Nationwide Layoff Watch: Correcting the Record on Simpson Thacher
Earlier today, the New York outpost of TheLawyer.com, a British publication, reported on personnel reductions at Simpson Thacher & Bartlett. The report was of keen interest to us because we've been hearing rumors -- generally vague and unsubstantiated, but persistent -- of "stealth layoffs" at STB.
The folks over at The Lawyer seem to be hearing similar gossip, some of which appears in their report:
[Simpson Thacher ] has taken the unusual step of introducing a mid-year performance review for its associates. It is understood that the benchmark for associates to reach in order to keep their jobs is significantly higher than in previous appraisals.Market sources have suggested that up to 30 associates have been asked to consider their positions as a result of the review. Simpson Thacher chairman Pete Ruegger denied the firm was making credit crunch-related layoffs.
This report appears to be erroneous, at least in a few respects. We spoke with Simpson partner James D. Cross, co-chair of the firm's Personnel Committee, who described it as "wildly inaccurate":
It's business as usual here as far as reviews. We have not changed our standards, and we have not changed our process. We've always had a midyear review process. I don't know where someone came up with the number of 30 [affected associates].
A second STB source echoed Cross's statement, telling us that "no new mid-year process was introduced." The firm has long conducted midyear reviews for (1) first-year associates and (2) more senior lawyers who received negative annual reviews. According to this source, "if a more senior lawyer gets a negative annual review, that person will often be slated for a midyear review so that progress can be checked after six months, not just annually, and so that the firm makes sure it is doing all it can in terms of additional training and mentoring."
Additional discussion, after the jump.
More about the review process, from a third Simpson source:
TheLawyer.com article is totally false in saying we have new mid-year reviews that we did not have before.[W]e have been pretty frank with people that we are trying to bring more substance to the review process, and some people here may be wrongly interpreting that as stealth layoffs. The only people advised to start to look for another job are ones with way below average performance reviews, not even close calls. The truth is not as exciting as the rumors, but not much we can do about that....
What counts as a "below average" review? Some Simpson tipsters claim that review standards have ratcheted up a bit lately. The item in The Lawyer quotes a Simpson "insider" as follows:
"What we're doing is being harder in our performance review process. People who are viewed as not performing have been given the opportunity to find another job."The insider added that, while Simpson Thacher's core practices were "still active", its 2008 revenue is expected to be noticeably down on 2007's.
"There's a definite slowdown," the insider said. "We will not make layoffs. We feel we'd rather take the hit during a downturn than get rid of people because there isn't enough work to do."
This is similar to what an ATL tipster told us (perhaps we have the same source as The Lawyer):
It is true that in the absolute boom times you carry associates that are not very good and have no partnership potential because you need the bodies. In the non-boom times, we are being more candid with people in the review process. But there is no directive to cut numbers, and no target exists. It is just doing what frankly should have been done during the boom times as well.I think what the peer firms all have to deal with is having more people than needed at the same time that attrition falls way off in a down economy. We have more lawyers than one year ago or than are needed, but we are fine with where we are and where we are going, and we would rather make a little less than lay people off.
The foregoing is basically consistent with the analysis of Matt Byrne, over at The Lawyer:
If Simpson Thacher, as it appears, is adamant that the lawyer reductions it is making are all performance-based, it is an admission that during the boom time it lowered its recruiting standards in order to staff deals. (Sorry Simpson Thacher, but you can't have it both ways.)
According to Byrne, 2008 will probably still be a very good year for STB, even if not as good as 2007:
Simpson Thacher is anticipating its 2008 financial results will be significantly below those seen last year, when revenue hit $966m (£483m) and partners took home around $2.87m (£1.43m). Sources suggest this year's figures will look a lot more like the firm's results in 2006. Hardly a calamity, but requires action.
One rumor making the rounds is that 25 to 30 Simpson lawyers have been asked to leave, with cuts centered on the real estate group. Several of our sources dispute this. From partner James Cross:
I don't have a tabulation of the practice areas affected. But as in other years, our review standards and decisions have not been influenced by the practices areas of the particular associates under review.
From another Simpson source: "Certainly nothing [in the reviews is] targeting one area or another. Our real estate department is not that large to begin with, and they stay busy."
It's clear, however, that some dismissed associates are unhappy -- and speaking out about what they perceive as poor treatment. From one Simpson associate who received a poor review (various potentially identifying details redacted):
I just spoke to a recruiter, and he informed me that it is becoming more widely known that STB is [letting go of] associates (he said that a colleague of his is repping someone who was just fired by STB yesterday)....[In the spring], I had my annual review, and it was very good.... I was told that I'm where I should be as a mid-level associate.... Since then, I've only done [a few] deals, on none of which I got any indication that I screwed up, nor did I do anything differently on these deals. I generally have received positive feedback for as long as I've been here.
