Nationwide Layoff Watch: Thelen Reid Brown Raysman & Steiner
The rumor making the rounds of lawyer and staff layoffs at Thelen Reid Brown Raysman & Steiner is true. We just spoke to Thelen's co-chair, Stephen V. O'Neal, who provided confirmation and details.
The firm is in the process of laying off 26 associates and 85 staff members, on a firm-wide basis, "in response to recessionary pressures." (Unlike President Bush, Mr. O'Neal was not afraid to use the "r" word.) Thelen has approximately 600 lawyers, per its website, so the cuts amount to roughly 4 percent of total headcount.
With respect to the location of the affected lawyers, the cuts affected all major offices. With respect to seniority -- one source told us that some first- and second-year associates were fired -- Mr. O'Neal said that "some were fairly junior, and some more senior."
In terms of practice areas, Mr. O'Neal said the layoffs were spread out among groups, but with "some areas more impacted than others," including certain parts of capital markets and cap-markets-related real estate work. He noted that other practice areas are "thriving and increasing in scope," including renewable energy, cross-border M&A, China practice, litigation, and workouts / bankruptcy.
With respect to staff layoffs, Mr. O'Neal explained that they are due in part to the economic climate, but in part due to post-merger staff redundancies. The merger of Thelen Reid and Brown Raysman took place in late 2006, making the consolidated firm a little over a year old. But the firm did not do much cutting of staff in 2007.
Last year "was not a year when we tried to make deep cutbacks in anything, even though we had combined two good-sized firms," explained Mr. O'Neal. "It was a year of building, coordinating, and consolidating. We wanted to understand how best to organize this new entity." Now that the firm has a better understanding of its staffing needs, and is in the process of consolidating multiple offices in the same cities (e.g., New York), it is reducing staff redundancies.
As for associate severance packages, Mr. O'Neal stated that firm provided a "market-level" package. We floated three to four months as our understanding of market, and he said that the firm is "in that ballpark."
"We are anticipating a profitable 2008," said Mr. O'Neal. "We are being prudent businesspeople, and when you are dealing with recessionary pressures, you adjust your business so you will have -- and maintain -- a strong level of profitability, notwithstanding those pressures."
We thank the firm for the information and candor with respect to the layoffs (i.e., not casting these departures as "performance-based"). If you have more information, feel free to email us.
Updates: A few additional nuggets:
1. As noted in the comments, total headcount includes partners and counsel, so the percentage of associates laid off is higher than 4 percent. Some of you suggest it's around 10 percent.2. We're a little annoyed at Legal Pad for the lack of an ATL shout-out -- in both the blogosphere and the MSM, it's proper form to credit and/or link to the source that breaks a story first (even if you were working on the same story too) -- but we'll link to them anyway.
They have more on the Thelen layoffs here. Much of the info in their post appeared previously in ours, but they do add that the firm "is also trimming its summer program from eleven to eight weeks and is pushing the start date for first-years from September to January."
3. A source at the firm tells us that the severance packages were in the two- to three-month range.
Earlier: Prior ATL coverage of layoffs (scroll down)
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sucks - that's a lot of people.
Bout time
Bout time...first
Have to give credit to the firm for professionally explaining its reasons to make cuts but it is probably not much solace for the staff and associates looking for jobs.
Laying off first- and second-year associates? What a crappy place! Good luck recruiting.
They have 234 associates on their website right now. They canned over 10%. Nice.
Agreed with 6:06. Such is life. Good for them for being professional about it.
what goes around comes around.
This is what happens when you pay people fresh out of law school with no real lawyering skills 160K- the moment a downturn hits you need to cut them loose... The big salaries require constant production at an exceedingly high volume and can't be sustained for long. You can only bill so much on the menial non-substantive paper shuffling low level associates do..
"what goes around comes around.
Posted by: Anonymous | March 19, 2008 06:24 PM "
What does that mean? Some good people were let go today. This is not a happy day here.
Did they get any severance? Permission to use the office to look for new work?
most of thelen jumped ship to winston over a year ago.
Sinking Ship?
If you are still at Thelen, you better dust off your resume. That place is going to be gone within a year. Partners are leaving left and right (both by force and by choice). Today's layoffs are only a temporary stopgap to delay the inevitable disbandment of the firm.
