Biglaw

Sullivan & Cromwell Scales Back Vacation, Caps Overtime Dinners In Leaked Memo

When cutting costs, this Biglaw behemoth took aim at associates.

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Biglaw may be “back” when it comes to offering decent bonuses and then trumping those bonuses. Summer classes have crept up and in one part of the country we have a real-life salary war.

But we can’t escape the gloom and doom from the top of Biglaw as the firms face higher competition and stingier clients. These pressures were bound to manifest somewhere, most likely in the form of some ticky-tack cuts that unfairly burden the associates churning away all night to bring in the revenue that becomes some partner’s luxury retreat in Jackson Hole.

And boy can Sullivan & Cromwell ticky-tack like a boss.

First up, vacation time! Are you happy with your four weeks? Good, because you’re going to end up using all those days working.

Our tipsters tell us that the limit used to be 3 hours. Now adding one more hour may not sound like a big deal, but it really comes into focus when you think of it this way: you wake up in your beachfront hotel room ready to face the day, at 11:30 a.m. your client calls and asks you to review some documents and draft a response. After putting it all together and surviving two rounds of edits, you’re free to go. It’s now 3:15 p.m. Congratulations, you burned a vacation day on this. Wasn’t it relaxing?

It’s startling that this needs to be said, but a half-day is not, in fact, equal to a full-day and if you’re charging a full vacation day for someone working a half-day, you’re doing math wrong.

UPDATE (4:23 p.m.): An important bit of background — while the memo says this cap was “increased,” a tipster explains that the real story is that there used to be no hard-and-fast cap at all.

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This cap may not sound like too onerous, but bear in mind that this is “inclusive of tax and gratuity,” so this is probably a $26-$29 cap. When you remember that Sullivan & Cromwell is located at 125 Broad Street where food options are relatively scarce and those open past 8 ever rarer the burden this places on associates is pretty intense. For s**ts and giggles I checked the menu of a couple late-night restaurants who deliver to S&C. Both options are far from upscale dining (one’s literally a tavern serving bar food) and both charge $22-$29 for entrees. Add a drink and you’re at capacity (and I would always order 3 or 4 drinks if I expected to be pulling an all-nighter). Unless you’re ordering appetizers or the most basic of burgers you’re screwed.

And don’t sleep on the clause: “regardless of any limit imposed by a particular client.” Obviously this provision is necessary because otherwise more generous clients would get stuck with all the bills, but the fact that clients exist who think $35 is an absurd limit should tell the firm something. UPDATE (10/16/2015 8:10 p.m.) Actually, it turns out S&C is actually being cool on this limited point. A few clients imposed slightly lower caps on charged dinners and S&C is offering to pick up the difference to allow everyone to enjoy the same $35 cap. The reason is the same — without uniformity there’s a perverse incentive to order your work to bill some clients over others.

Frankly, giving folks 6 business days following the end of a week is pretty forgiving. Some firms require time submitted within 48 or 72 hours. But this luxury comes with a crushing penalty. It’s hard to imagine a more crushing blow than crawling on hands and knees to the Office Managing Partner to beg for your own paycheck. Way to go S&C, you may actually have found the only punitive measure to actually convince lawyers to punctually enter their time.

Pros: Recognizing Uber as a reliable alternative for the modern lawyer. Cons: A 125 percent surge cap — in Uber-speak 2.25x — seems a bit low. One assumes that the only scenario where a lawyer might want Uber rather than the firm’s official black car vendor is when the vendor is woefully short on vehicles, like during a rain storm. But during a rain storm is precisely the time when surge pricing creeps up to around 2.8x-3.5x meaning the firm won’t cover your Uber at exactly the time you might want an Uber.

Not that I’m faulting S&C on this one — there’s no excuse for making a client pay such a ridiculous surge — but it just feels like this policy may not work out as planned for the lawyers.

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There are more policy changes, mostly positive, in the complete memo. All in all, the memo smacks of the muddled thinking that afflicts any sufficiently large organization. In a world of slimming margins and persnickety clients, the first impulse is to trim gingerly at “waste” as though enough drops in the bucket can become a tidal wave of savings. Unfortunately this gameplan only works for Sorcerer’s Apprentice Mickey. Clients might hate seeing that $40 dinner (a good reason to ditch the caps and stop billing clients for meals altogether — absorb it all into your fees) but what they really hate is the 2-hour team meeting with 6 attorneys updating each other on all the work they already emailed each other about. Cost-cutting can’t be about extras, it has to be a comprehensive transformation of the Biglaw’s decades-in-the-making culture of waste.

In the meantime, if anyone’s looking to get out of law there may be a market for a downtown Manhattan eatery serving $34.99 all-in meals after 8 p.m.

(We asked S&C if they had any additional thoughts or materials regarding their policy changes and they didn’t get back to us. Check out the complete memo on the next page, and find out how to order your cool standing desk!)

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