[In the summer] I got a call from a partner in the personnel committee for a meeting. I was told that, despite my positive annual review, I was now falling behind my class in development and that this meeting was the precursor to the meeting in which I'm told to look for another job. Strangely, this meeting was with the same partner who gave my annual review, who seemed a little embarrassed about this very sudden about-face...
During this meeting, the partner informed me that it is the nature of law firms to have large classes of first and second year associates, fewer third associates, and still fewer associates as one moves up. I'm guessing that our group seems to be in a bit of a bind because we staffed up during the boom years, and while the credit markets are reaching an equilibrium, they will never be what they were. So I think they have to trim the ranks, and they are being careful about doing so (they couldn't just go from a positive annual review to "start looking," so this is just part of their ass-covering)....
I feel awfully betrayed, and I'm very angry. I went from being wined and dined [several] years ago, to being shat upon now.
And from another such associate:
I am one of the Simpson Thacher associates who have been told to find other employment.... [T]he rumors are true. I am in the RE group in the NY office and know that this is happening at various levels in the group. I think it is affecting various seniority levels....In the past there were senior people who were asked to leave as partnership was not in their future, but this is different. Work is slow; business is down. There are no severance packages -- it is try to find a job by X date.
So there you have it; we've given you both sides of the story. Some claim performance-based dismissals, while others claim stealth layoffs; some say review standards remain the same, while others say they've been tightened.
The picture is less than pellucid, but that's life. We all have to make our peace with ambiguity and incomplete truth.
Regardless of what's going on with full-time associates, one thing lies beyond dispute: Simpson put on a great show for its summer associates this year. As we reported last month, their summers got a sneak peek at The Dark Knight.
Later in the summer, there was an absinthe tasting. How cool is that? Cheers!
Update: Simpson vigorously denies that it's engaging in layoffs. For more, see the National Law Journal.
Simpson Thacher gets tough on associates [TheLawyer.com]
Simpson ditches dead weight [TheLawyer.com]
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Shearman to Out of the V20!
FIRSTT!!!!!!!!!!!!!!!!!!!!!!!
Also, Simpson = TTT. Seriously.
I worked at STB this summer, 8 weeks in New York and 4 weeks in LA. I didn't hear a word of any of this.
3 - you were a summer associate, which means you were excluded from all information of any significance. Let's hope for your sake you plan on doing OCI - it's gonna get a lot worse before it gets better at STB...
3 = Summer that doesn't understand Potemkin Law Firm.
Where's the "Welcome to Skadden" pic when you need it?
Simpson to major recruiting problems!
Absinthe and Dark Knight... tacit advice to the summers to become drunkard vigilantes instead of corporate lawyers?
Former STB'er here:
"We've always had a midyear review process"
THIS IS A FLAT OUT LIE. It's always annual UNLESS you lateral in, and then it's annual. That's how they get you. You don't know your progress until annual review, so mid way through you can get canned. Any so called "mid year reviews" for non-laterals are stealth dismissals.
7: you mean there's a difference? Damn.
Simpson to 190K
Guys in my high school used to conduct stealth layoffs all the time while flat-out denying it. 'Twas no big deal.
FRAT STUD (MUFFIN).
Ha-ha 2nd and 3rd years. How bout them apples.
Sincerely,
Delayed starting date 1st year.
all firms have problem that not enough mid/senior-levels left so too many left [aside from slow business].
13 - "delayed starting date"? So they cold offered you and you didn't take the hint, huh?
sorry, 14 was meant for 12... damn refresh delay.
3 - wow, and as a summer, you would of course be privy to all the important imformation....
8 - Look at Cross's wording. He refers to a "midyear review PROCESS." He is NOT saying everyone gets a midyear review.
This "process" is described by the tipster:
The firm has long conducted midyear reviews for (1) first-year associates and (2) more senior lawyers who received negative annual reviews.
Maybe STB is regretting that they helped start the last round of pay raises last year.
_____ to 225K?
Is it time to start talking about bonuses?
Not really 20. You can talk all you want, bonuses are going to be few and far between. This year the men will be separated from the boys in the law firm context when bonus announcements come through ...
breaking info - no law bonuses this year.
And we have come full circle.
The ballyhooed "Simpson scale", once the prevailing model for the salary wars, is now the "revised" performance rubric that forms the blueprint for "stealth layoffs".
I like how "tipsters" and "insiders" even take the time to say the job searchers with STB on their resume are "way below average performance reviews, not even close calls". Stay classy, STB.
NY to 190?
"It's always annual UNLESS you lateral in, and then it's annual."
8 - maybe this is why you didn't do so well at STB.
Simpson TTThacher is TTT. I had the sloppiest interview callback experience with STTTB. All around unprofessional and disorganized. If that is how they treat someone they're trying to recruit, I can only imagine how much of a toilet experience it is if you actually accept their TTT offer and work there.
