On Friday we noted that Gibson Dunn associates can read. Today it looks like management at Gibson Dunn finally acknowledged the writing on the wall. After a year of record-setting profits, Gibson Dunn finally decided to match the spring bonus market. The firm will be paying Cravath-level spring bonuses to eligible associates, on April 29.
Welcome to the club, Gibson Dunn. Just think, Sidley Austin, this is going to be you in a couple of weeks, when you finally realize that the cost of being viewed as a cheap firm that doesn’t pay market compensation to its associates far outweighs whatever profits you’re hoarding by hanging on to the extra money it would cost to award spring bonuses.
Obviously, our Gibson tipsters feel vindicated, now that GDC finally matched the market…
Some Gibson Dunn associates are thanking our coverage for the firm’s changed position:
The word is that they cracked under ATL pressure. You guys are creating the market =).
Well, to be fair, Cravath, Sullivan & Cromwell, and other top law firms are creating the market. We’re just reporting on the market that has already been created.
And that’s perhaps where firms that are late in coming to market make their mistakes. Associates know what associates at other firms are making. And so associates know when they are being underpaid. It’s one thing for a firm to secretly want to pay its associates as little as possible, but it’s not smart to assume that associates are going to somehow remain clueless as to what the market is paying.
If you are going to lowball your people, they are going to find out, and they’re going to feel bad about it. Their friends are going to make them feel stupid for working at “that one firm that won’t make market compensation.” I just don’t understand why a firm would want to make its employees feel bad and stupid for working for them.
But any Gibson Dunn associate today will tell you, “Better late than never.” Who knows why Gibson made them wait, but the firm has finally announced, and GDC associates will be getting their money at the end of April, just like the other top-tier associates out there. Read the full memo below.
Aside from Sidley, is there any other firm that claims to pay market compensation that is most clearly not doing so?
GIBSON DUNN — MEMORANDUM — SPRING BONUSES
To: US Associates and Of Counsel
Subject: Supplemental Bonuses
From: The Management Committee
Date: April 5, 2011
We are pleased to advise you that the firm will pay a supplemental bonus to US associates and Of Counsel in good standing who remain actively employed on the payment date. The supplemental bonuses are in the following amounts, but are subject to equitable adjustment to reflect the criteria used in determining 2010 year-end bonuses:
Class of 2010: $ 2,500
Class of 2009: $ 7,500
Class of 2008: $10,000
Class of 2007: $15,000
Class of 2006+: $20,000
Of Counsel: $20,000
The bonuses will be paid on April 29, 2011 to eligible associates and Of Counsel and will be subject to normal prorations consistent with the methodology used in determining 2010 bonuses.
We very much appreciate all of your extraordinary efforts on behalf of our clients. Our strong results last year were attributable in no small part to your hard work. We are very grateful for your continued dedication.