At that point, we knew of sixteen firms that had sent memos to their associates notifying them that raises were not forthcoming. While certainly unpleasant, everyone acknowledges that it’s more welcome than layoff news.
Today, we’re getting e-mails from several associates who are freaking out that the freeze is on at their firms, based on their first paychecks of 2009. Their paychecks came in last night at 12:01 a.m. and they are the same amount as paychecks last month. Here are the unconfirmed freeze reports we’ve received so far…
Mayer brown checks just popped at last years levels. So apparently there is a freeze, maybe, but no memos on it yet. Please investigate.
Today was the first pay day in 2009 for Mayer Brown NY. In the past, our first pay check of the year automatically reflected salary increases. No such increase today. Smells like a pay freeze?!? With the added courtesy of letting ADP announce it instead of management.
(UPDATE (6:05 p.m.): Mayer Brown spokesman Bob Harris says the firm “has not yet announced its plans for lawyer compensation in 2009″ and that it usually makes the decision in February.)
Steptoe & Johnson froze salaries. What stands out about this is that they did not send a memo or anything telling associates salaries would be frozen, or saying when/if the position would be reconsidered. Today was our first payday, and they just issued everyone the same checks they were getting last year. No comment. No memo. No explanation. Typical douche-baggery.
They haven’t made any announcements of a salary freeze. They just haven’t announced any salary increases and continue paying the old salary. When I looked at the employee system to check the amount of tomorrow’s paycheck, it shows that I will be paid the same salary as last year.
One Mayer Brown associate advises colleagues to chill out about their first paychecks of the year:
I work at Mayer Brown. Every year they raise salaries in March and retroactively pay associates what they would have gotten since March. Definitely getting sick of panickers here. These people need to get a life.
Ballard Spahr has frozen salaries, memo below.
Boutique IP firm RatnerPrestia is freezing its billing rates, proudly trumpeting the savings to its clients on its website.
BALLARD SPAHR SALARY FREEZE FIRM-WIDE E-MAIL
From: Kahn, Geoffrey A. (Phila)
Sent: Monday, December 29, 2008 3:07 PM
To: Non-Partner Lawyers (All Offices)
Cc: Partners (All Offices)
Subject: Non-Partner Lawyer Compensation
As in the recent past, the evaluation conferences for non-partner lawyers will take place in January. The purpose of this e-mail is to address two issues–salaries and profit-sharing bonuses–that typically are discussed at those conferences.
As I am sure you all appreciate, the Firm is not immune to the world-wide economic downturn. In light of these circumstances, the Firm has decided to keep the salaries of all non-partner lawyers at their 2008 level in the coming year. The Firm will pay profit-sharing bonuses in early 2009 based on 2008 performance, business generation and billable hours. The bonus amounts will be reduced and the eligibility criteria will be modified in certain respects that will be discussed during the January conferences; however, the total number of participants in this year’s profit-sharing program is virtually identical to the number of participants a year ago.
We very much appreciate the efforts of our non-partner lawyers and are confident that, with your help, we will be successful during this challenging period. In the meantime, we hope that you understand the reasons for the actions described above.
RATNERPRESTIA PRESS RELEASE
RatnerPrestia Announces Rate Freeze and Fixed Fee Initiative
Valley Forge, Pa., December 2008 – RatnerPrestia announced that it will freeze essentially all attorney billing rates for at least the next six months. In a letter to its clients, the firm states its desire to assist clients in weathering the current economic storm and announces its rate freeze as part of that effort. RatnerPrestia’s move represents a departure from the general trend among law firms. One published report indicates that other firms plan a 5% rate raise in 2009.
In addition to the billing rate freeze, the firm will also encourage clients to consider alternatives to billing arrangements based on billable hours. The firm already serves, or has proposed to serve, a number of existing clients on the basis of fixed fees for well defined projects or for a volume of less well defined projects. Such fixed fee arrangements, with the inherent predictability of costs that such arrangements entail, enable clients to budget for legal services as they do for other goods and services, according to Paul Prestia, the Chair and co-founder of RatnerPrestia. He indicated this was a primary objective of the new policy, in this time of economic distress, when clients can and should demand predictability and cost containment from their law firms.
Jonathan Spadt, who leads RatnerPrestia’s IP Strategy and Counseling Practice, added that fixed fee billing in that practice area necessitates defining the scope of a study project and adhering to that scope as the project progresses. Scope changes must be dealt with as they occur. This requires discipline on the part of both the firm and the client. The same challenge is faced in litigation and dispute resolution, according to Benjamin Leace and Harrie Samaras, who head the firm’s litigation and dispute resolution efforts. These are typically longer term projects and depend on periodic updating and agreement as to the fixed fees for each upcoming period.
Much of RatnerPrestia’s practice involves preparing and prosecuting patent applications. Kenneth Nigon, who leads the firm’s Patent Preparation and Prosecution Practice, indicates the challenge of fixed fee billing in that practice area, depends on an understanding that the fee applies to a volume of applications which can be dealt with in a uniform way. Typically this takes into consideration the range of complexity in a number of applications from a common source.
RatnerPrestia expects that its new policy of proactively encouraging inquiries concerning alternative billing methods will require each client’s cooperation in order to develop, on an ad hoc basis, realistic and fair alternative billing practices for that particular client. While the firm’s General Terms of Representation have always invited such practices, the new policy indicates that the firm will place increased emphasis on its efforts to pursue such alternatives.
In its third decade, RatnerPrestia is one of the largest intellectual property law firms in the Mid-Atlantic region. Its clients range from start-up companies to multi-billion dollar corporations, both domestic and international, and include well-known institutions and universities. Its attorneys and patent agents include many with advanced degrees in a variety of technologies and with industry experience either in research or as in-house counsel. For more information, call (610) 407-0700.