16 was a summer associate at Cadwalader, and didn't get a permanent offer. That's why he's pissed.
Any current STB associates have advice for the summers regarding this?
27,
My advice is to start submitting your resume elsewhere. I hear Elizabeth Halverson is hiring some strapping young male to be her Plebian bitch.
21 --
20 was clearly being facetious.
I'm a current associate, 27. I wouldn't worry about it if I were a summer.
This rumor may be true; this is the first I've heard about it, but that doesn't mean it didn't happen. But you're probably a lot safer at a wealthy firm like STB than you would be elsewhere in this crazy market.
LOL. Is there really any doubt that simpson is doing stealth layoffs. Its always convenient when performance layoffs increase by 500% when the economy is slow.
27 - Like 30, I too am a current associate and have just heard about this rumor for the first time. In fact, management previously told us not to worry when things initially slowed down in the spring as STB's outlook has always been longterm. They told us that hiring/attritrion has been steady throughout the last 10+ years and in economic downturns (e.g. 2001), they understand that they simply have to absorb the loss so that they can fully take advantage of the next upswing (i.e. they prefer to be overmanned in downturns rather than undermanned in booms). However, I must admit that I do not like seeing this rumor on ATL.
Regardelss, if I were a summer, I wouldn't worry about it in the least. You guys won't be starting for another year, when likely the economy will have turned around substantially. It's incoming associates and current associates that have reason to worry, and as pointed out by 30, we're still probably a lot better off here than elsewhere in this crazy market.
STB and CWT to merge?
Another current STBer -- i think this whole thing is ridiculous. I knew of a few people who were asked to leave and they were by all accounts and from personal experience very poor associates. the fact that the firm is getting rid of dead weight in an economic downturn should be neither scandalous nor surprising. every firm in new york must be doing this on some level. if you're worried about your job, start doing better work.
Nothing new about the midyear reviews, eh? Always been done, eh?
Sounds like the pigs are writing on the barn door in the middle of the night over there, if you get my meaning.
any chance it's just london personnel?
the "If Simpson Thacher, as it appears, is adamant that the lawyer reductions it is making are all performance-based, it is an admission that during the boom time it lowered its recruiting standards in order to staff deals" comment doesn't really make any sense. The recruiting standards probably stayed the same, but no one has any idea how an associate is actually going to turn out to be in 2 or 3 years, sometimes even the associate themselves. Firing someone for being a poor 4th year doesn't mean hiring standards were flawed-- it's just inevitable that some will turn out to be bad no matter what the hiring standards.
22- don't think so. I'm sure that by and-large-there will be regular bonuses this year. Sure, calling them "bonuses" makes them sound discretionary, but it's really become everyone's expectation in the legal world (unlike banking or finance) that they are a regular part of an associate's year-end pay --- at least at the top shops. Expect the big places to keep bonuses at the same level as last year. Anyone who wouldn't immediately match the others would lose out in recruiting and retention big-time.
So we'll get the same regular base bonus levels as last year, save a few places on the brink of bankruptcy. The only question will be whether partners will have some kind of "special bonuses" this year, for which obviously the chances are very slim.
22- don't think so. I'm sure that by and-large-there will be regular bonuses this year. Sure, calling them "bonuses" makes them sound discretionary, but it's really become everyone's expectation in the legal world (unlike banking or finance) that they are a regular part of an associate's year-end pay --- at least at the top shops. Expect the big places to keep bonuses at the same level as last year. Anyone who wouldn't immediately match the others would lose out in recruiting and retention big-time.
So we'll get the same regular base bonus levels as last year, save a few places on the brink of bankruptcy. The only question will be whether partners will have some kind of "special bonuses" this year, for which obviously the chances are very slim.
22- don't think so. I'm sure that by and-large-there will be regular bonuses this year. Sure, calling them "bonuses" makes them sound discretionary, but it's really become everyone's expectation in the legal world (unlike banking or finance) that they are a regular part of an associate's year-end pay --- at least at the top shops. Expect the big places to keep bonuses at the same level as last year. Anyone who wouldn't immediately match the others would lose out in recruiting and retention big-time.
So we'll get the same regular base bonus levels as last year, save a few places on the brink of bankruptcy. The only question will be whether partners will have some kind of "special bonuses" this year, for which obviously the chances are very slim.
"8 - maybe this is why you didn't do so well at STB."
Um, yeah, most people leave STB because they are tired of being golden-handcuffed slaves.
STB gives sweatshop a whole new meaning.
If it's posted three times, it has to be right. Yay for bonuses!
41 - What place isn't a sweatshop?
I'm with 41---what V50 firm isn't a sweatshop? I know some peddle that quality of life spittle, but is there any discernible difference? Not in my experience. I'll stick with the lockstep system with guaranteed bonuses.
any comment from the departed?
