Livin’ For The City
The effects of the global economic crisis continue to trickle through all aspects of the legal industry. Many firms simply aren’t willing to share the profits with associates as has been done in years past.
While we tend to focus on the Biglaw view of this crisis, it’s important to remember that associates as smaller firms are getting hit just as hard or worse from a dollars-per-hour perspective.
Last year we brought you a series of posts on law firm life outside of the top teir. One of the firms we highlighted was Kaufman Borgeest Ryan, a boutique insurance coverage firm with offices in New York, New Jersey, and California. Starting salaries there are about $90K while senior associates make just under what Biglaw first-years pull down.
In the past, associates have been eligible to receive around a $10K bonus, if they meet the minimum billable hours requirement of 2100.
Imagine being a lawyer, living in New York City, billing over 2000 hours a year, and making less than six-figures. Calgon take me away.
This year, associates at Kaufman should still receive their bonus, but it’s complicated. More after the jump.
Bonus decisions at Kaufman are usually made after year-end associate evaluations and paid in December. But late Wednesday night, associates were informed that things would be a little different this year:
Based on these evaluations, we determine salary increases, and from time to time, bonuses. The bonuses typically have taken many factors into account. Billable hours have certainly been a significant consideration in bonus calculations, but other qualitative factors have been considered and taken into account as well. Not everyone gets a bonus. In the past, we have distributed bonus checks in December. This year, the bonus checks will be distributed in the first quarter of 2009.
The firm is bumping associate reviews into 2009 causing the bonus delay. Why? According to the firm:
The primary reason for this change is simply to reduce the number of important decisions and activities that typically take place in December. We will continue to evaluate new partners at year end, and will continue to evaluate staff performance at year end.
Riiiiight. It’s just too darn busy in December. But hey, at least there are tax benefits:
An incidental benefit of this change in the scheduling of evaluations is that the taxes you may be obligated to pay on your bonus will not be due in the April immediately following your receipt of the bonus, but rather, a full year later (the taxes on a bonus received in December are due the following April; the taxes on a bonus received in March are not due for 13 months, the following April).
But remember Kaufman also makes salary decisions at the end of the year as well. That set up will hold for this year, so deserving associates will still get their 2009 raises on time (Latham brain trust, you still have time to reconsider your shocking decision). But in 2010 it gets complicated, and in 2011 it gets ugly:
So, after this year’s evaluations (which will take place over the next week), the next time we will evaluate associate attorneys will be in the first two months of 2010. Our plan is to make any raises awarded in that review retroactive to January 1, 2010. The following year, 2011, we will make raises effective when granted, in March.
The thing is, at least Kaufman is telling associates what they are going to do going forward, as opposed to retroactively taking away pay that people feel they’ve already earned. How is it that a 100-lawyer boutique like Kaufman can get down with the concept of “fair warning” but some of the most prestigious shops in the land are quite happy to pull the rug out from under their associates?
Nobody really knows where the economy is heading. But some firms seem to be treating their associates as part of the team, while others seem to be treating their associates as part of the problem. The former is better.
Earlier: Where Do Non-Top-Tier Grads Go? Hello, Insurance Law!
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LAST!
and LAST!!
Numero Uno
FOIST!
as = at
Speaking of which, any guesses as to what Elie makes at ATL?
I am the greatest!
Epic fail, 3 & 4
-1 & 2
Speaking of which, any guesses as to what Elie makes at ATL?
"Last year we brought you a series of posts law firm life outside of the top teir."
c'mon elie
6, don't know. But probably tied to revenues/page views/unique users or something similar.
you're is not your
pick it up Elie - you are getting lazy
9- Do you read ATL for the news, or just to look for typos?
c'mon # 9
"But some firms seem to be treating their associates as part of the team, while others seem to be treating their associates as part of the problem. The former is better."
You are exactly right.
7/1 -- I am actually the greatest, but I called away on other business.