I love when the posts on this site are all calling for "blood in the water" or "sinking ships." When coupled with the persistent calls for "NYC to 190," its clear why people hate lawyers. If you're a headhunter making these posts, you are one step above a telemarketer (only because your job title sounds cooler). If you're an attorney for another law firm, shame on you for your schadenfraude. I'm very sympathetic to those at Thelen who lost their jobs.
NY to 190!
NY to 1 million!
"We anticipate a profitable 2008" - me too, if I cut my operating costs by say over 2.5 million in a matter of minutes and keep my profits the same.
Shame on Thelen! No doubt some of those associates turned down other offers on the basis the money was good at Thelen - A pox upon Thelen's house.
Can anyone confirm where the layoffs occurred? NY? LA? SF?
What's a Thelen?
7:44
A Thelen is a pedantic person who makes grammar related posts.
glad i didn't get a call-back from them...
If you couldn't get a callback from Thelen, you likely have bigger problems. It's not the most selective place.
I completely agree. I've showed several, non-lawyer friends posts on this site, and they've been disgusted by the general greed for higher bonuses and salaries, when we're already very well-compensated. The pettiness and raw ego needs of our profession are both alarming and pathetic.
NY to 200 thousand! Cadwalader to 200 attorneys!
To inevitable mr partner:
Why dont u do the menial work yourself then...how about this idea....spend less on dinners and summer programs, give younger associates real work...make the law firm industry more efficient , change the fee structure...o thats right why change the law firm into an efficient corporation instead cut people who have huge loans to pay off...get real
As more large firms layoff associates, other firms are going to be comfortable laying off also.
This may be the calm before the storm.
Instead of competing in raising associate salaries they are going to compete to see who can layoff the most associates in the harshest way possible.
Shudder.
LOL at these megafirms.
What!? Expecting a "profitable 2008"...yet it cuts 10% of its associates...including first and second years!!!???
If I were a young partner (or senior associate about to become partner), I would have serious misgivings about the firm's handling of things.
This MUST NOT be forgotten - - - top students at good schools and all students at top schools must shun Thelen.
NOTE TO ALL career services deans: this is a perfect time to earn your keep (i.e., beyond organizing OCI's and inviting students with grades below your school's cut-offs to come into the office to utilize your "resources" to find a crappy job). Any decent school's career office should henceforth be maintaing a List of Shame of all firms that have laid off associates, with specifics as to numbers, practice areas, class years, etc.
So far, it's been mostly marginal (at least nationally/internationally speaking; Dechert and EA are plenty major and prestigious in Philly and Boston, respectively) firms that have blatantly kicked associates to the curb. But people need to stop being so damn understanding of this shortsighted, greedy approach to managing law firms (lest the trend spread). If a firm is really feeling the economic downturn or credit crunch - such that it needs to trim a few million dollars in expenses - the proper course of action should be to lower partnership profits by a few million instead. Granted, partners shouldn't be thirlled about the prospect of earning $50-150k less this (and/or next) year, but by taking the high road they could proudly announce that THEY DIDN'T and THEY DON'T lay off associates when the going got/gets rough. Such an approach would shore up more "prestige" and morale than countless worthless gifts, lunches and surveys.
GC's: don't send any work to firms that are laying off associates - unless the firms show you that they have first taken steps to reduce partnership profits to the greatest extent possible.
P.S. Please, spare me the claim that firms need to boost, not reduce, PPP's, in order to attract rain=making new partners to join the firm. Any partner who has a big portable book or shows real promise of future rain should be able to avoid the type of firm that lays off associates.
P.S. II: Spare me the commentary as to "that's what happens when you pay kids $160k who can't do anything." Associates cover their comp, benefits and share of overhead in about eight months (of typical billing). That means associates at TR - all of whom were easily on track to surpass 2000 - more than paid for themselves by August 07', when this whole mess really hit hard. Does it not stand to reason that they would also pay their way (salary, benefits AND overheard) over the course of this entire year?
LOL at Seattle "biglaw."
9:32,
Luckily, top students at good schools already follow your advice and shun Thelen.
932=nutjob
Hey Profits, let's not go overboard here. Layoffs are bad but compare the plight of lawyers to the slaughter that's going on (and will accelerate) in wall st. We have it good.
936=managing partner at firm that has laid off, or is considering laying off, associaties.
932=someone clearly still in law school
9:32 sounds like a bitter betty to me
the blog legal pad is reporting that Thelen Reid is also cutting its summer associate program form 11 to 8 weeks and pushing the start date for first years from september to january. Any other firms pushing start dates already?
