Husch Blackwell Goes with Salary Cuts
A month and a half ago, Husch Blackwell laid off a number of employees. At the time, Husch Blackwell’s chairman Dave Fenley refused to use the term “layoffs.” Instead, he said:
He said that Husch Blackwell was “going gangbusters” in certain areas and was meeting its numbers this year, “which is pleasantly surprising.”
Later, Fenley admitted that the gangbusters comment was “boneheaded,” but he also said:
These [layoffs] would’ve occurred “regardless of the economy” but the “economy reminded us” that it needed to be done.
But the latest news out of Husch is hard to reconcile with a firm doing well despite the difficult economy. Details after the jump.
Yesterday, Above the Law received reports that Husch Blackwell has decided to cut associate salaries. A tipster remarks:
Husch Blackwell Sanders LLP has rolled back all starting salaries to 2007 levels. Doesn’t this seem a bit inconsistent with the Dave Fenley’s previous statement that the firm was “going gangbusters” in certain areas and that previous “layoffs” (a term of art according to Fenley) were unrelated to the economy?
Maybe the terrible economy just “reminded” Fenley that the firm could get away with reducing associate compensation. It’s not like disgruntled associates can easily leave for greener pastures. At least not yet.
The cuts will be between 5% and 10% according to multiple sources. Tipsters report that the cuts should be a little bit less deep at Husch, because the firm didn’t fully embrace raising salaries in the first place.
We can’t wait to hear how the firm characterizes this salary cut.
Earlier: Nationwide Layoff Watch: Midwest Firms Have Lawyers, Fire Them Too
Husch Blackwell Follow Up
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firsttttttttt
Do you think firms are paying Ellie to make it look like salary cuts are the normal thing to do in this economy? I wouldn't put it past him.
Hush who?
Seriously, not trying to be a dick, I have just never heard that name in my life.
Why do we say SOUTHERN California, yet also say SOUTH Texas and SOUTH Florida? Why don't we say South California? I mean, really, what is the deal with that?
Have never heard of this firm ....
As a term, "gangbusters" is sorely underused in modern society. Please note that I do not count the LAPD and NYPD "Gang Buster" units as legitimate uses.
I guess that Replevin of a Cow work must be slowing down after all.
Who cares what is going on with firms not in the V100? This is not news for most of the people who read ATL
This firm has one of the ten best environmental / real estate attorneys in the nation. Fact.
HBS is V 100 now. The sad thing is Husch & Eppenberger was a much better firm before the merger.
HBS is V 100 now. The sad thing is Husch & Eppenberger was a much better firm before the merger.
9: who gives a fuck?
Who ya goin' call? GANGBUSTERS!!!!!
I ain't afraid of no gangs!
Just because a failing firm like Husch Blackwell is making salary cuts doesn't meant that this is going to be the norm.
Even people in the midwest have never heard of them, and I work there. Everyone thinks it's a no name accounting firm when I tell them where I work.
This would never happen at WILDMAN HARROLD
4- That is a very good question.
@ 10,11 - your crappy firm is not in the Vault 100 and is not deserving of an acronym
The problem with firms like Husch Blackwell isn't that their salaries are low--$100,000 goes very far in the cities where its offices are located (Peoria, IL, Chatanooga, TN, Kansas City, St. Louis, etc.). The problem is that their bonuses are miniscule compared with other markets.
Salary cuts always sadden,
And these layoffs are starting to madden.
But I’m not affected.
Thank god I rejected
Latham and wound up at Skadden.
--Above the Limerick
The problem with firms like Husch Blackwell isn't that their salaries are low--$100,000 goes very far in the cities where its offices are located (Peoria, IL, Chatanooga, TN, Kansas City, St. Louis, etc.). The problem is that their bonuses are miniscule compared with other markets.
4, 17 - collegiate branding.
There is a university of South Florida, but there is a Texas Southern. So perhaps that is not the answer.
To complicate matters, its South Jersey too, but southern Maryland.
This boggles the mind.
I'm just thinking out loud here, but is there any chance the associates whose salaries have been cut could bring a reliance action -- ie, promise or estoppel -- against the firm? Admittedly, it's been a while since I've read Restatement 90, but I think it covers this sort of situation -- especially if the associates moved cities to take a job.