Speaking of which: if you don't make at least $160K, you are poor.
But way less than what Latham pays right?
I've always been an Elie supporter (mostly out of pity), but this is hard to read.
9- Do you read ATL for the news, or just to look for typos?
c'mon 9
The Calgon reference vindicates Elie for all of his past follies.
So we've established that ATL doesn't pay Elie much. Any estimates of his food budget?
Don't mock Elie! He went to a top TEIR law school!
"The affects of the global economic crisis"
You're kidding, right?
"...you're shocking decision."
Seriously?
I love this spin. We're going to delay your bonus so be happy--your taxes will be lower this year! Heck, we'll even reduce your bonus when it does get paid so your future taxes will be lower too! Aren't we nice guys?
Elie, for this feature, check out Darby & Darby, IP firm that pays top dollar even though their rates and billables are much lower than Biglaw, that had major partner defections in 2008 and a bunch of firings in Dec.
lol @ "attorneys at law" -> the surest sign of a TTT podunk firm
Hey people, give Elie a break on the typos. Don't you know that affirmative action beneficiaries get two free typos per sentence. It's the least society could do for the two centuries of slavery before 1865.
If you criticize this affirmative action policy for typos, you're a racist.
Why are we letting Elie get away with a Calgon reference? Talk about a new low...
Kevin. Get back to work and stop reading ATL. The letters will come when the letters come.
Who's Kevin?
Elie is paid in snausages
LEAVE HIM ALONE! You are lucky he even performed for you BASTARDS!
LEAVE ELIE ALONE!
Obviously, Kevin is a guy waiting for his letter.
Who's Kevin?
Tax benefit to whom? Isn't the firm required to withhold taxes from bonus checks at the highest marginal rate?
33, a guy waiting for his letter!
BAKER & DANIELS CUTS STAFF: Baker & Daniels LLP has cut 10 local jobs and 12 support positions in its Indianapolis office to bring the law firm's professional-to-supportstaff ratio in line with the industry, Tom Froehle, chief executive partner, said Tuesday (Fort Wayne Journal Gazette). No legal professionals were among the workers, whose last day was
Dec. 10, Froehle said. The staff reductions came about after an "operational review" that found younger attorneys are more comfortable and efficient with technology and have less need for clerical staff, Froehle said. The employees were given severance pay and help finding a new job.
I am shocking a Sheep right now.
Everyone I know who worked at a small firm after law school ended up screwed, either laid-off, fired because one partner didn't like them, or worked to death for no money. Small firms are horrible. You should expose them. People think BIGLAW is bad but there are so many people working 2,400 billables plus in SMALLLAW for less than half of what BIGLAW attorneys make and they have to put up with the fact that one or two partners control the firm and their entire life.
Calgon take me away? Could Elie be any gayer???
@14-- Obama says if you make more than $250K you are rich!
I push rhymes like weight.
Ice Cube
"...and making less than six-figures."
I wouldn't believe it if I had seen it with my own two-eyes: working for twelve-months and the total of your twenty-four-paychecks being less than six-figures. I have several-friends with a crappy four year degree who make significantly-more than that.
FOR THE LOVE OF GOD: YOU ONLY HYPHENATE COMPOUND MODIFIERS THAT PRECEDE A NOUN.
is it a letter containing his severance?
is it a letter containing his severance?
What is a compound modifier and how does it affect / effect me as a human person?
Agreed 38. SmallLaw = 95% of the hours for 40% of the pay. It's a wholly-owned subsidiary of hell on earth.
And for that matter, I would rather be unemployed than work in Jersey.
Kevin, we want to hear from you.
Does anyone else find that they never understand the pop-culture references that Elie chooses to include in his posts? I've never heard of Calgon, and maybe I'm just too young to be familiar with a commercial from the 1970s (according to wikipedia), but I'm curious as to whether I'm the only one left scratching his head by most of Elie's posts.
