Salary Cuts

Allen Matkins: Salary Cuts Hit Paralegals Too

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Back in March, we reported on salary cuts for associates at Allen Matkins. At the time, we reported:

First year salary has been reduced from $160K to $145K. A number of other associates (excluding first years) were informed that their salary would be reduced by 15% or 30%. Those associates were told that they were selected to receive “adjusted” compensation based on their hours, although the actual method for determining which associate would be subject to this salary adjustment was not disclosed and remains unclear.

We now understand that many mid-level and senior associates took a 20% salary hit.
But we also understand that a 20% salary cut has also been executed on the firm’s paralegal contingent. A tipster reports:

You did not mention that paralegals were grouped with associates and also had their salaries cut by 20%.
Associates and paralegals all met individually with two partners who notified us of the pay cut and told us that if we could manage to get our billable hours up to goal before the end of the year we would get the full 20% back. And if we could get to a slightly smaller goal, they would return 10%. There were no explanations about how they arrived at these various figures and at that time we didn’t know that first years’ salaries were only being cut 10%. We were told this measure was needed to avoid further layoffs although there were also a number of people let go that day.

We haven’t really heard about firms cutting salaries on paralegals. Paralegals have been fired for sure. But there just hasn’t seemed to be a lot of economic upside to shaving a few dollars on salaries of people who already don’t make very much money.
More news from Allen Matkins after the jump.


Paralegals and senior associates alike are not happy that their salary was reduced by a higher percentage than new first year attorneys:

We were also bewildered at how the partners came to the percentages they did for the different groups. The average salary of an Allen Matkins paralegal is around ½ of the salary of a first year. No one understands how they could have come to the conclusion that 10% was appropriate for those making $160K and 20% for those making half that amount. The larger group of associates that were also having their salary cut by 20% was, on average, making 2.5 to 3 times the salary of a paralegal. Of course a 20% pay cut is significant to anyone, however, there is a big difference in having your salary go from 200K to 160K vs. 80K and dropping to 64K. They offered no explanation of their reasoning and questions were not encouraged.

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Even though Allen Matkins paralegals are apparently full participants in the economic downturn, it doesn’t appear that they were riding high during the boom times:

After the initial euphoria of still being employed began to fade, calculating on what this meant in actual dollars began in earnest. It was very sobering and for some just impossible. Allen Matkins’ salary range for paralegals is significantly less than other firms their size or larger but they emphasize that they are a quality of life firm with a lower requirement of billable hours, which is attractive to many of us. However, these lower salaries have been dormant for the last couple of years, our raises not even meeting cost of living increases, adding a 20% pay cut in cities with a high cost of living like Los Angeles or San Francisco is not reasonable.

Are there paralegals elsewhere that are having their salaries cut? Share your pain, paralegals.
Earlier: Nationwide Layoff Watch: Allen Matkins Continues the Layoff & Salary Cuts ‘Super Combo’

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