Associate Bonus Watch 2010, Biglaw, Bonuses, Money, White & Case

Associate Bonus Watch: Which Firms Are Springing Only in New York?

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Let’s all take a deep breath. Associate bonus season, which usually wraps up sometime in January, looks like it’s been extended well into April. This is just more proof that Biglaw firms don’t actually collude. No rational business person would want to be making decisions in April 2011 about how much to pay employees for 2010 performance.

For those trying to keep score, there seem to be the following categories of firms (roughly using a letter-grade system):

A – Firms that are paying Cravath-level spring bonuses in all offices. (Example: Cravath.) [FN1]
B – Firms that are paying Sullivan & Cromwell-level spring bonuses in all offices. (Example: S&C.)
C – Firms that are paying spring bonuses in New York but not elsewhere, like California or D.C.. (Example: Read more below.)
D – Firms that are not paying spring bonuses because their year-end bonuses beat the Cravath year-end bonuses, and they’re hoping their associates can’t add. (Example: CHECK YOU QUINN EMANUEL.)
F – Firms that are not paying spring bonuses and invite disgruntled associates to S some D if they don’t like it. (Example: Jones “We can still hear all the poors who live inside your black box” Day.)

Right now, we want to focus on Group C. Group B gets a pass because they started the spring bonus phenomenon and goddamnit we’re going to respect that. Partners at firms in Groups D & F will have to examine their own motives for why they want their associates to secretly hate them.

But Group C is weird. Why create inter-office jealousy and rage when most top firms are paying spring bonuses in all of their offices? Why look that desperate to save a little bit of money?

And you can’t spell “Weird Cost-Cutting” without White & Case…

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As you know, Gibson Dunn initially toyed with the idea of paying spring bonuses only in New York and screwing everybody else. We have no idea why firms think they can pay associates in other major markets less than New York associates when most national Biglaw firms are not doing that, but the entire plan seems to be based on secrecy.

That’s right — we’re in 2011, and there are firms that think they can pay one group of similarly situated people less than another so long as nobody finds out about it. Good luck with that. Gibson Dunn seemed to abandon the geographic distinction once the word got out.

That strategy might explain what’s going on with White & Case. Yesterday they announced spring bonuses but didn’t actually tell people how much they were paying. Today we’ve received word that there was a separate memo for the New York office that had more details:

Further to the memorandum distributed by the Americas Operations Council earlier today, the Firm will be paying a special spring bonus to our NY Counsel and Associates in the following amounts:

Class of 2010: $ 2,500
Class of 2009: $ 7,500
Class of 2008: $10,000
Class of 2007: $15,000
Class of 2006 and Senior: $20,000

Bonuses will be paid on or about April 29, 2011, and will be paid to Counsel and Associates who remain in good standing and are employed as of that date. Individual bonus amounts for the Class of 2009 and more senior classes will be based on the same criteria used to determine 2010 year-end bonuses, inclusive of customary pro-rations, and will be paid to Counsel and Associates who received bonuses for 2010.

On the behalf the Firm, I thank each of you for your hard work and contributions to our continued success.

Hello, Cravath scale. Surely W&C associates in NYC will be pleased to receive a market-matching bonus.

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But what about White & Case associates in other offices? Now that they know how much New York is getting, won’t they expect commensurate compensation?

We’ve also heard (but haven’t seen a memo or other documentation) indicating that Covington & Burling is trying a similar thing — i.e., paying Cravath-level spring bonuses in New York, but not in D.C. (If you can provide confirmation of this, please email us or text us, 646-820-8477.)

You know, it’s not unheard of for firms to pay a bigger bonus to their New York associates than their associates in L.A., D.C., or Chicago. But in this day and age of information transparency, it’s hard to imagine non-NYC associates calmly accepting their lower-income fate.

How many firms are trying this? Let us know, in the comments or by email, if your firm is trying to limit the spring bonus happiness to New York City.

And might there be justification for paying spring bonuses in New York but not elsewhere? Feel free to debate the issue, in the comments.

[FN1] Some firms that are paying Cravath-level spring bonuses are paying them only to associates who meet certain eligibility criteria (e.g., satisfying the 2010 hours requirement). But these criteria are not geographic in nature; instead, they relate to matters like hours or performance.

Earlier: Prior ATL coverage of bonuses

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