When will Wachtell, Cravath, and S&C announce they're firing associates?
Looks like Thelen only has 550 attorneys
http://www.thelen.com/index.cfm?section=Attorney&function=Search&showResults=1&browse=1
If you count all of the rows, I don't think it's even 550.
Can anyone back up what 9:49 is saying regarding the length of summer program and the first year start date? What's the real inside scoop here?
Thelen has 630 attorneys, so it didn't cut 10% of its attorneys. It's actually around 4%. It didn't affect DC. My guess is that it affected the NY offices the most as there are two offices in NY that are being consolidated into one after the merger of Thelen Reid and Brown Raysman in Dec. 2006. No word on whether Thelen cut 1st and 2nd year associates.
9:55, it's being reported on callaw dot com (part of the law dot com site) now. the article also says that at least one associate was cut from each office.
9:55
Its true, they are cutting three weeks off the start of the summer program and starting first years in January...at least January.
9:54 and 9:56, if you do a search for 'associates' only on their site, there are only 234. so it looks like it's 26/234.
10:11, Nalpdirectory.com says it has between 501-700. I just got 550 on their website. So it looks like it's around 5%.
Why would they start first years in January? That just decreases their morale and makes them feel inferior to first years at comparable firms starting in September. It also doesn't actually save the firm much in the scheme of things. Sure they save a few thousand bucks, but everyone has to start some time...this just puts the new associates one step behind. The classy thing to do would be for the partners to take the hit and start the first years off on the right foot.
"The classy thing to do would be for the partners to take the hit."
If they were classy, they wouldn't be partners.
If they were classy, they wouldn't be partners? Are you inferring that all partners have no class? That doesn't make sense at all. I agree with 10:19. Just suck it up and start 'em in September.
He's implying partners have no class. You're inferring it. Moron.
Wow, 10:38. That's mean. You lack class. And that's not inferred OR implied. It's OBVIOUS.
yeah - January start - wtf is that? - start em in sept., suck it up and fire one or two if that's what you need to do
Actually W&H, infer=to derive as a conclusion from facts or premises. So 10:19 wasn't incorrect, but imply works too!
But back to Thelen, what's the real benefit in cutting the summer program and starting the first years later on? It doesn't seem to save them as much as it potentially costs them.
Actually, what I said is a direct (abet conditional) statement that all partners have no class (though obviously not that all those without class are partners).
There's no inference or implication involved.
9:32 - What planet are you from?
Urging GCs so give a shit about associates is like asking banks to have sympathy for Jesse James. GCs have been at the vanguard of trying to halt associate pay increases and demanding more productivity from them. GCs want quality work product and they know junior associates are not the key elements of law firms. If anything, they want partners they work with to be well compensated to lend stability.
Rainmakers don't give a rat's ass about avoiding "the type of firm that lays off associates." If anything, they gravitate to that kind of firm because they know the firm will do whatever it takes to keep partner profits up.
Discussing associate profitability without considering that they don't have any work to do is too moronic to deserve a response.
You should really consider staying in school until you learn something. Posting idiocy on this blog wastes everyone's time and accomplishes nothing. The intellectual level of this blog is not particularly high, but most of the posters seem like Einstein compared to you.
10:25, it's again obvious that you have no class. And again, no inference or implication needed. Get out of your office and go for a little walk, it might help.
CWT laying off but not announcing.
Why do lawyers act like Frenchmen whenever law firms layoff associates? Ibanks, mine included, are laying off hundreds without batting an eye and you complain that a couple dozen attorneys get the axe?
Also, judging by many of the comments on this board, it's clear that the overwhelming majority of you do not give a crap about your peers. Considering how you all refer to your fellow law students and lawyers as "TTT" all day long, I'm fairly certain that if any of you had the power you would layoff A LOT more associates than these firms do.
You can call these law firms despicable but you people aren't much better.
Stop being so weak-minded and suck it up. The economy is in a bad spot and layoffs are inevitable. These law firms may not give a shit about their associates but you people don't give a shit about your fellow lawyers either.
New associates aren't profitable until they learn how to practice. Pushing their start date back 4 months won't help them learn what they need to know any sooner.
10:56, you're missing the one quasi-intelligent point 9:32 made: the effect this will have on recruiting.