Does anyone else find that they never understand the pop-culture references that Elie chooses to include in his posts? I've never heard of Calgon, and maybe I'm just too young to be familiar with a commercial from the 1970s (according to wikipedia), but I'm curious as to whether I'm the only one left scratching his head by most of Elie's posts.
Does anyone else find that they never understand the pop-culture references that Elie chooses to include in his posts? I've never heard of Calgon, and maybe I'm just too young to be familiar with a commercial from the 1970s (according to wikipedia), but I'm curious as to whether I'm the only one left scratching his head by most of Elie's posts.
Does anyone else find that they never understand the pop-culture references that Elie chooses to include in his posts? I've never heard of Calgon, and maybe I'm just too young to be familiar with a commercial from the 1970s (according to wikipedia), but I'm curious as to whether I'm the only one left scratching his head by most of Elie's posts.
28 - here. Kevin went to lunch. (bastard) But I intend to have IT block this site from his computer. He needs to be reviewing documents and not trolling the comment boards hoping to hear about his compensation. Who else is going to do the work I intend to take credit for?
Does anyone else find that they never understand the pop-culture references that Elie chooses to include in his posts? I've never heard of Calgon, and maybe I'm just too young to be familiar with a commercial from the 1970s (according to wikipedia), but I'm curious as to whether I'm the only one left scratching his head by most of Elie's posts.
48/49, if you're scratching your head, may I suggest Head & Shoulders instead?
(I got Elie's reference, though it made little sense in this context.)
The starting salary here is nowhere near 90K. Double check your source Elie.
48-53, how did you manage to post 4 more times while I was replying to you? I don't think youth is your problem when it comes to getting things.
42 - have you considered switching to decaf? seriously. i'm worried about ya, man.
I would rather work in a shithole like Dallas than set foot in Jersey. Fucking makes me puke.
oujjllhdk
Nailing Sheep
Seems less like a "boutique" and more like an "insurance defense" sweatshop.
Oh man, the image of Elie in a bathtub is not what I needed after lunch.
This place routinely loses associates to higher paying Sedgwick Detert....salaries at KBR are not nearly as high as Elie claims.
38 - you are dead-on!
I work at a small firm in Chicago (a city with expensive rents, not NYC or SF, but expensive nonetheless) where I'm paid $65K and expected to bill around 2200. My boss is a sycophant that expects me to buy my own BB leash and pay for the service, too.
I have ZERO sympathy for a BIGLAW associate that, even with a salary freeze, pulls in $150K or more as base, and then gets insulted when they get a bonus of "only" 1/2 of my salary. Choke on Drier's penis, you selfish pigs.
This firm is a TTT.
-Kevin
Kevin here. I do the cha cha like a sissy girl. I lika do the cha cha.
48-52 - you're apparently just pop-culturally challenged, unrelated to your age. I was born in the 80's and definitely know about Calgon.
65 is an imposter!
-Kevin
"Calgon, take me away!"
FAIL.
"Calgon, take me away!"
FAIL.
I've always been neutral about Elie's sense of humor, Lat's sense of humor was closer to my own I think.
But "Calgon take me away." got me. ROFL.
"Calgon, take me away!"
FAIL.
38 is right. Small firms are horrible. And anybody who has worked at one wouldn't write, "Imagine being a lawyer, living in New York City, billing over 2000 hours a year, and making less than six-figures."
You can all cry over a $20,000 bonus. But what would you do if you got a $250 bonus?
"Calgon, take me away!"
FAIL.
"Speaking of which, any guesses as to what Elie makes at ATL?"
I hear he's up to two meatballs a week.
My dad married the woman in the Calgon commercial, a.k.a. my stepmom, (there were anumber of different commericals with the same tag line). Basically, the phone's ringing, the kids are screaming, the roast is burning and the harried (but very well dressed) mom yells "Calgon take me away." Then she floats in a giant soap bubble over a field of flowers and they cut to her taking a bath in a tub set among the flowers. Calgon is a cross between body wash and bubble bath.
