Comments on: Associate Bonus Watch: Orrick, A Case Study in Merit-Based Bonus Payments

By: guest

guest — Mon, 15 Feb 2010 15:35:18 +0000

at 13,
Yes, yes we are. And the money’s not bad either.
-Spoiled Brat

By: guest

guest — Thu, 11 Feb 2010 09:48:58 +0000

Keep in mind that Orrick was well above market for the 2008 bonuses, provided you billed at least 2000 hours. And billing 2100 hours got you even more above market. And finally, breaking 2100 and getting great reviews got you even more above market (but very few people got that). Basically billing 2100 in 2008 gave you a big enough bonus to make up for the salary freeze in 2009. Actually, for some levels, billing 2000 also got you on par with associates at places like Cravath.
So high billers beat the market for 2008 or you could look at it as doing fine as compared to non-frozen firms during the course of 2009. Now again it looks like the most highly rewarded associates will beat the market. Not necessarily at every year, but at a bunch of them and certainly a big chunk will beat any market (frozen or non-frozen) at the senior associate level.

By: guest

guest — Thu, 11 Feb 2010 04:55:45 +0000

34 – why would you assume that people who got 0 would get 0 under either system? under the old system, if you hit certain hours marks you were required to get a certain bonus. now, you could hit that same mark and get nothing.
the people i know at places doing merit based systems who are pissed are people who are well regarded. their concern is that the firms are promoting a risk-reward situation that is in reality just a risk with no reward – i.e., promising that there will be the possibility of a big number if you’re awesome, but not actually delivering. based on this memo, it seems like that’s in fact the case since it doesn’t look like orrick is paying 10-15% over market as promised. so the firm is basically asking its top people to stick around in the hope that they’ll get compensated for undertaking that risk, but then not delivering. why would someone who thinks their awesome stay at a place where they have only a speculative chance of making what would elsewhere be considered a normal salary? you would need to have a chance of making significant more than the standard to justify the risk.
the people who are at the bottom have reason to worry under either system. people always talk about lockstep like you’re just on an escalator and promoted without reason. but the truth is that shitty people get kicked off that escalator (i.e., fired or forced out) eventually, albeit sometimes it takes awhile.

By: guest

guest — Thu, 11 Feb 2010 03:36:33 +0000

33 – but it also makes no sense to include those who didn’t qualify for a bonus (e.g., associates who just started). the assumption is that people who got 0 bonus would get 0 bonus under either lock step or merit based. so it seems the more meaningful number is one that only includes those who got a bonus.
i still think that people who are most resistent to a merit based system are those who believe they are at the bottom or will never rise to the top and are content to just get by. and i don’t get why firms should be incentivized to reward or keep them. i would imagine people who excel would welcome the opportunity to stand out and be compensated for their higher level work.

By: guest

guest — Thu, 11 Feb 2010 03:25:18 +0000

It’s pretty funny that in calculating the “median” they excluded everyone who got nothing.
Guess those folks at Orrick became attorneys because they weren’t too good at math.

By: guest

guest — Thu, 11 Feb 2010 03:22:17 +0000

This system is not that “transparent.” It includes no breakdown of what associates got in bonuses by year. That’s understandable given that Orrick is shifting away from a focus on year, but it makes it impossible for associates to compare themselves to peers at other firms.
In particular it makes it impossible to determine whether Orrick is actually paying at least potentially some associates 10-15% above market, as it promised it would in the last memo the firm released. In fact, it seems the opposite is true. You can’t crunch the numbers for managing and senior associates, since there’s no breakdown by year (i.e., you don’t know whether the 60k bonus is going to a 4th year managing associate or a 7th year managing associate), but examining the numbers for regular associates shows there’s no way the firm is paying any of them 10-15% over market, whether defined as freezing firms or non freezing firms.
According to this memo, the maximum that any third year associate at Orrick was paid, including salary plus bonus, was 194,500 (170 base for a third year under the frozen scale, plus 24,500 in the maximum bonus for a regular associate). But at a non-frozen firm, a third year would have made 200,000 (185 base plus 15 in bonus). If Orrick were paying any regular associates 10% above market, it would have had to pay a maximum bonus of 50,000 to bring total compensation for a third year up to 220,000 (i.e., 10% above 200,000).
Assuming that Orrick is defining the market only by firms that froze, which is probably the case, the market rate at other frozen firms for third years is total compensation of 185,000 (170 base plus 15 in bonus). 10% over that would be 203,000, yet the maximum a third year is getting paid according to this memo is 194,500 (which is only 5% above market).
You can’t crunch the numbers for managing associates and senior associates because there’s no breakdown by year, but from what you can tell it seems there’s no way Orrick is keeping its promise to pay at least some associates 10% above market.
These bonus numbers are pretty reasonable if viewed in a vacuum, but the double speak from the firm and the faux transparency is getting old.

By: guest

guest — Thu, 11 Feb 2010 01:00:04 +0000

3: I suspect making partner at Thelin was easier than making partner at Orrick. Moreover, I don’t see how an incoming partner from another firm (much less Thelin) could promise you anything about how a new firm would treat you. Having been through that game years ago when I joined a comparable firm (MoFo) as a senior associate, I can tell you that any such promises are empty, even if made with good intentions. I wish you well. But you’ll need to keep working very hard if you want to be made partner. Promises will never get you there. They didn’t work for me at MoFo, and I doubt they’ll work at Orick.

By: guest

guest — Thu, 11 Feb 2010 00:21:54 +0000

3, I mean Jill, get your hot ass back to cranking out secretary’s certs. Thx.

By: guest

guest — Wed, 10 Feb 2010 19:04:04 +0000

I meant 23, not 24.
- 28

By: guest

guest — Wed, 10 Feb 2010 19:01:35 +0000

24: all good points and good reasons that I’d rather be at a lockstep firm than where I am (a newly minted “merit-based” system). But given that my firm has decided to hop on the “merit” train, I hope they at least match Orrick’s transparency (they won’t, but I can hope) – it’s better than black-box “merit.”