37, your comment is dependent on how many "poor" fourth years are let go. If its one or two scattered outliers, fine. But when you have greater numbers that that getting dismissed, it can really only be one of two things. Either, the hiring standards aren't adequate, or the standards that determine what is "good" or "adequate" change from year to year.
43 - There are a few, though I think there are worse things than working at a sweatshop (like working at a place where you've been billing 40 hours/month for most of the past year, fearful for your job).
46 - wrong. most people don't get it. some take longer to realize it.
Nerds Nerds Nerds Nerds Nerds Nerds Nerds Nerds
"Lat? Never heard of him. "
stb to 300k!!!
I just don't understand this. Simpson is CRAZY for doing this. They really helped their reputation a few years ago with their salary bump (they don't have the history or name cache of a cravath, S&C, etc. but are playing in the same league some/a lot of the time), and this just tarnishes it. It's totally, totally crazy. It can't be worth the PR to get rid of a few bad apples.
Don't you think if there were 30 associates let go we would hear from them here in the comments? (ala Paul Hastings or CWT)
The silence here is deafening.
I am thinking that this story is B.S.
51 - agree absolutely. I don't get it either. In one breath they say that they would rather see less profits than fire people in a downturn and in the next mess around like this. This is going to cause some serious reputational harm.
Question - for OCI is it worth it staying far away from firms who we know are laying off/trimming on "performance" grounds? or is it safe to assume that everyone's doing it but haven't been caught at it yet.
I have to say that I am more than a bit puzzled by the reaction. Let's assume the worst and that 30 associates were in fact asked to leave. There are what, 600+ associates in Simpson's office? Why is it even an issue if the top 5% is asked to leave, does anyone think that the worst 5% of associates anywhere (other than Wachtell and *maybe* Cravath) are decent performers by absolute standards? And if some poor performers were in fact fired due to their performance, would they tip ATL by saying "I was fired but only because I deserved it so it's all good" or would they more likely say "I can't believe I was fired and the firm that fired me sucks!"
"I'm with 41---what V50 firm isn't a sweatshop? I know some peddle that quality of life spittle, but is there any discernible difference? Not in my experience. I'll stick with the lockstep system with guaranteed bonuses."
If you don't think there is a difference between Simpson Thacher (6 on Vault 50) and say, Dewey Ballantine (35 on Vault 50), in terms of being a sweatshop, then you are kidding yourselves (or don't care because you got the phat cash).
STB gets everything and then some out of associates. In any domestic office it's not uncommon to see litigators and corp associates billing 2500-3000 hrs per year. Must be nice to have all that cash and never see your family. There's a reason that every January many STB'ers leave in droves. They get that bonus and then move on to more of a lifestyle place. STB is great for the resume, but working there long term can take a physical toll on you.
51: this is extremely valid. I've got EIP the next two weeks, and STB was seriously at the top of my list - seemed to have great work, prestige, cool people. the raise to 160k put them on my map (back when i was trolling xoxo as a pre-law.)
now, i can't see taking an offer from them if i get anything remotely comparable. why? because the worst sign for a firm is mismanagement. who cares about a couple vault points if the firm hires 150 summers a year and then does stealth lay-offs of 3rd years? fuck that.
As Blackstone and KKR go, so goes STB. This shouldn't surprise anyone.
56: The average billable for associates at STB in 2006 was 1950. The 2007 number was probably higher but this was mostly an anomaly because of the surge in PE work. Sure, some senior associates bill 2500 if they want to make partner, but this is not (and has never been) the norm.
I am an associate at STB and can confirm these reports. I think there was a reluctance, at least for me, to share these events for the sake of protecting those who are looking for new jobs. But I know three associates who were fired in a way very similar to the report described here - fine annual review, called in out of the blue for a second review, severely criticized and given notice. The business model adopted by big law firms obviously does not work, but STB's approach to both the boom and bust makes even less sense.
Can anyone in the know give any sense of how long associates who were fired as described here are given to find a new job?
This is disgraceful especially coming from a firm that made specific assurances to its associates that there would be no credit crunch related firings. We've all been reading about the CWT story and at least that process had a sense of transparency and honesty about it.
The current business model - recruiting, staffing, training, and billing - is all a massive fail. Too much money bet on people of unknown quality or dubious loyalty, all based on perceived pedigree.
So we get a bimodal starting salary distribution combined with horrendous associate washout rates and toxic work atmospheres.
