Back in 2009, when killing lockstep was all the rage, a number of large law firms announced that they would be moving to some form of a merit-based compensation system. Now that we’re a few years into those systems, how many firms have stuck with the plan? And which systems do associates prefer?
Of the 86 distinct Biglaw firms at which survey respondents work, 63% of the firms pay base salaries on a lockstep system, and the remaining 37% of firms use a merit-based system or hybrid-lockstep system for paying base salaries. The vast majority of respondents, 70%, say they prefer the lockstep model for base salaries because of its transparency and predictability.
For year-end bonuses, 70% of the firms utilize a merit-based or hybrid-lockstep system, while 30% have a lockstep system based either on class year or billable hours. According to 62% of respondents, the most preferred type of year-end bonus allocation system is a merit-based or hybrid-lockstep system.
After the jump, find out how various combinations of compensation systems measure up against market.
Among survey respondents who report receiving an above-market total compensation package (salary + year-end bonus), the majority of them – 49% – get paid a lockstep salary and a merit-based/hybrid-lockstep bonus.
According to 53% of respondents who say their firms pay total compensation at the market level, the most popular type of salary and bonus combination is a lockstep salary and a lockstep bonus.
Finally, the most common salary and bonus combination that is likely to get you a below-market total compensation package is a merit-based/hybrid-lockstep salary and a merit-based/hybrid-lockstep bonus, according to 52% of respondents.
This compensation data is brought to you by the experienced recruiters at Lateral Link. If you have questions about seeking new employment opportunities, or would like a professional recruiter to assist you in your job search, contact any of the recruiting professionals recruiting professionals at Lateral Link. Be sure to check out other articles and the firm profiles on the Career Center website for additional job searching resources.