The ads ran for a long time too. It was way later than the 70s though. I saw the ads in the mid-80s.
For the reconrd -- I've understood all of the pop-culture, SF, erdy, trivial references to the 80s Ellie uses -- but they are mostly useless and often not pertinent to the post.
I've always been neutral about Elie's sense of humor, Lat's sense of humor was closer to my own I think.
But "Calgon take me away." got me. ROFL.
72 - I'd walk right out the door of WEMED.
Elie hears potential gossip, and he JIMPS.
I am a lawyer, living in NYC, billed 2300 hours so far this year (with two weeks left to go), and make less than six figures. It's not uncommon.
Elie hears potential gossip, and he JIMPS.
63: Precisely. Maybe I haven't been reading the comments to this blog long enough to know what's said sarcastically and what isn't, but it seems odd to have one post that claims "It's getting ugly out there" when attorneys at Wachtell don't have their salaries doubled via bonus, and another post a short while later moaning about continued job cuts (this time, at Gunderson Dettmer.) I mean, really. Which is better: collecting a smaller bonus and having a job, or collecting a bigger bonus and risking that you'll be out on your can in a month or two?
Look, the bonus structure is certainly down from where it was a few years ago, but realistically, this is still very good money being paid as bonuses. Even $17,500 is nothing to scoff at. There are people who support their families on not much more than that, even in the five boroughs. Let's get real. The money isn't an insult.
I am a lawyer, living in NYC, billed 2300 hours so far this year (with two weeks left to go), and make less than six figures. It's not uncommon.
I have worked at KBR for several years. It is a terrific firm. They treat us really well and the work is, generally, very interesting. All of the lawyers and staff here are truly top notch. We have a lot of opportunity for professional development. The hours are high, but it is certainly not a “sweatshop.” I don’t know where you got the salary data. Salary info here is top secret. Nobody knows what anybody else makes, and nobody talks about it. I have no idea if your info is correct or not, but we all believe salaries are all over the place. Other firms probably pay a bit more, but I am confident none is as pleasant a place to work.
More importantly, to the person who leaked the memo, thanks for nothing. One of the ways the firm treats us well is by sharing information, but that includes a level of trust. Now that the trust has been broken, I’d be surprised if we saw candor like this again. Leaking the internal memo was a weak decision.
Kevin from Home Alone?
"KEVIN!"
83 = KBR partner
75= im a little older than you but i just wanted to let you know that I nailed your mom. What a hairy bush!
"that associates as smaller firms are getting hit"
??? Mystal you idiot. Are you really that stupid?
There is another side to "small law". I work as second year associate in a litigation botique in Boston, make about $105K plus a 20K associate bonus this year. (Our associate bonus structure is a little different)..billable hour requirement 1800. Life works just fine for me....not all smaller firms are sweat shops. I love the people I work with- well most of them....
...and one day I may even learn to spell boutique...sigh.
28 - here. Kevin is that you? GET BACK TO WORK. BTW - Got my letter.
38 - Dead on. Good to know that other small firm lawyers read this site. Small law firms are hell on earth. If your firm is run by an asshole, it's unfathomable how awful the experience is. The guy I work for is the worst human being on earth, and there's not escape. Especially in this market.
this post smacks both of elitism and pathetic insecurity.
outside of the top tier? give me a break. there are many small firms full of talented lawyers who had the balls to think outside of the box when it came to making career decisions. just because they don't have the pr machines that the big firms have, doesn't make them lesser businesses.
i work for a small firm (and turned down an offer at sutherland asbill to work here). i make less, but i enjoy my life more. and, two years in, i have enviable trial and deposition experience.
i am usually a supporter of yours, elie, but you need to get off your damn high horse.
this post smacks both of elitism and pathetic insecurity.
outside of the top tier? give me a break. there are many small firms full of talented lawyers who had the balls to think outside of the box when it came to making career decisions. just because they don't have the pr machines that the big firms have, doesn't make them lesser businesses.
i work for a small firm (and turned down an offer at sutherland asbill to work here). i make less, but i enjoy my life more. and, two years in, i have enviable trial and deposition experience.
i am usually a supporter of yours, elie, but you need to get off your damn high horse.