STB stinks for many reasons. I summered there and every associate I met was miserable. On top of that, they had a psychotic "Big Brother" system where they would track your movements. No joke -- on every other floor there was a receptionist who would ask your name (until she knew you) and then enter into a central system that you were in the buiding AND what time you arrived. This information was available for anyone at the firm to see. They would also ask you where you were going when you went to lunch, or ANYWHERE and would enter this information into the system as well -- "out, expected to return this afternoon," etc. And of course, they would enter your departure time. Now, this was in the summer of 2003, so they may not do it any more, but I thought it was very odd, to say the least. So anyone who thinks they might mind this sort of constant tracking should definitely find out if the system is still in place.
I jumped ship and went to DPW instead, where there was no such craziness, and the people were far more normal.
However, I agree that any firm with no minimum billables and lockstep base/bonus is ALWAYS superior to a firm without those things. There is no such thing as a lifestyle firm, and when push comes to shove, your compensation at such a firm will be based largely on your hours. If you're planning to bill 2500 a year, great for you, you'll probably get a nice bonus. If not, or if you want to be sure you're still well-compensated even if the market tanks, take the lockstep security.
SIMPSON THACHER TO 500K
64: The tracking system you speak of seems to make a great deal of sense. Obviously if someone tries to reach a colleague it is helpful to know if they are out for the day, will return later in the day, etc. In fact, it seems the only reason not to have it is because people would worry about their movements being "tracked" even though having the system makes much more sense as a way of doing things. Now, DPW is more prestigious and selective than STB, hires a lot more people from HLS/YLS or court of appeals clerks, etc. and probably has better exit opportunities, so in all likelihood you made the right choice by going there. But pointing to the "tracking system" is just plain silly.
lulz. stb tried to play with the big boys but couldn't hang. know your role.
LW to V6!
14: Alright, lets clear this up. There is a stark difference between rising 3Ls now and entering 1st years. Back in Aug 2007, the legal landscape was not nearly as shitty as it is now. Firms made offers to their summers thinking they would have no problem with providing them work around this time 2008. They didn't cold offer at that time, like they're doing now.
What they did is have a piss-poor ability to forsee that the legal market was about to go to shit like every other financial market was starting to do. So, its hard to take "a hint," when the people making the offer had no f*cking idea what was about to hit them.
64: I guess you had an experience at STB very different from my own.
I was at STB this summer. The secretary on my floor definitely tracked when I came in and left, but never once asked me where I was going when I left, and secretaries on other floors never asked me for my name. I worked at another firm last summer that operated the same way, so this didn't strike me as odd.
I also met a number of junior and midlevel associates who were satisfied with their jobs and generally happy. It was heartening and not something I expected to find in a big NY firm.
66 -- sorry, the tracking system was indicative of stb's laser-like focus on making sure its associates are ALWAYS aware that the firm is carefully monitoring their level of slavish devotion to the firm. and its' creepy. giving an associates blackberries is an easy enough way to make sure they are always available and is what other firms do. and of course, other firms have programs that allow you to know if someone's away on vacation, etc. -- as dpw does. but sorry, it truly did grate on my nerves to have people yell after me as i left a floor or even the security guards at the front of the building asking if i would be back later. I already know that I've sold my soul to a firm, at least for a few years, and I don't need to be clocked in and out like some sort of hourly worker as a constant reminder of the fact that they own me.
69 -- The overwhelming majority of hedge funds, investment banks and government officials didn't foresee what the economy would be like in 2008 (and the consequences for many of these players were infinitely worst than the consequences for law firms). Why in the world would you expect law firms to have foreseen this?
72: From a legal perspective, anyone doing any capital markets work should have forseen that there were some serious valuation problems with these instruments. I think most firms, like the IBs, just looked the other way with the fact that the products had some serious risks that were not accurately valued.
I wasn't really suggesting that law firms should have known that there was going to be a serious downturn in financial transactions. I was more indicating that when offers were put out in August 2007, the firms weren't "cold offerring" people. They simply did not know what was about to hit them.
For those summering now, I think the firms are being more cautious with making offers just for the sake of being able to say "we offered 29 of 30 summers."
71 - "but sorry, it truly did grate on my nerves to have people yell after me as i left a floor or even the security guards at the front of the building asking if i would be back later."
I have never seen this happen at STB. Maybe the policy has changed in the past 5 years?
only in the completely screwed up world of biglaw could a firm be accused of "mismanagement" for asking a small number of associates who are either lazy or incompetent to leave in an economic downturn. these associates may have been allowed to coast when the firm was too busy too care but it's not 2007 anymore. despite the usual stress and BS that comes along with being a biglaw associate anywhere, it's sad that a firm like STB that is fundamentally a great place to work and stocked from top to bottom with nice, talented and decent lawyers is taking these hits for something that every other law firm is doing right now.
because of this kind of garbage, firms come under all kinds of pressure to give offers to an entire summer class based on completely meaningless 2L interviews. not surprisingly, some of these people can't hack it. anyone bitching about all this has never been on a team picking up the slack for a completely useless associate that is nonetheless collecting the same paycheck and bonus as you are and allowed to get away with it.
you can either accept that firms will let serial underperformers go at a time when banks are laying off thousands of associates or you can accept that firms will stop giving offers to every idiot who manages to get a summer offer. maybe everyone is so spoiled by the white-hot legal market of the last four or five years they have completely lost perspective but this is insane.
