Schulte Roth & Zabel really came up with a creative way to make this terrible bonus season even worse for SRZ associates.
Schulte is matching the Cravath scale, but not all at once. Half of the bonus is being paid now, the other half in March. It’s Schulte’s way of issuing a retention bonus without actually spending any extra money.
It also sets Schulte up nicely to avoid paying spring bonuses next year. Not that Schulte management really cares what people think about them. The firm didn’t pay spring bonuses last year. Even though the firm is making people whole with a “spring bonus” payment to those who should have gotten one last spring, the money is still tied to hitting 2011 hours targets.
It’s really one of the most disingenuous bonus memos we’ve seen. While technically the firm is matching Cravath, it’s doing it in a nickle-and-dime way that makes it pretty clear the Schulte partnership begrudges every last cent they have to pay out in bonuses.
If the associates don’t like it, they know where the door is….
Just because I don’t want Schulte associates to start smashing their computer screens, let’s start with the positives (to the extent there are any) from the Schulte bonuses. You get an extra $10,000 if you hit 2300 hours, and another $10,000 if you hit 2500. Why you would work that hard for partners that clearly hate you is beyond me, but there you go.
Schulte is also giving a stub year bonus to the class of 2011. And the firm is trying to make up for its stubborn refusal to pay spring bonuses last spring with a payment now. Of course, there’s a catch with that:
In Biglaw America, spring bonuses were a way to reward people who worked hard in 2010; at Schulte Roth, spring bonuses are a way to punish those who didn’t hit their hours in 2011.
But that little spring bonus feint is just the first of many “catches” when looking at the Schulte bonus:
Wow. Schulte’s version of a spring bonus in 2012 is to withhold pay from 2011. That makes this whole thing look like less of a bonus, and more of a deferred compensation plan.
But if you think about it, you’ll see the object here isn’t just to be cheap. I mean, the goal of cheapness has clearly been achieved, but there’s more going on here. One of the reasons spring bonuses were popular among top law firms is because they acted like a mid-season retention bonus. Instead of having associates collect their year-end bonus and immediately look for greener pastures, spring bonuses were a low-cost way to keep associates tied to the firm for a little while longer. People who might have otherwise left just had to stay until spring in order to get another “bonus.” And by that time, they could start looking ahead to the year-end bonus, perhaps causing them to stick around for longer.
By splitting the bonus up, Schulte is doing the same thing and banking on the fact that its people are desperate or stupid enough to fall for it. If it’s not insulting to the intelligence of Schulte Roth associates, it’s certainly insulting to their mathematical prowess.
The negative reaction from Schulte associates has been swift and overwhelming:
“Please post on Schulte bullsh*t bonuses.”
“I didn’t think it was possible for me to hate this job more. But I hate. More.”
“Did you guys get the Schulte Roth bonus news yet? Terrible. Paying Cravath’s scale, but giving only half now and half in the spring, so obvi no spring bonus.”
“Schulte just released bonus info and is dicking people yet again. They’re paying in two installments (dec and march) and I have to be employed and not give notice to get the second installment. I really wanted to leave that sh*t hole.”
UPDATE (12:50 PM): As a tipster just informed us, “You guys missed the fact that SRZ isn’t paying out a dime to associates who didn’t hit 2,000 hours (every previous year they’ve given $2500 or $5000). Firm morale has never been lower.”
I don’t want to “blame the victim,” but some of this is your own damn fault, Schulte associates. Nobody told you to work at Schulte Roth. Nobody is forcing you to stay at Schulte Roth. This isn’t the first time the firm has messed around with people’s money, and it won’t be the last. This is what the partnership is like there.
Just look at the Schulte archives on Above the Law. Look at the kind of stories that pop up about the firm. Frankly, this isn’t a place that gives a crap what associates within or without think about the place. The Schulte partnership doesn’t care if every single associate is pissed off about the bonuses. You all showed up to work today, didn’t you? You’re going to be there tomorrow? Well, as long as that continues to happen, Schulte management is going to go to meetings and say “Schulte wins,” and all the partners are going to high five each other.
It stinks to be you guys right now. But if you want out, then get out. Otherwise, enjoy your holiday bonus in March and your spring bonus next winter. Maybe.
(You can read the full Schulte bonus memo by clicking ahead to the next page, or by clicking here.)