83- Whats so bad about publishing this memo? If the partnership didn't want it to become public information they certainly could have taken steps to prevent it. If the partnership is embarassed about salary info leaking and bonus and review policies becoming public information, they should really get over it. At many firms, this information is readily available for public consumption. Either the firm wants transparency or it doesn't. As associates, information is our only way to make informed decisions-- especially when it comes to smaller firms like KBR. Whoever released this memo did a great service to attorneys considering working for KBR. Godforbid a candidate for employment there or at any small firm be on equal footing with the partners when it comes to information.
92 & 93 clearly thinks that it is beTTTer to continue living in denial than to acknowledge your own failures.
I work at a small shop (10 attorneys) in SF. Two years in, 110k w/ 25k bonus this year. 1600 hours req'd -- I billed just under 1700. I don't work nights or weekends, and I took my three weeks of vacation last year. I have taken some 20 depositions in two years, have my own cases to run, and have extensive independent client contact. We do litigation, but the work is varied, generally interesting, and puts me in front of federal judges on a regular basis. Couldn't be happier.
83-You are either a partner or are Forrest Gump's twin. KBR is a Wilson, Elser clone. The founding partners at KBR came from WEMED and continued on in the oppresive ways they learned from Tom. KBR is not even insurnace coverage, it's insurance defense. The KBR evaluation/bonus scheme is just like WEMED's. 83, you've been outed!
83-You are either a partner or are Forrest Gump's twin. KBR is a Wilson, Elser clone. The founding partners at KBR came from WEMED and continued on in the oppresive ways they learned from Tom. KBR is not even insurnace coverage, it's insurance defense. The KBR evaluation/bonus scheme is just like WEMED's. 83, you've been outed!
98 -- I know third or fourth year associates at ID firms who'd kill to get a job at Wilson Elser. They'd start there at $90K, which would double their salary.
You can't make any sweeping generalizations about life in small firms. Each one has a different personality and they differ widely from practice area to practice area. The small firm I started in was pretty cool. Hours were reasonable (rarely there past six and only ocassional weekends). I got to do work I wanted to do right off the bat. Sure the dollar values for deals/cases are smaller, but try getting that experience at a larger firm. It won't happen. The pay sucked to begin with, but once I proved myself the salary started going up. And when the market was good for my practice area a few years I ago, I made a lateral move to mid-size shop and hit the ground running. I had an idea of how to practice law without having my hand held through every single task. Partners appreciate that.
Friends are other places? Not so lucky. Insurance coverage/defense firms are notoriously bad. The partners get squeezed by the clients on price which then trickles down to the associates. Sweatshop conditions. Shitty raises. No bonuses. Sounded terrible.
This is not surprising, insurance work is notorious for squeezing the lawyers. An insurer isn't going to pay Wall Street rates for fucking car accidents and routine coverage cases, if a NYC firm doesn't want to work for the rate they want to pay, there are good people on Long Island that would take the work.
100 - Very impressive. Good for you. If you keep up the good work you can make almost as much as a BigLaw first year associate before your 55th birthday. Maybe a Half-Skadden first year bonus is in for you too by the time you become senior partner!
102, those are some pretty big assumptions you are making about my current salary, huh? Yearly raises and bonuses for associates at mid-size firms vary greatly from associate to associate. It's called merit based compensation decisions. And it is usually how the rest of the business world functions.
This is not that bad. District attorneys get shafted much worse.
Given the choice, I would rather be a district attorney or legal services lawyer than an ID associate.