Probably not an issue for Thelen, given that they can't tie their billing rates to the pedigree of their lawyers as they're not selective. But remember what happened to Shearman after the '01 layoffs--very few people with the means (school, grades, or both) to go elsewhere anywhere in the same league treated it like it was radioactive. And from what I saw at my LS (NYU), the ding SS took to reputation still hasn't been buffed out.
10:59, relax; I hardly agree with the literal truth of my own hyperbolic statement. I can't think of any partners at my firm (within my own practice area) that are totally without class; most are, in fact, pretty neat people.
However, in the narrow context of partners generally treating those in the associate ranks like FBUs, my statement holds true.
Can anyone on this board give a good reason for what might happen (if the rumors are true) to the summer associates and first-year associates? It's clearly not as nearly bad as getting laid off, but I also don't see an obvious benefit to the firm in cutting the summer program by 3 weeks and starting the new associates in January.
11:14: cutting the length of summer camp makes a fair amount of sense, I think. They cost the same as 1st yrs, but essentially do nothing and what they do firms frequently can't charge to clients (there are probably exceptions at firms like Wachtell, Cravath, S&C, etc.) because they take a day to produce pure crap. Moreover, most will be coming back to the firm if they get an offer--so it saves money with little down-side. The summers might grumble some, but this way they all get a job (or are at least more likely to do so--if they ding 20% of the summer class after cutting into their summer earnings, eh).
Here's the WORST PART. When you summer at Thelen, they explain that they don't pay market, but rather a "pay range" depending on performance, because that allows them to not overpay associates and thus avoid layoffs when other firms would have to take such measures. In sum they assure you that in exchnage for taking less money, your job is more secure.
RIDICULOUS. Lost MAJOR respect for the firm.
Fact is, this recession is going to be longer and deeper than the last one and all but the top tier firms will be forced to retrench somewhat. I wonder if this is what STB had in mind when they raised to 160: make followers who aren't in their league pay through the nose and then ruin their own reputations for top-tier recruiting purposes. That's devious, that's brilliant, that's BigLaw.
Hey Employed IBanker / 11:01
Go to graduate school
11:18: Those are good points about summer camp. But what about pushing back the first year associate start to January?? That doesn't seem as easy to rationalize.
CWT has laid off a lot more than just the 35, but not announcing
If what 11:22 says is correct, that's pretty bad.
11:26, I agree that moving first years back to January doesn't make the sort of simple economic sense that summer camp to fewer weeks does.
But if you want to wait and see how much worse this could get before you start recinding offers... then it makes more sense.
CWT to chapter 11
The DC office didn't lose any attorneys, they lost staff. All were women, most were minorities. One secretary had been with the firm for 15 years. FIFTEEN. They gave her 20 minutes to gather her things and then she was escorted out of the building. She was the first of many.
This was so much more than six-figure attorneys losing their jobs, it's about the loyal staff that had nothing to do with the firm's poor management and the ill-advised merger. While attorneys take their experience earned at one firm and jump to another on a regular basis, staff weather the years at one place thinking that their hard work is worth something, even if the firm can't bill for their time. They were the ones to pay for the greed of others.
A little known item: NY is looking to boost revenue by sub-leasing off parts of the DC office. They did it last year on a largely unused floor. This year they're getting bold: next month 4 senior partners on one of the busiest floors are among those who will be losing their offices so that their prime window offices can be leased out to an outside company. Altogether, 6 offices and two secretarial bays were thrown to the wolves.
Bit by bit, person by person, the firm is disappearing.
It'll be interesting to follow up with this one and see what Thelen actually ends up doing and if some other firms follow suit. 11:34, thanks for your insight. Also, I'm not sure 11:22 is precisely correct on the pay at Thelen. That may be worth looking into also.
11:22 is correct.
The rationale for pushing back first years to January is that they don't have to pay them for not working. In a normal year, billing doesn't count for first years until January and they are given a pass if they don't bill much because they have no work. They are taking away the three month free pass.
People expect layoffs at CWT. They laid off their managing partner. I assume he failed to meet his 3000 billable hour requirement. There must be a team of illuminati running that place that hires/fires as needed to maximize their profits.
As far as Thelen goes, recruiting is probably the least of their concerns right now. I would guess that the partnership is more worried about staying in business at all.
Sounds like we may start to see a NYC pay disparity again.
Not "NYC to 190k," but "Everywhere Else to Paycuts before layoffs!"
Everyone below the V-10 is screwed.