75
stb to 110K!
This rumor is absolutely true. But from what I've heard, this type of thing is happening EVERYWHERE. Firms that try to lay off too many too quickly get caught. The commenters who are screaming that STB is a TTT should get a clue. Unless you are at Cravath or Wachtell, your firm is doing it too.
56 - the average billables in 2007 of STB litigators was less than 1800 hours and every single one took home the full bonus. as if that didn't discredit you enough, you also manage to idiotically compare stb disfavorably to dewey, which is a notorious sweatshop and a miserable place to work.
75 --
agreed. if these layoffs are truly performance based and are confined to 30 or so out of over 600 attorneys, they're likely to make STB a _better_ place to work for anyone whose not so wholly incompetent or lazy that he's at risk of being fired himself.
79 here. whose = who's. ugh.
Mismanagement? Hindsight is 20/20.
This place is turning into xoxo.
The only problem is blindsiding associates with this. Associates are not tenured. Firms should let go of underperformers when they choose to.
However, evaluations should put these associates on notice. Even if a firm is only keeping an associate because the market is good, why give them a sparkling evaluation? More honesty in reviews would mitigate a lot of these problems.
Simpson is a toilet. All I know of the place is that according to my top 10 school's recruiting information, STB was far and away the least selective of the V10. Disgusting.
82, in every evaluation, there is a question asking in which areas can the associate improve. when the firm needs a reason to kick them out, they'll put the emphasis on that answer, and every evaluation becomes a negative one. it's a no win situation.
I was told by a senior partner that "they'd review the evaluations more closely." It was an implicit threat.
Sorry to disappoint you law students but every single major firm is engaging in stealth layoffs. I'm surprised this site has not covered the abnormally high number of performance-based firings *cough stealth layoffs cough* at Latham, Simpson, and others.
Hundreds of thousands of people are being laid off nationwide in a variety of industries. Rather than getting pissy over these tough economic conditions try to keep your head up and count your blessings. Nobody is entitled to a job so be thankful for every paycheck you get. You will live a happier life with this attitude.
in the age of atl how does the sign in/sign out still exist
I know STB does not have the same type of arrogant/obnoxious partners who have made a place like CWT so despised. But you have to at least give these CWT partners some credit for being honest about their layoffs and somewhat generous with their severance packages. I would definitely be more pissed if I got laid off in the shady way these SBT attorneys have been (particularly with the misleading evaluations).
Do current STB associates or the people who have been evaluated have any inputs?
For the past several years I know of a few people who get the talk around this time of the year. If you look at the departure memos that have been going out, so far the vast majority of people are going to places that they've had to line up for a while (AUSA, going back to school, various non-profits) or to some pretty sweet in-house jobs. It might be that there are a ton of people in the pipeline to leave now, but I doubt that it's that much more than usual. In M&A, for example, there's a desperate need for more mid to senior associates, as people are as busy as ever at that level (it's much slower for juniors).
As for the logging in/out system - it's easy to just leave without being logged out. It's a little annoying, but not really that big of a deal. There is some truth to a security guard yelling after you if you are coming back - but it's only one extremely officious guy, on the weekend, who never, ever should be in a role of "power." The rest of the guards are pretty cool.
It's too bad that these rumors are flying because STB is actually a pretty decent place to work. The hours can be long, but since there are no billables required, people do slip out early when there's nothing going on.
Where do I found out which firms have lock-step salary/bonus structures? I 100% agree that this structure is the best for an associate who does not want to bill 2,500 hours.
I agree with 87. CWT partners got dragged through the coals for what they did (and rightfully so). But wide-scale "performance related" firings are more damaging to the affected associates and therefore, much, much worse.
Those of you complaining about the stalker.net system at Simpson obviously didn't use it to your advantage. I used it to track partner movements all the time.
-Former STBer
92 -- fair point, it was definitely helpful to track partners and know when you could slip out to the gym, etc. My main gripe with the system was the fact that it stored the information, so you could see anyone's history of arrival/departure times. If you're someone who might like to leave a bit earlier and do work from home, the system did not reflect this. In fairness, I'm sure no one really cares about this information as long as you're billing enough, but the knowledge that it was all there, readily accessible to anyone who wanted to see it, was obnoxious.
Those complaining about stalkernet obviously don't work at Simpson.
93 -- they got rid of that, the histories aren't available anymore and the arrival/departure time isn't available either. it just tells you if someone is in the office or not.
