No, Your Office Doesn’t Deserve The ‘NY To 180’ Raise

As “NY to 180” has rapidly morphed into “Everyone to 180” — announced raises hitting D.C., Chicago, Houston, even Wilmington — more and more tipsters are up in arms that a few firms are skimping on their non-New York offices. The biggest uproar arose when Covington & Burling preemptively — and bizarrely — told its D.C. associates that even though it hadn’t yet decided whether or not to raise New York salaries, it was pretty sure the D.C. office wasn’t going to see any bump. As trial balloons go, that was as popular as the Hindenburg.

This memo hit the eyeballs of young associates as anathema in a world where firms are inexplicably paying associates New York money to practice in Richmond, Virginia. But to those taking the long view of the industry, Covington’s statement reflects historical trends.

So, I’ll be the jerk who says it: you don’t deserve New York salaries. Let’s be clear, I’m not saying hardworking associates in these offices don’t deserve raises. I’ll always balk at anyone using New York’s salary scale as a cudgel to depress salaries in other markets. I’m just saying there’s no logical reason for this fad of equalizing salaries across all U.S. offices. That’s some half-baked Thomas Friedman “The World Is Flat” s**t.

Salaries in non-New York markets should be raised… and then New York should get even bigger raises. And no one should feel slighted by that.

1. New York Really Is That Much More Expensive

Our friends from Lateral Link noted this in a column last week about the impact fully equalized wages might have on the New York lateral market. The chart they provide showing the salary required in each market to match the NYC buying power of just $160K is damning. D.C. lawyers want a raise? It took a mere $103,290 for D.C. lawyers to match the $160K a New York lawyer got. To match a New York salary of $180K, D.C. lawyers only need a shade over $116K, meaning they were already paid more than “NY to 180.” Houston is making some big moves — but they matched the buying power of $160K when they got to $69,095.

Obviously, young lawyers can plead that student debt knows no housing market, and that’s certainly why no one is advocating hard-capping associate salary based on New York buying power. But don’t overlook the fact that it’s a lot easier to get a Biglaw job in some of these markets with degrees from cheaper programs because there are respected public law schools in the area. You can take your in-state degree from LSU and secure a Biglaw gig in Houston. You can’t so much take a Penn State-Dickinson law degree and settle into a desk at, say, Milbank.

And, hey, some may argue that this has the upside of encouraging some students to take that scholarship and go to the less prestigious school and come out with less debt. I mean, if you’re going to get $180K wherever you go, why push yourself to gun for that federal clerkship after your tenure as editor of the T14 law review? But maybe the problem of out-of-control law school tuition shouldn’t be handled by sucking talent out of the top.

At the absolute least, firms should be announcing a modifying formula to adjust their new salaries to reflect partial cost of living.

2. New York Works Harder

No disrespect to the work ethic of non-New York lawyers, but, on average, the New York market is working almost criminally longer hours. Firms are dodgy about opening the kimono on billable hours, and that results in long-outdated, barely scientific charts like this one that suggests D.C. associates are billing on par with New York lawyers, and that Chicago and Houston lawyers are working even harder. Balderdash. There are a lot of reasons those New York firms are by and large making so much more money. To some extent, the matters that end up in New York offices tend to be more complex and profitable matters owing to long-standing faith in the quality of New York lawyers and the concentrated hub of experienced partners in NY Biglaw offices. They’re also offices that are heavily leveraged and billing the hell out of those associates. (And even this bad chart reports that NY has more firms averaging 1950 hours than other markets and dollars to donuts those that aren’t hitting that “most reported” number are clocking higher, rather than lower, averages.)

If you’re a young lawyer in some non-NYC market, you may be billing like crazy and think that 2100 hours last year puts you on par with New York lawyers. And it might. But the salary bump is a decision made on balance. On balance, the New York market is billing more — it’s not uncommon to have associates start their annual billables number with a “3” — and moreover, the firms in NY hire people with the expectation that they will all bill these numbers as a rule rather than an exception because there simply are more billable hours to go around. If you’re a go-getter working at a blistering pace in Wilmington, then you may deserve a bonus, and you’ll probably secure that brass ring of partnership, but salary equalization with the most grueling legal market in the country is not where you should seek your remedy.

3. New York Lawyers Are Just Tougher

Need we remind everyone of Buskergate? Get some gumption before asking to be paid what the grownups are making.

Again, I’m all for lifting associate salaries no matter where you live. And I love firm socialism (e.g., lockstep partner compensation for encouraging collaboration and cutting back on inefficient infighting). But paying New York lawyers nominally more than those beyond the Isle of Manhattan is a matter of basic fairness.

Earlier: Biglaw Salary Hike: Not All Offices Are Created Equal
Is NY To $180K Hurting The New York Market?
Why Are D.C. Lawyers Such Frigging Babies?

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Joe Patrice is an editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news.