Maybe it's the optimist in me, but I think (perhaps against reason) that Thelen will be just fine. Hopefully they took the necessary drastic steps now so that they'll be out of the dark when other firms are forced to do the same thing later on. BigLaw is all about taking risks.
Oh yeah, 11:54, they took a big step to fix everything.
Just like the Fed, about 6 rate cuts ago.
11:55, there must be some rhyme and reason to the numbers here. Firing 26 associates and 85 staff members is a lot of people and a lot of money. Seems that Thelen is banking on not having to go through this again. One and out. We'll see what happens. The economy isn't getting any better.
9:32 and his ilk seem to be oblivious to the obvious fact that job protectionist policies have been disastrous for all economies that have tried them.
When you make it too hard for any business to fire people, they would simply scale down on hiring in the first place and use some temps. Or not expand at all.
If you want permanently high unemployment, make sure to shame firms so that they never hire more than absolutely necessary.
11:53, everyone below the "Vault 10" is certainly not screwed. People look at the Vault rankings and honestly believe they show where firms stand. You need to focus on PPP and revenue per lawyer - there are some solid firms in the Vault 30-60 range that are on par in that regard with some of the more "prestigious" firms. Any firm that is competitive in the PPP and RPL categories should be able to weather the storm (ie ranked in the top 25-30 overall).
1:00 - amen. Funny how Cadwalader, O'Melveny, Jones Day, etc. are laying off associates / paying bonuses below market, while some of the Vault 30-60s seem just fine.
go get rich thelen partners/hope ur business dries up and karma bites you in the ass
The legal lad site say at least one associate was laid off in each of the offices, but I have a friend in their San Jose office, and they said they haven't heard any associate (they only have 12 associates) being laid off there.
in fact they just had a lateral hire start in january.
Lat, can you do an item about layoffs in ibanking? I've heard the cuts have been very deep.
Anyone who is familiar with this firm's situation should not be surprised. Back in 2006 (or was it 2005?), the American Lawyer did a story about the fact that this firm was bleeding partners and associates even as it increased its profitability. My guess is that the firm continued to struggle throughout 2007 but was kept afloat by the relatively good market conditions through early to mid 2007. However, once things hit hard this year, it proved too much and they finally had to resort to cutting people.
I sincerely feel bad for the folks here. They have a lot of good people who work at this firm. I really do hope that their associates will either a) find new positions quickly or b) perhaps use this as an opportunity to pursue other avenues that they would not have pursued otherwise.
As far as everyone else, don't get too high on the Schadenfreude. Sure, there are firms out there who are better managed that some and can weather tough storms better. But if things get bad enough, this could be any of us.
Here's the article about Thelen's problems back in 2006 that I was talking about:
http://www.law.com/jsp/article.jsp?id=1146647127028&rss=newswire
1:00 and 1:06: Not quite. The firms that do well on a PPP basis may be extremely leveraged. This means they make $$$ in upmarkets but are even more exposed to downturns like now. The V10 firms have lots of value invested in reputation. They are therefore less likely (particularly after the Shearman fiasco last down market) to layoff associates. They are also less exposed to the market since they tend to turn down more work than they can do. The line isn't drawn at V10, but as a measure of reputation, the idea still holds.
9:32pm Profits
Please keep in mind partners don't owe associates anythings. Partner have every right to shed associates if they want to or if they need to. The partners are running a business. See Jack Welch, "Winning" (Harper Collins, 2005) (10% of bottom performers should be cut)
On Summer recruiting.
When I was a summer, the partner in charge of the summer program essentially said that it would make more economic sence to to just give each summer a low end Mercedes since thats what the budget amounted to for each summer associate.
8:26: law students don't owe partners a thing, either. For Thelen, which will never draw from the top of the pool, firings don't matter.
But how many of the V10 or V20 do you think want to be the next Shearman?
On a different note, partners aren't running a business; a law firm is an organization of professionals, which is supposed to mean something beyond the bank/corporation model.
Thelen recruiting = dead.
You can lay off some mid-level associates, axe a partner or two, but to treat incoming associates and summers this way is completely unacceptable. How can any of them feel confident that things will be better in Jan. 2009? What law student in his/her right mind would accept an offer from this firm at the end of this summer? Or the next?
This recession ain't going anywhere anytime soon. And, unfortunately, Thelen's actions are going to be replicated at a lot of other shops--especially in the smaller markets. Every poorly-leveraged law firm trying to keep up with the Jones' through salary hikes should be ashamed of themselves. No doubt that every Thelen hire would gladly trade last year's salary hike for a little job security--and a competent management team.
