And that’s basically the only thing our Latham sources can agree upon. Reactions to the LW bonuses varied greatly.
Let’s check out the numbers and see what our sources have to say….
The billable hours requirement for bonuses at Latham is 1900 hours (although it’s not a hard cutoff, and some sources got bonuses despite falling short of it — see below). Here is this year’s Latham & Watkins bonus table (included in the full memo, reprinted on the next page):
A spokesperson for Latham confirmed the accuracy of the table for us.
You’ll notice that the “base” bonuses match the Cravath/market bonus scale. The median Latham bonus amount is a little higher than the base bonus amount, and the top Latham bonus amount is a good deal higher. So one could construe this table as “beating” Cravath. For more detail, check out the table of bonus distributions on the next page.
A majority of our Latham tipsters were happy with the bonuses:
“I was pleased with my bonus. I just barely made my hours and still got an above-market bonus. [Another colleague] didn’t make his hours, but still got a market-level bonus. So, it’s a small sample, but we’re both pleased.”
“Pretty nice, a few reports of bonuses in the $90K+ range for big billers.”
“People seem pleased. Our hours target is 1900 and I got a base bonus despite not hitting it (though I didn’t miss by much).”
One source, who viewed the Latham bonuses as effectively matching Cravath, was on the fence:
“Was hoping they’d beat Cravath, but I can’t complain, I guess!”
Finally, some tipsters were unhappy. For example (we’ve removed specific numbers to preserve anonymity):
“Was expecting more given [my class baseline]. [Several hundred hours above 1900] for [a few thousand extra dollars?] Ouch.”
And one reader was furious. Here’s what this person wrote:
Suffice it to say, people are generally really [angry]…. [A]lthough [the bonus table] looks generous, no explanation is given as to how it is calculated, and people in the senior classes I’ve spoken to in high-margin practices who billed [high hours] still only got about [a few thousand dollars] extra (i.e., well below the median/in the bottom 50%). Unclear what the criteria are for people who got on the top end. Bait-and-switch after all indications were that the firm had had an ‘extraordinary year’ and the other crap they have been sending around as to league table positions in the corporate and finance practices especially.
This alleged transparency is a load of crap: [some of] the highest billers in [corporate] got below the median (which is bizarre)…. People are livid and disheartened at the same time….
I hate this place. Pretends to be “direct” and “transparent” (and markets itself as such), but it is just as murky and passive-aggressive, although in a slightly different way, [compared to other firms]. We’re thinking of a go-slow in protest. Yes, it is “above market” (and the comments will likely reflect “be grateful,” etc.), but when the whole spiel is that they reward hard work, and then don’t, the bait-and-switch is the issue and leads to feelings of betrayal and not being valued….
[T]he morale here is very low (and has even been acknowledged by some senior partners). They go on about wanting to get more people because the workload is unsustainable, but display a distinct lack of empathy with respect to the people they do have.
That’s quite the indictment — but, at the same time, it’s one person’s opinion. As discussed, our LW sources disagreed amongst themselves regarding the generosity (or lack thereof) of the bonuses.
We’ll let you be the judge. Flip to the next page for the full memo, which includes two tables. The first shows the base, median, and top bonuses at the firm, and the second shows the distribution of bonuses by amount and by seniority. What do you think of the Latham bonuses?