Associate Bonus Watch: New York Bonuses Go A Long Way In Texas

Some high-performing associates at this firm received bonuses well above the Davis Polk scale.

A few weeks ago, we requested Biglaw bonus news from Texas. Today we have such news to share with you, courtesy of Vinson & Elkins — a firm with an international platform, but still a bellwether firm in the Lone Star State.

Based on the sources we’ve heard from so far — and yes, sometimes opinion can evolve, as it did with last year’s V&E bonus post — people are very pleased. As one tipster told us, “Senior associate at V&E — received $100K+ bonus. Feeling pretty good about staying in Texas.” This person then helpfully included a link to this cost of living calculator, a reminder that New York money goes far in Houston or Dallas.

And yes, it is New York money, at least for a fair number of V&E associates. In fact, some received bonuses above the NYC scale, as one source said:

I’m a mid-level at Vinson & Elkins, and we just received some pretty stellar bonus news. In addition to matching Davis Polk at our highest bonus level (as expected), they paid substantial supplemental bonuses (20-30% higher than Davis Polk) to “associates who had an extraordinary year in terms of hours and personal performance.” Associates are pretty ecstatic, especially given the current energy climate.

This V&E associate provided a table of the supplemental bonuses, with the Davis Polk amounts indicated parenthetically:

Supplemental bonuses were as follows (all in):

2006 – 120,000 (DP – 100,000)
2007 – 120,000 (DP – 100,000)
2008 – 110,000 (DP – 90,000)
2009 – 100,000 (DP – 80,000)
2010 – 80,000 (DP – 65,000)
2011 – 60,000 (DP – 50,000)
2012 – 32,500 (DP – 25,000)
2013 – 20,000 (DP – 15,000)

But even V&E associates who didn’t get supplemental bonuses seemed to do just fine. As you can see in the full memo, posted on the next page, the median bonuses at Vinson & Elkins were on the Davis Polk scale.

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Note: as set forth in chairman Mark Kelly and managing partner Scott Wulfe’s memo, the chart shows “the median and high U.S. bonus amounts by class year for full-time/full-year associates receiving bonuses.” There is room for game playing in that language. For example, since the chart shows median rather than both median and mean bonuses, it’s possible that the bonuses below the median are dramatically below the median/market (as some allege regarding WilmerHale). In addition, because the chart reflects bonus data “for full-time/full-year associates receiving bonuses,” it doesn’t reveal how many associates got no bonuses.

But let’s not dwell on negative possibilities. So far, all the V&E associates we’ve heard from have been Very Ecstatic.

Congratulations to Vinson & Elkins associates on the nice bonuses. You can read the complete memo — which, interestingly enough, states that “[w]e expect that associate bonuses will continue to become more customized and individualized going forward” — on the next page.

UPDATE (1:30 p.m.): Here are a few more reactions, consistent with what we’ve heard so far:

  • “High billers and high performers are pretty darn happy. I have heard that some associates got bonuses well below the median, but that situation seems to be limited to people with low hours and/or poor performance.”
  • “I just got my bonus letter and am pretty ecstatic…. [I’m a senior associate in Houston, and this is] the fifth straight year I’ve made more than I would make in NYC on the ‘Cravath scale’ (though in prior years, it was usually only a few thousand dollars more – this is a new level entirely). 2014 was a killer year for the firm, and I think the partners deserve some credit for sharing the wealth.”
  • “In New York, if you hit hours (1900), you automatically got the DPW scale. A few outstanding associates (based on hours and work product) received cash in excess of DPW. In Texas, if you hit 2000-2150 hours, you received a bonus less than the DPW scale (more for those who hit above 2150, but still less than DPW). For those who hit 2300 hours (which is a lot of people this year), you received the DPW scale. However, the firm rewarded those who hit at least 2300 hours and were perceived to be doing outstanding work with above market bonuses…. Most people are feeling pretty good around the firm.”
  • “I’m happy to hear the Firm is continuing to seek to award productivity and quality of work (as opposed to merely class level), and am looking forward to continued individualization of our associate comp.”

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UPDATE (1/28/2015, 12:10 p.m.): And here are some less happy sources:

  • “At V&E, the ‘level one’ bonuses (billed between 2000 and 2150) are not even half of the ‘median’ bonuses. They are ranging from 15-25k for 3rd years through 6th years.”
  • “With respect to the V&E bonuses, I’ve got to lodge a dissent. As you partly picked up on, the letter was worded cleverly, but ‘median’ means a different thing when one office (NY) is given lockstep bonuses than when everyone receives ‘individualized’ comp. For the rest of the offices, that means you need to have billed 2300+ just to hit ‘median,’ and something like 2600 to get the marginally higher high end. Folks I’m talking to have mostly billed around 2200 and gotten bonuses that are half or less of the DPW range. General consensus seems to be that V&E pulled off a PR coup by letting the memo leak, letting NY and other higher discretionary bonus offices leak so that you got some pulled quotes, and then burying the Texas office bonuses later in the day. 2300 should not be ‘median’ and someone who billed 2200 should not get a 50k smaller bonus for being 100 hours less.”

(Flip to the next page for the full memo.)


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