If last year's hires have to start in january what do they do about their loans...the banks come a calling in november...feel bad for them...also, some summers gave up offers for thelen...how can that be ok? who runs a business like that?
Shearman still sucks.
What departments laid off at Thelan? A lot of more conservative firms have been looking for strategic hires - now may be the time to do some poaching ...
Did someone just cite Jack Welch?
11:49, in addition to saving money for not paying people and not looking bad when you don't give incoming first years a bonus for working only three months, you also encourage some people to leave and work elsewhere, depending on their financial situation.
If you're graduating law school, you've got expenses, mainly rent, and if you're already committed to a NYC apartment, then you're forking out 3 extra months with no income. For some, it might make a difference and they will look for another job. Looks better than firing MORE first years.
When Thelen was Thelen Marrin Johnson & Bridges, they nearly died when Kaiser Industries went belly up in the early 1990s. They survived, and did well as a second-tier firm for a lot of years after that, but the shellshock from that made them quick to cut folks thereafter. O'Neal, IIRC, has been around Thelen since the TMJ&B days and knows what can happen to a firm if it tries to ride it out.
Now, this sucks of course for the associates involved, this is a move consistent with their culture.
When Thelen was Thelen Marrin Johnson & Bridges, they nearly died when Kaiser Industries went belly up in the early 1990s. They survived, and did well as a second-tier firm for a lot of years after that, but the shellshock from that made them quick to cut folks thereafter. O'Neal, IIRC, has been around Thelen since the TMJ&B days and knows what can happen to a firm if it tries to ride it out.
Now, this sucks of course for the associates involved, this is a move consistent with their culture.
11:01/Employed Ibanker:
Well said.
Hmmm. I guess I shouldn't hold my breath while I'm waiting for Thelen to respond to my application.
If Thelen starts first years in January AND doesn't give them any sort of reformulated market bonus, they're going to completely ruin their reputation with students and really hurt their future recruiting. If this is true, they should rethink it. Students are watching.
Not all biglaw firms are in such a bad state. We have a ton of work to do in my dept at my firm. How do you like that, suckers?
Lat, you're wrong that Legal Pad should have credited you if they were working on the story at the same time. It's only if they learned of the story from you. If you're going to try your hand at real reporting, you should know the rules.
I agree with 8:26. We as lawyers often forget that law firms are businesses and that firing people often makes good business sense. They say that a company should get rid of the bottom 10% of its performers every year. Law firms don't do that because lawyers tend to see their jobs as somewhat recession proof and stable. Truth is, it would probably increase the standards of our profession if there were more layoffs, as well as increase the quality of a law firm's work.
And to 11:53, that's just an ignorant comment. Being V10 doesn't mean that you can afford to pay your associates more money. The better indicators for that are profits per partner, revenue per lawyer, etc.
hey 10:44 hope u lose ur job
Junior associates at most firms are easily replaceable with much cheaper staff attorneys, contract attorneys, law clerks, paralegals, and paralegals with law degrees. Why pay 160k when you can pay someone less to do the same work and then lateral in midlevel talent that some other firm paid for. Not sustainable if everyone does it obviously, but when you make the pay difference between first year associates who know nothing and "fifth year" staff attorneys so broad and make it that much cheaper to hire the later, it makes more financial sense, ie. partner profit sense, to go with the staff attorney. Many tasks junior associates do (document review, legal research, put together binders, make timelines of facts, etc) can be done for much cheaper by experienced staff attorneys, contract attorneys, law clerks, and paralegals. Because of the focus on partner profit, as opposed to professional development and partnership training, the 160k pay raise may make some firms choose the cheaper route rather than hire as many new associates. It won't happen to the Wachtells of the law firm world, but even V10-50 firms fill their ranks now with staff attorneys, as well as contract attorneys, with jobs once done by junior associates even a couple years ago.
If Thelen starts first years in January AND doesn't give them any sort of reformulated market bonus, they're going to completely ruin their reputation with students and really hurt their future recruiting. If this is true, they should rethink it. Students are watching.
You folks need to stop drinking the kool aid- Nobody cares that a bunch of inexperienced students are watching. We can replace you with real lawyers at less cost- The buble you people live in is astonishing- you are all in dire need of a firm reality check.
