Akerman Senterfitt is a Florida based firm, so — given the economy in Florida — it’s not all that surprising that the firm has decided to join the salary cutting party.
Multiple tipsters independently confirm that Akerman has instituted an across the board, 10% pay cut on all class years. Here is the internal email about the salary cuts obtained by Above the Law:
We are announcing today a 10% reduction in all associate salaries, effective immediately. This action is being taken in response to market conditions, which I know you are all aware of and which I need not belabor. I want to make it clear that our firm’s financial condition remains very strong, and even clearer as to how much we appreciate all your hard word and effort on behalf of the firm.
As previously announced, the associate bonus hours grid that we have used during the past few years has been eliminated. Instead, we will be carefully reviewing each associate’s performance at the end of this year as we consider paying merit-based discretionary bonuses to those meeting the established minimum qualitative and quantitative requirements.
As the email suggests, everybody is well aware of the terrible situation happening in the legal economy. But is the terrible economy forcing Akerman into this situation, or is the firm simply taking advantage of the difficult economic situation to roll back salaries?
After the jump, tipsters who have seen Akerman’s books claim that this is a salary cut of choice, not necessity.
According to sources, Akerman recently took the extraordinary step of “opening [its] books” to senior associates. Giving associates first-hand knowledge of the firm’s financial situation seems like a good move. Unless the numbers suggest the firm didn’t have to cut associate salaries, but decided to do so anyway. Here is our tipster’s report on the underlying financials at Akerman:
This is completely bogus. The management just held a meeting where they “opened the books” for associates. According to their presentation, the firm’s revenues were exceeding budget and expenses were 7% below budget….
I understand that collecting on our hours is much more difficult, but the numbers they shared don’t demonstrate a noticeable impact on the bottom line. They continue to hire laterals. Staff members have been spared. This is a flat-out money grab, and associates will remember this when the economy turns around.
Another tipster said simply:
Look at the numbers. This is crap.
In response to our request for comment, Akerman Senterfitt furnished us with this official statement:
It is our policy not to comment on any personnel matters. Our firm’s financial condition remains very strong, and we appreciate all [the associates] hard work and effort on behalf of the firm.
It’s pretty amazing how many firms that are in a strong or “very strong” financial position still feel the need to cut associate salaries. Maybe this really is just a “mental recession,” and the economy is actually just fine.
Clients don’t necessarily care if a firm is making a salary cut out of necessity or out of choice. But current associates (and prospective future associates) do.
Good luck, Akerman associates.
Earlier: Prior ATL coverage of associate salary cuts