
“[T]his neither advances careers nor provides any morale boost — most attorneys came to FRE because they despise litigation, now it looks like they’ll be stuck there for at least two months. In all fairness, it is better than being laid off, but not by much.”
(b) Some good news: the junior associates from FRE who are being stuck on the Giant Doc Review are not being treated as staff or contract attorneys or otherwise having the terms and conditions of their employment changed (other than having to work on said Giant Doc Review). In other words, as a technical matter, they are still part of FRE. Word on the street is that “the firm will see where things stand after the doc review is finished.”
(c) Some bad news: This document-review corvée is apparently not limited to FRE associates. Junior associates in the corporate and securities group may be placed on the Giant Doc Review as well.
3. Continued uncertainty and instability at Dechert — Philadelphia.
(a) At a meeting in Dechert’s Philly office held on Friday at 3 p.m., at which the surviving associates were told about the layoffs, they also were informed that “work would continue to be slow,” and some people may get moved around.
(b) On that subject, junior associates in FRE and Corporate / Securities have also received lots of emails about opportunities elsewhere in the firm. For example, this email recently went around:
Junior Associate position in Employee Benefits Group–New York or Philadelphia
Employee Benefits has an opening for a junior associate (1st – 2nd year) in either the New York or Philadelphia offices. They have asked us to check internally if anyone from our group would like to be considered for this opportunity or can recommend someone for this position. If so, please send resumes to the EB Practice Group Manager….
So that’s the Dechert situation, as best as we can piece it together. If we’ve gotten anything wrong, or if you have some new information to add, please email us. The safest way to do that is from a non-work email account, using the web browser on your Blackberry or other wireless device — or, of course, from your home computer, sometime tonight. Thanks.
Dechert Gives 13 Associates Layoff Notices [Legal Intelligencer]
You’re Fired! . . . Wait, No, Sorry, Just Move Practice Groups [WSJ Law Blog]
Earlier: Nationwide Layoff Watch: Dechert Decks A Baker’s Dozen?