We previously expressed skepticism towards the notion of a salary thaw. As Elie wrote, “Ha. Haha. Unfreezing? Yeah. Let me just ride my unicorn down the streets of El Dorado and see what there is to see.”
But perhaps the joke is on us. It seems that some firms are unfreezing salaries. On this subject, of course, we are happy to be wrong. Green shoots, an end to the recession — yay!
On Friday, we reported on Allen & Overy’s decision to unfreeze associate salaries. Today we bring you news of a similar decision by Akin Gump.
Memo after the jump.
The email, from Akin Gump chairman Bruce McLean, appears below. It also contains a status update on 2009 associate bonuses:
In addition to continuing with our current compensation system, I am also pleased to announce that we will be awarding bonuses for 2009 performance. As usual, that process should be getting under way shortly.
When the bonus numbers come in, please let us know (subject line: “Akin Gump bonuses”).
The memo below should be read in light of two of our prior posts — here and here — regarding an earlier, partial salary thaw at Akin Gump. The firm’s compensation system is a little complex.
As we understand it, if you’re at Akin and hit the 2000 billable hours pace in each quarter of 2010, you will earn — with the help of the “quarterly productivity payments” — an amount equal to the standard New York market rate for your class year. For example, a class of 2007 associate who bills at the 2000 billable hours pace for the entire year will earn a total of $185,000 in 2010. If this class of 2007 associate falls short of this pace in each quarter and receives no quarterly productivity payments in 2010, then the associate will earn a flat $170,000 base salary.
Have we gotten this right? Feel free to discuss in the comments, or email us. Thanks.
AKIN GUMP — MEMORANDUM — 2010 ASSOCIATE AND COUNSEL COMPENSATION
From: McLean, Bruce
Sent: Friday, December 18, 2009 5:58 PM
To: FW Associates; FW Counsel
Cc: FW Practice Managers
Subject: 2010 Associate and Counsel Compensation
As you know from my past communications, Kim Koopersmith and I have been in discussions throughout the year with firm management and the Chairman’s Associates Committee regarding associate and counsel compensation. After much review and deliberation, the firm has decided to continue with the current salary grid and productivity adjustments. Thus, in 2010 associates and counsel who meet performance and productivity expectations will move up one class in base salary with the potential to earn an additional class increase through quarterly productivity payments based on performing at an annual 2000 billable hours pace (including 100 pro bono hours).
We have made significant progress on developing a core competency system for professional growth that will define the expectations at each class level, ensure that each of you are provided the opportunities to obtain the necessary skills and that you are provided feedback through the evaluation process to keep you fully apprised of your progress and development. Kim has already been working with an outside consultant on this process and we intend to complete it during the first quarter. We believe that implementation of this system is imperative to provide you with the greatest opportunities for professional development. In addition, should we conclude at a future date to adjust our compensation system to move away from the current lock step system, we believe that a well defined system of core competencies and feedback will significantly enhance any such transition.
In addition to continuing with our current compensation system, I am also pleased to announce that we will be awarding bonuses for 2009 performance. As usual, that process should be getting under way shortly.
I would like to take this opportunity to thank everyone for their hard work and dedication to the firm and its clients. While it has been a challenging year for all of us, everyone’s contribution have helped make 2009 a success.
I wish you and your families a very happy and safe holiday season.
Earlier: Open Thread: Salary Thaw? Anybody?
Akin Gump: Salary Unfreeze Update
Akin Gump (Kind Of) Unfreezes Salaries
I’m so firsty, SO VERY FIRSTY :)
Bruce MacLean = TTT for not knowing the difference between “underway” and “under way.”
Lat is also TTT. It’s McLean, not MacLean, as shown in the very email and link provided in the post. I should have known better than to trust ATL’s spelling without checking up on it.
– 2.
3 – Wow, you’re brilliant.
Actually, it is “McLovin”
I hope you assholes start making more money. I am looking for investors in my new business: a couch with cushions large enough for a short fat man to hide in.
Sorry Elie, or whatever the fuck your name is, I don’t think my company will be equipped to make couches the size of king-sized beds.
We need to bomb spell-checkers back to the stone age!
-DOJ Secure
6 – This post is by Lat, not Elie.
So, my read, not knowing Akin Gump:
1) They’re keeping lockstep, for now
2) Most people will advance in 2010 (and get raises), assuming they meet whatever baseline requirements exist
3) People have potential to be “made whole” as to their original class rank based on billables; I assume these will be paid out quarterly depending if you’re busy or not, so if you have a busy Q1 but a slow Q2, you might be behind still
Notwithstanding that, they’re going to wait and see what the market does later in 2010 and conform to whatever that is (aka “their consultant”)
Just goes to show you: ATL is a great place for raw data, but a lousy one for analysis. You guys are best at just being funny while you pass along info. Your endlessly gloomy (bordering on apocolyptic) prognostications serve no one outside of feeding the paranoid’s delusions.
The economy is rough right now—-we get it. But things are not over for America, and you can count on lawyers making plenty of money, just like they always have, for many moons to come.
Barbecue it, boil it, broil it, bake it, saute it. Shrimp-kabobs, shrimp creole, shrimp gumbo. Pan fried, deep fried, stir-fried. There’s pineapple shrimp, lemon shrimp, coconut shrimp, pepper shrimp, shrimp soup, shrimp stew, shrimp salad, shrimp and potatoes, shrimp burger, shrimp sandwich.
As I read this memo, Akin is merely giving people a single bump this year from whatever their frozen salaries were and not restoring the full 160k-280k NYC scale by giving a double bump. That’s a big yawn. Even firms that froze last year won’t freeze for a second year in a row (but see truly struggling firms like DLA).
13 – MWE might
The joke is on us, because Lat actually has ridden a unicorn down the streets of El Dorado.
Comments on Akin’s bankruptcy group? Are the partners a-holes? Would you take it over, say, Kirkland or Davis POlk?
Can someone confirm 13’s reading – a single bump?
Great, does this mean Akin will think about offering a deferral stipend anytime soon?
18: lol. no. you are expected to find a paying legal gig for 1 year. good luck with that.
deferral with no stiped? You guys are looking for jobs some place else, right? Because if Akin bails on you, you will be utterly screwed.
Didn’t they withdraw offers after they made them last year? Not very trustworthy///
16,
you would be retarded to take AK bankr. over the other two.
FWIW, I’ve heard some chatter that McDermott is planning a similar “true-up” of associate and income partner salaries, at least in certain markets.
22 — MWE income partner, here (Los Angeles).
I know that the Executive Committee approved an upward adjustment for income partners, effective the second pay period in January. I’ve heard word that their may be a similar increase for associates, but I can’t confirm if its final and for what associate classes.
Akin Gump is one of the most poorly managed firms out there and frankly I am surprised it hasn’t received the type of infamy that L&W received for its piss poor treatment of associates, particularly very junior ones, during the cap markets crisis. Maybe that’s because AG didn’t enjoy a stellar reputation in the first place. I personally witnessed the life of a colleague virtually destroyed either by the blatant mishandling of the associate’s exit or the blatant exploitation of the individual’s good nature in the process. Hard to tell which. Either way, pitiful. To the poster above inquiring about “taking” AG bankruptcy over the other firms. Don’t even think about it. Run the other way.
13, 17 – using ATLs terminology: single bump in base salary; “double bump” via quarterly “true up” payments if you are on pace for 2000 hours in 2010 (500 hours per quarter). Example, if you have a slow first half of 2010 and only get 900 hours by end of Q2, but things pick up in Q3 and you are at 1500 by end of Q3, you get the “true up” payment for Q1, Q2, and Q3 at end of Q3.