Simpson Thacher Denies Layoffs Report
These days, news of possible lawyer layoffs moves faster than New York office workers trying to get to the beach on a summer Friday.
The cloistered New York legal world was abuzz on Monday thanks to a story in British legal newspaper The Lawyer , which reported that 745-lawyer Simpson Thacher & Bartlett -- an old-line New York firm with $966 million in revenue and profits per partner of nearly $3 million last year -- was clandestinely trimming its associate ranks by roughly 30 lawyers through midyear performance reviews.
The story solicited a stern response from Simpson Chairman Philip "Pete" Ruegger III.
"This is something that was made up by that rag in the U.K., it's just complete nonsense," Ruegger says. "We aren't doing anything differently than any other year and we actually have less attrition this year than last year."
Ruegger's rhetoric was seconded by several New York-area recruiters, who say they have yet to see a spate of Simpson resumes from lawyers looking for new jobs.
Alisa Levin, a co-founder of legal search firm Greene-Levin-Snyder, says, "We constantly talk to associates [at Simpson] and we would have heard of something by now."
Another principal at a large national recruiting firm who requested and received anonymity thinks that an economy that continues to reach new lows is responsible for all the scuttlebutt.
"I've heard the same [Simpson] rumors but I haven't seen anything definitive," the recruiter says, adding that current market conditions are unlike any other she's experienced before. "[So many practice groups] right now are quiet and we don't have a bankruptcy upswing like we did with the last downturn," she says. "Right now we just have to wait and see how this is going to pan out."
While Ruegger declined to comment about Simpson's practice areas, The American Lawyer reported in its April issue that activity in the firm's enormously successful private equity group had cooled . (Several Simpson partners, including recruiting co-chairs Kenneth Ziman and Lynn Neuner, did not respond to requests for comment.)
One former midlevel Simpson associate contacted by The Am Law Daily did corroborate the layoffs report. "I don't know how widespread it is but since the end of 2007 and the beginning of this year, [Simpson] began concentrating on these performance reviews," says the ex-Simpson associate, now with a rival Am Law 100 firm. "I do know it's still happening across the board and they're focusing more on the midlevels than otherwise would be the case because they're the easiest to get rid of."
The former associate says midlevels are essentially told during performance reviews that they should seek employment elsewhere. "They'll say, 'I don't think you have a future here so maybe you should have a look around in the market,'" says the Simpson alum, adding, in reference to the recent news that another large firm was cutting close to 100 lawyers, "It's very sneaky and sort of [the opposite] of what Cadwalader did with its layoffs."
But a senior associate in one of Simpson's non-New York offices -- all associates contacted for this story requested and received anonymity -- says that he's seen nothing outside New York to indicate the firm is culling its associate ranks.
"I'm 100 percent certain that no one has been laid off in my office in the past five years, and I would be shocked if [layoffs] were the case because I haven't heard anything to that effect," the associate says. "But there are 600 lawyers in [the New York] office so who knows how these things get started."
When it comes to job cuts, it seems, layoffs are in the eye of the beholder.
Any other comments from former or current STBers????
any stb summers reinterviewing?
STB summer associate with offer here. T5. I will be doing 3L interviews (but I had planned on doing so before these rumors came out).
because of the summer experience?
No, I had a good summer experience, but I just want to see what else is out there. I can still see myself at STB, but the summer experience and the people at STB just didn't scream out to me, "Simpson is awesome and I need to be here."
-99
"This is something that was made up by that rag in the U.K., it's just complete nonsense," Ruegger says. "We aren't doing anything differently than any other year and we actually have less attrition this year than last year."
No kidding. Attrition was higher in the past because people were flocking to in-house jobs (early to mid '07). Layoffs/cold reviews could have increased substantially. These guys aren't as clever as they think.
Current STBer (non-NY office) - I echo the sentiments of 96. I know there was some grumbling about mid-year reviews in litigation some months back, but I'm certain that no one was laid off in my office. Furthermore, I don't think anyone is generally worried about being laid off even though certain areas are consierably slower than this time last year (i.e. corporate was getting crushed this time last year and now it varies from manageable to slow).
PHJW is doing the same thing. DC office headcount is down almost 40 lawyers.
Simpson's Palo Alto office has 35-40 attorneys, 10-11 partners, but guess how many summers they have who are starting in a couple months? 25! And guess how many summers they have this year? 25! How is this office of 40 going to handle another 45-50 associates in less than a year, esp since they'll have to move to accomodate everyone? I guess this means theyll to layoff some of these people too?
105 - a lot of those summers split offices -- how many are actually starting in palo alto this fall.
those aren't split, I think all are there for entire summer, could be wrong, but maybe there is a STB Palo Alto associate here, I know some read this website....