21, the problem with Husch isn't the money at all. It's that it's the most arrogant bunch of people you'll ever meet.
McDERMOTT WILL & EMERY
There will be more associate layoffs.
The salary freezes will turn to salary cuts.
I have heard it from the horse's mouth (think member of ARC, ACC, Mgt. / Exec. Committee) in the DC office.
22,
Don't forget South Texas School of Law.
For a while, there were two colleges in central Texas going by the names of Southwest Texas State and Southwestern. Southwest Texas State has since rebranded into Texas State (presumably as an homage to the underrated movie "Necessary Roughness" starring Scott Bakula, Robert Loggia, Sinbad, and Kathy Ireland, among others).
I'm with 23 here. The guy did say they were going "gangbusters." Associates could reasonably rely on their salary remaining the same. This may be a slam dunk Section 90 case.
McDERMOTT WILL & EMERY
There will be more associate layoffs.
The salary freezes will turn to salary cuts.
I have heard it from the horse's mouth (think member of ARC, ACC, Mgt. / Exec. Committee) in the DC office.
McDERMOTT WILL & EMERY
There will be more associate layoffs.
The salary freezes will turn to salary cuts.
I have heard it from the horse's mouth (think member of ARC, ACC, Mgt. / Exec. Committee) in the DC office.
What a nice thing to do to the kids during finals.
MWE -- do tell?
MWE -- do tell?
MWE -- do tell?
MWE -- do tell?
Husch, husch, hurry hurry cut my salaries.
there is nothing wrong with salary cuts in a down-time.
but, husch handles it the wrong way. if you are going to cut salaries, announce it as a team approach. let people know that partners are sharing the pain also. emphasize that you are doing it to save layoffs. let your team know that you share the wealth in up-times and share the pain in down-times.
but husch lays people off and then tells the whole world it was because they were shitty attorneys. way to ruin careers husch.
can't wait until their big clients like monsanto realize what a db firm they are and get real local counsel.
McDermott / MWE --
Hit "post comment" once.
Has anyone out there heard from the horse's mouth whether there will be more associate layoffs and/or salary cuts at MWE?
26 -- 22 here.
The plot thickens.
Its definitely North and South Georgia but there is a Northern Arizona University . . . I just cant reconcile this.
Damn you 4, why did you kick my dormant OCD into a swine flu level pandemic.
SECOND-RATE FIRM CUTS ASSOCIATE SALARIES, ADMITS INFERIORITY, ACCEPTS INABILITY TO RECRUIT TOP TALENT IN FUTURE
26 -- 22 here.
The plot thickens.
Its definitely North and South Georgia but there is a Northern Arizona University . . . I just cant reconcile this.
Damn you 4, why did you kick my dormant OCD into a swine flu level pandemic.
39 -- create an shtick, perhaps with one of those old timey paper boys -- and post the "truth" in all these threads.
That was surprisingly succinct and informative.
Wait, who did what?
"because the firm didn't not fully embrace raising salaries"
Elie, all it takes is one proofread.
- Blackline
4. Isn't it just that "south" is supposed to have a more definitive connotation than "southern?"
South Jersey, South Bronx, South Boston, I feel like these are places that I can pinpoint on a map. But where the heck is "Southern Boston" or "Southern Jersey?" More to the point, when does Southern Boston become "not-Southern Boston?" Is there a demarcation line? I know the minute I (escape with my life from) leave Southy, I couldn't necessarily tell you precisely when I leave Southern Boston.
My two cents. I hate that I spent time thinking about this.
--Elie
The shocking WILDMAN HARROLD news nearly made me throw up my lunch. And now this unbelievable development, coming out of HUSCH BLACKWELL. Good god almighty.
1. Cut a hole in the box.
2. Kill self.
Husch - the self-proclaimed "K-Mart of St. Louis Law Firms"
Elie - 22/ 40 here. Can you pinpoint South Jersey better than you can pinpoint Southern California?
Elie is right.
Who?
THIS FIRM IS IRRELEVANT
The ship be sinking...