Since it's probably inevitable that firms of a variety of rankings will undergo layoffs, this is actually GREAT news, at least for 3Ls starting in the fall because so long as your firm is ranked above Thelen, it won't want to flat out rescind 3L offers because "even Thelen" only pushed back start dates...it sucks, but maybe other firms will be more hesitant since for now the bar is set at later start dates rather than offer rescission.
Hey mr. partner if you werent worried about law students watching u would have posted ur name...are you even experienced in reality?
I agree with 10:40. Firms need new associates. Thelen shouldn’t squander its reputation among students because it’s harmful for the firm as a whole to some extent. If all firms took your point of view, 11:04, we’d all be out of jobs. Everyone starts from scratch at some point. If you don’t have any first years, you never have any second or third years and so on. Thelen should be trying to increase happiness and morale instead of disenchanting incoming first years. It’s not an impossible task.
Lat:
Do an update on Greenberg Traurig. Have they started paying equity partner draws again? That place is a bomb waiting to explode.
yeah, with firms keeping discussions relating to layoffs/trims tightly under wraps, i agree that it's good to know now what will likely happen among other law firms. Sure, some might actually rescind offers, but if the trend is going to be 'pushed back' start dates, I'd rather have a job that starts later than no job whatsoever.
Hey mr. partner if you werent worried about law students watching u would have posted ur name...are you even experienced in reality?
On what basis do you support the claim that my lack of concern about what whinny inexperienced hacks are thinking is somehow related to my seperate and distinct concern of remaining annonymous which concern should be self-evident- Again you suck- 1st years to 50K and a stern ass kicking!
Mr. Partner kant speel
just saying...
Mr Partner how about u list ur name so i know ur firm and we will see what happens to yourt summer classes, first and second years...
layoffs will continue, secret or not. summer classes will not be completely offered, next summer class will be even smaller. Biglaw is dependent on the financial markets - less bankers and deals less attorneys necessary - and while litigation may go up its NOT enough to actually make up the difference. Markets are acting wonky and it will be awhile before they stabilize - who knows when. All I see I short term drive ups for short term gains to watch it plummet back down again. Its dumb for firms to hold on to bloated staff. Law firms are not a charity. Last time I checked law students weren't donating their time free of charge to these places - BIGLAW doesnt have to pay you exorbitant salaries while you sit and do nothing. You people are clueless. Everyone knows there is no loyalty in BIGLAW just money and it goes both ways. Im tired of sanctomonius folks talking about looking after deadweight just because. These are the same people who would likely refuse to do probono because they arent paid for their time so why do it.
one more thing this whole reputation thing among law students means bupkiss - only a few elite firms have a chance with top students after that I guarantee you NO firm will have a problem recruiting - law students are desparate folks - sure some firms may not get the most prestigious folks but in the end - NO FIRM will have difficulty filling spaces.
Just wait for a few firms to announce across the board 10% pay cuts in lieu of layoffs. They will be considered the heros and all will follow. NY to $144K.
Can we get a list of shame up in here?
I've never heard of this firm, but we should warn future generations.
11:35, my firm spends close to $50k per head recruiting.
I think you are a little of the mark. Recruiting is one of the most important elements of a successful law firm.
Law students outside the top 10 law schools are so aren't picky and probably don't need to be recruited by biglaw at 50k per head. Laterals are another story.
V10 trolls are hilarious. If you work in a massive, highly leveraged corporate department whose biggest clients have hit the skids, this affects you. Just because the firm is well diversified to handle a downturn (meaning keep up PPP) doesn't mean they're going to keep all 300 of their transactional associates. It's about the value of you and your group, not your firm's overall prestige.
Stuff like this never happens at Heller.
10:44 - The rule you describe applies in the blogosphere for opinion / commentary. E.g., you link to the source where you happened to learn of something.
For reported news with original reporting, you generally credit the source that broke it first (even if you were working on something or had heard something similar).
E.g., New York Times crediting Washington Post on the Walter Reed story.
10:21, I totally agree. Having no paycheck when those first loan statements arrive is going to suck. And the summers are going to have what, the remains of 7k after taxes less to pay their 3l tuition/living expenses with . . . This can't be good for recruiting. Hopefully, they'll five them all offers anyway, realizing that many of the summers will probably elect to go elsewhere. . .
11:20, it's separate, not seperate.
11:35, it's desperate, not desparate.
Funny- the point remains though
12:35pm
Come back to this board after you have taken and passed the Bar Exam.