105 -- your numbers are way off. That may have been the case 5 years ago, but these days there are 48 associates alone, 16 partners and 1 counsel---just check their website. That's 65 total attorneys. 20 incoming associates and 25 summers is a lot, but up until this spring when things really slowed down, those numbers weren't crazy. I have a friend in corporate there and they were dying for juniors last summer as they had more business than they could shake a stick at. So, the incomings will probably be slow but by the time the summers enter in 2009, they'll probably be happy for the numbers as business will have picked up again. It's more the current associates who have reason to worry -- but at $50K a pop in lateral recruiting fees, they probably won't make any cuts for quite some time as the hit they'd take in recruiting (both at law schools and laterals) would be too big and not worth it financially. They don't have the recruiting power that NYC does, so in many ways they have to run a tighter ship.
67 is credited - so true
It is rumored that STB fired most of the women attorneys on flex time.....this summer we have received many departure memos from women that worked flex time!!!!!
110 is a liar.
110 is a liar.
Yeah, so 45 associates coming in a 12 month period is huge for such a small firm. But the thing you gotta realize is the incoming 1Ls are going to have to share offices, so when thi years summers start in 2009, STB is going to have to move across the street, so theyll not only have to pay for the extra 45 associates, but also twice the rent (room for the current and 2009 attorneys plus extra office space to grow), so you gotta figure it's gonna be a bitch.
I dont know about the corporate people in PA, but the litigators were barely billing 1800 hours, yet receiving full bonuses, so I dont think there is going to be a ton of work for these people.
Plus the Palo Alto office of STB is still paying for its old office when they first started up in 2001 or whatever, so it's not exactly very lean....
I work at STB. I can verify that midyear reviews for first years and underperforming associates is NOT new. I can also say that this post is the first I or anyone I know at the firm has heard about these so-called stealth firings.
It could have been happening under all of our noses.... but that seems a little unlikely. I also know a few associates, now midlevels, who started when their practice group was slow and billed maybe 100 hours over eight months. They're still here and thriving. The firm is doing really well now, and although people don't have the hours they did last year, almost everyone is keeping busy. My guess? Every year a few truly underperforming associates are told they'd fit better elsewhere. Perhaps this year they're taking advantage of the market situation to claim they were laid off?
Dude, did the 2Ls and summers posting worried comments actually read the post? Or are your thoughts so insubstantial that a whiff of a rumor is enough to set you running to the arms of a second-tier sweatshop over Simpson? Any reasonable read on the collected tidbits here lead to the conclusion that it is business as usual at STB, that there are no layoffs, and that maybe the five worst associates in the firm of 600+ lawyers are told they'd fit better elsewhere. As one who works hard enough and doesn't want to have to work doubletime to fix the mistakes and omissions of a lazy coworker, I can definitely appreciate a firm willing to tell a few worst performers to shape up or ship out.
I especially think the most ridiculous thing about this rumor is that the only (anonymous) associate who said there was a stealth layoff wasn't even asked to leave! He was just told he was an underperformer and unless he started to do better, he might be asked to take six months to leave after another eval in six months. Geez, talk about giving someone every chance.
This is probably the first actual STB NY associate to comment on this thread. It did the rounds a bit among some of my friends but frankly nobody paid any notice. So nobody is going to bother comment.
First there's definitely no stealth layoffs. I just looked up the last 20 departure memos and it's people off to jobs they were clearly planning: JSDs, investment banks, hedge funds, boutique firms, in house jobs, philanthropic foundations, changes of cities. And I know a lot of the people who left: the ones I knew were talented and definitely not "push out the door" material -- they left for the reason that most sensible people leave after a few years: they were done with biglaw. I think this is 100% started by an anonymous non-STB commentator for no good reason, and egged on by trolls. My two cents from the inside. (The inside of a great firm -- I summered elsewhere and came to STB. Def. no regrets, it's a good place to be.)
Just because the departure memos show people leaving for in house jobs or boutique firms, that does not mean it wasn't a "stealth layoff". The whole gig is that you get several months to find a new job while the firm promises to tell people calling for a reference that you are in good standing. It happens. And the whole story about negative yearly reviews = mid year review was cooked up by the firm as a means to this end. No one, that I know of, is told at the yearly review "hey buck up, you will be re-evaluated in six months and might get the boot". You could think you are doing great; It comes out of the blue on a late summer Thursday and after you have put in 8 mos or more of the year you are also screwed of your "lock-step" bonus.
And yeah the tracking system sucks. yes it is helpful to figure out where partners are and yeah all you have to do is leave from a floor with no secretary, but what a hassle. About a year ago they altered it a bit so its not so big brother-y. I think this is because they realized the summers didn't like it and it was hurting recruiting.
Like any firm, STB is great for some people, awful for others. The people being groomed have no concept of the ones that are only in it for a few years. I once heard them referred to as passive agressive and I found that to be a very good description.