Biglaw, Bonuses, Money

Catching Up With Cadwalader: Partner Profits, Associate Bonuses, Lawyer Departures, And More

Profits dipped a bit last year, the firm reinstituted a billable-hours requirement for associate bonuses, and lawyer and staff departures are running high in some departments.

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CADWALADER WICKERSHAM & TAFT — MEMORANDUM — NEW BONUS POLICY

From: “Quinn, Pat”
Date: January 29, 2016 at 10:31:47 AM EST
Subject: New Bonus Policy

Dear Colleagues,

As discussed at yesterday’s Firm Committee meeting, we have decided to revise the Firm’s associate and special counsel bonus policy. The new policy is in effect immediately and will be applicable to bonuses to be paid with respect to 2016 performance. It will not impact the bonuses with respect to 2015. The new policy will be included in the Attorney Manual, which is on our intranet, by this afternoon.

The new policy will continue to award bonuses based on an attorney’s overall performance, taking into account quality of legal work, efficiency and productivity, attitude and enthusiasm, and good Firm citizenship (i.e., participation in Firm activities such as pro bono, recruiting, mentoring, training, and business development). The new policy also has a billable hours component, as described below. The inclusion of billable hours thresholds will allow us to better align bonuses with the levels of activity in our various practices.

Based on the foregoing factors, associates and special counsel will be eligible to earn a bonus equal to 50% of the Firm’s announced bonus grid in a particular year if they achieve 1600 billable hours (together with 200 quality non-billable hours) during that year. Attorneys will be eligible to earn a bonus equal to 100% of the Firm’s announced bonus grid if they achieve 1800 billable hours (together with 200 quality non-billable hours).

Additionally, our busiest attorneys will now have an opportunity to earn a bonus that is 20% above our announced bonus grid in a particular year if they achieve 2,200 or more billable hours.

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We believe this new bonus policy is among the most generous in the industry, with billable hours thresholds among the lowest of any major firm that has an hours threshold. These modest hours thresholds are intended to recognize the importance of our attorneys doing high quality work, rather than focusing primarily on quantity. We are also conscious of the fact that the quantity of work is not necessarily in an associate’s or special counsel’s control.

We hope this new bonus structure will continue to encourage attorneys to seek opportunities to do non-billable work, including pro bono, business development, recruiting, mentoring and training. Finally, the new policy is responsive to the desire of some associates for greater clarity of expectations for their performance.

We will continue to invest in your development, and we value your important contributions to the Firm. Thank you as always for your hard work and dedication. Please contact me with any questions.

Pat

The Am Law 100, the Early Numbers: Profits Continue to Slide at Cadwalader [American Lawyer]

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Earlier: Associate Bonus Watch (2015): Without A Billable Hours Requirement, All Associates At This Firm Got Bonuses
Associate Bonus Watch (2014): No Billable Hours Requirement Still Equals High Bonuses At This Firm

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