I agree with 11:10. It'll be interesting to see which other firms follow suit. A January start date beats a lay off.
Partners to run-on sentences!
Thelen? Recruiting? If you know who Thelen is (TTT) then you are scrambling for a job and will take whatever you can get any year--you will not care (nor even know/remember) about delayed start or layoffs, in a down year.
12:33: You can defer loans if you are not making money.
Mr. Partner,
While I agree with your general thesis about the ability of law firms to utilize cheaper cogs than associates to get work done, your argument is shortsighted.
It is akin to those people who get pissed off about maternity leave. Sure, there is a short term loss to company's who pay people while they are not working. However, there is the issue of population renewal that needs to be considered (and if you don't think that is an issue, speak to the Russians and the issue that they face with a diminishing population).
Back to the point about associates vs. staff attorneys - staff attorneys are not manufactured, especially senior ones. Many of them (the better ones) are former associates who have transistioned out.
In addition, solid senior associates are not manufactured; they are nurtured/grown. Maybe they have come from another firm, but there is a collective need by all firms to grow associates. That means that you might have to deal with a less efficient 4th year in order to get a top notch 7th year.
At a certain point, staff attornys just don't cut it, whether it is at a senior level, or even higher. Considering that is the case, it is clear that there is a need for associates of all levels, so that there can be senior associates.
If you have few mid-levels you will have elevated recruiting costs for seniors, lack of continuity in your firm, you will probably find a few bad apples in your recruiting group of seniors because you lack good information on their skills and those costs may just offset your gains by using staff attorneys.
In short, when considering hiring needs, it is important to avoid being penny wise and pound foolish. There are short-term costs and long-term costs. Both of these need to be balanced.
I am not sure that your argument does a great job of representing that balance and errs on the side of being penny-wise.
I do have to agree that there really are VERY few law school students that have the market power that they think they do. When you have 150K+ in loans, your negotiating position is somewhat marginalized. You need a job...preferably a very high paying one. Layoffs might hurt a firm once the market goes up...but if the market is down and stays down a little while (which may be the case here)...I think that layoffs won't matter.
At the end of the day, as the saying goes, beggers can't be choosers.
Supply and demand govern here.
1) If supply of jobs is small and demand is high (current scenario) then the firms can get away with a lot of stuff.
2) If there are too few associates, then the seniors that stick around that are profitable and worthwhile will have more leverage in their negotiations too. This can cost the firms more money too in the long run.
Thank you Mr. Keynesian.
Someone has to watch your bottom line Mr. Partner and how you manage your company.
Remember, you have a JD, not an MBA or Ph.D. in economics.
Mr. Partner = HIGHlarious!
12:14, I would be very surprised if V10 firms laid off anyone. They don't really need to and they can weather the storm and hold on to less profitable associates until the tide turns again. That's what prestige buys. I've never heard of associate layoffs from V10 other than for performance reasons.
how are those pepople going bto be paid till then?
i agree that top shops won't lay off people for economic reasons. only S&S did so during the dot com bust, right?
and to those who say juniors are useless, well that's built into the model--junior's become mid-levels and seniors. you can't survive on just hiring laterals (which by the way cost $40k just to pay the headhunter).
1:29: that's the point... they don't.
1:19: PULL YOUR HEAD OUT -- SHEARMAN STERLING WAS V10 WHEN THEY LAID PEOPLE OFF--SKADDEN LAID TONS OF PEOPLE OFF IN 80s--WHEN THEY WERE KNOWN AS TOP 5 FIRM. YOU HAVE NO IDEA WHAT YOU ARE TALKING ABOUT AND THAT IS THE USUAL COMMENT ON THIS BOARD. THELEN LAYING PEOPLE OFF IS ACTUALLY SHOWING THEIR PRESTIGE AND BUSINESS ACUMEN!!!
Um, 1:37, you are clueless. You can hire a mid-level (3rd year) trained and experienced for $40,000, that wants to be at a firm. Or you can raise up your own associate for (170,000 per year/average) plus training -- with no idea if they want to go pro bono, or have babies....
Christ, talk about screwing the 1st yrs even before logging 1 billable!
Ah yes, the economic invincibility of Vault 10 firms. Wilson Sonsini used to be in the V10, and Shearman Sterling. They fired people just like everyone else.
WSGR WAS NEVER IN THE V10!!!!
WSGR is number one?!?!
Possible scenario for the first year associates is what happened in the fall of 2001 at lots of big compani