12: No big deal. Just one of the MOST IMPORTANT LAWYERS in the entire country. No no, I'm sure you're a pretty important 2L in law school yourself. Let's talk about you for a while, shall we?
Anyone else sasses their environmental / real estate division deals directly with me. I have brass knuckles.
Full disclosure: I also have moderate chronic constipation.
It is Southern Illinois...
HBS only hires the top 10% from WUSTL. That's probably why you've never heard of them.
52, one great lawyer does not make a great firm... At a firm the size of Husch, five great lawyers do not make a great firm.
@52 Who is this "important" lawyer and why is he at such a crappy firm?
I know for a fact that HBS hires outside the top 10% at WUSTL.
55 - what did I say? It looks like you've got an appointment with Dr. Knuckles. If you wouldn't mind taking the train to Chicago (the Brass Knuckles Express (tm)), I will meet you at the station and pummel you with aforementioned knucklature.
54, so the top 10% at Washington U in StL isnt even good enough for Biglaw?
I hate Wash U
I'm still waiting for this Comments section to go gangbusters.
Yay for Cow Replevin! I did that last week.
41 - like this?
SERIOUS COMMENT POSTED ON ATL, EDITOR MAY GIVE THOUGHT TO FUTURE HEADLINES
-39
Any word on other STL firms?
Thompson Coburn deferred until January - I guess a 5-10% pay cut is better than 4 months without pay?
HBS has 90/650 "best lawyers"
Skadden has 172/2000+
just sayin'
HBS hires well outside the top 10% at Wash U. While they officially require top 1/3, they certainly hire people who are not in the top 1/3.
Don't they realize that anybody worth keeping will just leave after 2 years?
St. Louis is a real dick town, inhabited by dickheads, and run by dickless politicians.
True dat 68. True dat.
Ladybug ladybug, please fly away.
58 - I didn't like you at first, but now you're ok.
For anyone having doubts regarding the potential problems inherent in the hourly billing model, check out the papers in the malpractice case against Proskauer in Connecticut (Lindholm). What we're seeing in layoffs and salary reductions is not unrelated to the expectation of many firms that, in addition to recessionary factors, there inevitably will be a shift toward more project and performance based billing models which, in turn, will impact firm profitability in a negative way.
@63 - well played sir, well played.
(checks watch)
Yes, Husch still sucks. This firm acted quite unprofessionally during a callback interview. St. Louis is also the most strangely provincial place I've ever been. I guess that's the natives' way of coping with being from a shithole.
63 - 41 here. I heart you.
Good thing I went with Shook Hardy
Understand that the requirements at OCI for St. Louis firms at WashU is different for those from St. Louis and those that aren't. Firms can and do go much lower in the class to have one of their own but have much more stringent standards for an outsider.
-WashU08
WashU08, just goes to show you how paranoid St. Louis firms are--no non-native would ever want to spend his life in that shithole.
39/63/NewsFlash-
That is the best schtick I have ever seen on this blog. Funny, and brief. Your schtick couldn't be better. PE and all you other idiots take note. This is how blog schtick is done. I look forward to seeing more of your posts.
78, HBS hired at least one member of the Wash U Class of '10 for a summer associate position who is not from St. Louis (not from the midwest, for that matter) and is not in the top third.
2nd 80's sentiment. Its about time we had a decent schtick around here!
Almost all people that work at big east and west coast law firms have egos anyway
What truly sucks is that I have to find this out by surfng the web. You better believe I'm just waiting for the economy to recover...
-Pissed-Off Associate
35--I know you be a youngster, but let me fill you in, management and partners feel the pain far before you SA's and Associates do. The apple don't fall from the tree....But if you read the news you would know that we are in a RECESSION and TIMES ARE TOUGH, so quit yer bellyaching....you chose to go to law school and nobody made you any promises about your brilliant career!
WashU08 - if you are not from St. Louis, you will do better with firms outside St. Louis. St. Louisans talk about what a great town it is, but then never understand why anybody would want to live there if they didn't grow up there. Very parochial. If you went to the right high school in St. Louis, you get the job, otherwise, tough luck.