The past few weeks have brought a fair amount of news about King & Spalding. Some of it has been good — e.g., adding talent from Orrick. And some of it has been bad — e.g., getting benchslapped (and disqualified from a case) by the Federal Circuit.
This week also brought compensation news to King & Spalding. The information has been a long time coming. Back in February, a K&S source told us:
King & Spalding continues to leave its associates in the dark with respect to 2009 bonuses and 2010 salaries. Back in September we were all demoted one year, and the Atlanta office salaries were slashed by an additional $10k. On top of that, our salaries are frozen and we received no increase on January 1st as we normally receive. Currently 1st, 2nd and 3rd year associates in Atlanta all make the same salary ($135,000). We were told late last year that we would receive bonuses for 2009, but no announcement has been made with respect to the amounts of those bonuses which have typically been paid at the end of February each year.
On Tuesday, associates at the firm received their bonus and salary info. And some of them were pleasantly surprised….
The full memo appears at the end of this post. In terms of the new base salary scale, one source was fairly happy:
My response is actually of pleasant surprise with the firm. We were slow movers to match the market, which has sucked, but my calculation was that because Alston did their paycut/salary freeze several months before King & Spalding did, the partners would drag out their decision on salaries until they saved about the same on associate comp that Alston did. Well, paying it out retroactively flies in the face of that theory, and maintaining 2008 bonus structure allows King & Spalding to edge out the rest of Atlanta-based firms in terms of that.
But the emotional reaction is something like the feeling when Darth Vader, after choking the Imperial Generals with his Dark Side stranglehold, releases them just before they die. The March 2010 payout + bonus resembles a survival of a chokehold much more than a high five.
A second tipster also conducted an Alston & Bird comparison:
It looks like we might still be a little below Alston & Bird here in Atlanta, at least for certain years, but it isn’t completely clear as Alston distributed salaries on an individual basis rather than by memo. At least we know now though, so that is good.
I actually expected them to do exactly what we think Alston did, which was docking the scale by one year across the board. That would have given us a scale of 140, 145, 150, 162, 172, 185, 195, but instead they just took each year and reduced it by $10k so we are now 135, 140, 145, 152, 162, 175, 185, 190. They actually added an 8th year to the scale which we’ve never had before as you are supposed to come up for partner at the end of your 7th year.
A different source expressed some Alston envy, at least in terms of firm culture
Indeed, our local “grass-is-greener” competitor, Alston & Bird, has managed to live up to its reputation as a “better place to work,” simply because King & Spalding makes itself such an easy target. Morale continues to be at an all-time low. Big firms need to have a place for associates that aren’t interested in spilling their blood for partnership, but King & Spalding is the perfect example of NOT being that place. Every associate that isn’t an on-track super-gunner is looking for another place to be. The new school of equity partnership management reinforces the idea that it’s extremely difficult to ever make partner at a place like this, and as a result, many quality associates have taken a hike to greener pastures. You are left with associates that haven’t figured that out yet, and the uber-gunners that King & Spalding one day hopes to populate all of their ranks.
But let’s close on a happy note: bonuses.
On the bonus side, I think everyone is pretty happy. The wording of the memo is a little ambiguous, but we think it means that we are getting paid bonuses based on the scale that was announced back in 2007 which is pretty nice and in some cases more than the Cravath bonus scale other firms are paying this year.
Our bonus system has always been strictly driven by the number of hours you bill, so you get a flat bonus for hitting 2,050 (nothing below that) and a variable bonus for each hour over 2,050. There are some associates that billed a lot more than 2,050 hours last year that should get some comparatively large bonuses.
If you’d like to get into the nitty gritty, check out the full memo below.
P.S. Said one of our sources: “Would love to see more of ATL (the city) on ATL (the blog). It’s a pretty unique legal environment.”
Attorney Ethics: Disqualifying a Law Firm [Patently-O]
King & Spalding Gets Another Partner from Orrick [The BLT: Blog of the Legal Times]
King & Spalding Lands Three Litigation Partners from Orrick [The BLT: Blog of the Legal Times]
KING & SPALDING — MEMORANDUM — 2009 BONUS AND 2010 SALARY INFORMATION