First years to 100K and an “apprenticeship”?
In the past two months, we’ve reported on three firms instituting an apprenticeship model for first year associates: Drinker Biddle, Howrey, and Frost Brown Todd. “Apprentices” start at the firm at a lower salary and are not billed out to clients, billed out at a lower rate than normal associates, or billed out for lower total hours. It sounds like an apprentice is a “paralegal plus.” Of course, that “plus” includes a J.D. and its accompanying law school debt.
Still, when we polled you last week, almost 70% of ATL readers who voted said they were in favor of Howrey’s $100K-plus-professional-training apprenticeship.
The National Law Journal (subscription) has an extensive piece on apprenticeships (noting two other firms that have instituted the practice — labor firm Ford & Harrison and Dallas’s Strasburger & Price):
These firms are putting new recruits through additional apprenticeship programs that they say will better train their attorneys for life at a law firm and for handling clients. Think of it as the equivalent of a medical residency, only with suits instead of scrubs.
The latest — and so far largest — firm to move to an apprenticeship model, 659-lawyer Howrey, announced its program last week. Starting next year, first-years at the firm will get a pay cut — from $160,000 to $100,000 in base pay plus a $25,000 bonus to pay down law school loans — and they’ll spend a good portion of their time attending classes with partners and shadowing them on client matters. The apprenticeship period will last two years.
Are law students really like medical students, in need of on-the-job training in order to operate in the real world? If apprenticeships become widespread — which admittedly seems unlikely once the tough economic times are behind us — should the training at a firm mean one less year in law school? Firm salaries are going down, but law school tuition is going up. Maybe it’s time to rebalance.
A round-up of the salaries for BigLaw apprentices, and a poll on how law schools should be reacting to deflating salaries, after the jump.
Welcome to the future. Like Drinker Biddle did in May, Howrey is changing the nature of the first and second year associate experience. The firm is moving to more of an apprenticeship model. New Howrey associates will receive an emphasis on training and take a significant reduction in salary.
The memo from Howrey explains some of the top-line goals of the new program — called the “Tier 1 Associate Program.”
Participants in Howrey’s Tier 1 Program will spend only one-third of their time during the first year on client billable work to permit them to devote the remainder of their time to pro bono representations and a wide range of training programs, including the firm’s signature professional development experience – the Howrey Academies. In Year One, associates will work with Howrey’s full-time, in-house writing instructor, be assigned to trial teams, and take advantage of other programs offered by Howrey’s award-winning professional development team. They will dedicate approximately one-third of their time to pro bono and public interest matters, which will afford them the opportunity to develop the advocacy skills and in court experience that are central to Howrey’s practice. The emphasis on training will continue into Year Two, with client secondments, judicial externships, and other advanced development opportunities added to the curriculum. Billable hours in the second year will be capped at roughly half of total hours.
That is the good, here is the salary information:
The Tier 1 program will be limited to a select number of associates each year. Compensation during the first two years will be adjusted to reflect the nature of the program and the dramatically reduced billable hours expectations. In addition to an annual salary of $100,000, first year participants will receive $25,000 upon acceptance of their job offer to help defray their law school loans or third year law school expenses. In their second year at the firm, participants will receive an annual salary of $125,000 and a $25,000 bonus upon successful completion of the program and entry into Tier 2 of Howrey’s associate development program. Higher compensation may be offered to candidates with special qualifications, such as advanced technical degrees or clerkships.
At least Howrey is trying. More details and the full memo and a reader poll after the jump.
The ATL inbox has been buzzing with layoff news about Howrey. Could it be that another firm that recently picked up a bunch of partners from a dissolved firm could be laying people off? Would former-Thelen chief Stephen O’Neal’s new firm cut associates so soon after his arrival?
Today, a firm spokesperson told us:
As we have stated on several occasions, unlike many firms, Howrey is not laying off lawyers or staff.
As in every year, there is an outplacement of some associates based on performance issues. This year, as in previous years, this involves approximately ten associates and occurs only after an exhaustive evaluation process and review. The information that you received is incorrect and has mischaracterized this as layoffs.
Howrey is enjoying a strong year. You should also note that unlike many other firms, we are not rescinding or delaying offers to first years. Our Associate Development program remains robust and on track.
The Recorder is reporting that Howrey will take on 40 lawyers from Thelen’s prestigious San Francisco construction practice:
The group — which Howrey characterized as “most of the construction practice” from Thelen — includes Thelen Chairman Stephen O’Neal, construction practice head John Heisse II, D.C. office managing partner Andrew Ness, San Francisco partner David Buoncristiani (who handles matters for client Bechtel), Los Angeles partner Robert Thum and D.C. partner David Dekker. Most of the 18 partners and about 25 associates and of counsel are in San Francisco and D.C., and the rest are in New York and Los Angeles.
Hmm… Thelen attorneys, Chairman Stephen O’Neal, Howrey — where have I heard that before?
Oh yeah! You’ll remember that the Recorder initially broke the story on O’Neal’s flirtations with Howrey.
Immediately after Thelen dissolved, we mentioned possible options for the firm:
Option 1 is the plan they have arguably been pursuing: breaking up the firm practice group by practice group to interested parties. As we reported yesterday, this is the best option to save associate jobs. However, that plan is dependent on Thelen’s banks signing-off on the plan and maintaining their line of credit. Did Stephen O’Neal’s aggressive and ultimately public pursuit of his own lifeboat at Howrey scuttle that option? Once everybody is told that the managing partner could be leaving in ten days, why would other potential suitors compete for full Thelen practice groups? Instead, it’s easier to wait for an official dissolution and cherry-pick the rainmakers. This is what happened to Heller.
I’ll pause until the Thelen people stop screaming and hitting things.
Read about other Thelen landing places, after the jump.
The Vault 100 march continues! In this series of open threads, we list the firms, and you all discuss their upsides and downsides. We’ll be wrapping this puppy up this week.
Here are the next ten (with prestige scores in parentheses):
Usually, we have fun with the “notable perks” chosen by Vault. But as we move down the list, the perks are becoming distinctly less notable — e.g., gym membership discounts, free parking, and “good views.” Oh well.
You know what to do! Have at it in the comments. Earlier:Vault 100 Open Threads – 2009
Coming soon to a theater near you: Howrey LLP: The Movie?
Late last week, several readers here in Washington reported unusual activity at the Howrey offices:
“Howrey is doing a film shoot in the lobby of its DC office… Multiracial attorneys in suits everywhere… Looks serious.”
“I was in the building where Howrey’s DC offices are today. There was some filming with a lot what seemed to be Howrey attorneys. At one point, a large group ran through some doors, talking on their cell phones. Hopefully, it’ll provide something entertaining to watch on YouTube….”
As long as they don’t take it down as soon as they put it up (or we link to it).
One tipster decided to do a little reporting:
“A few minutes ago, I walked through my building’s lobby to go out and get lunch. On the way, I was surprised to find the lobby lit up like a movie set. A few dozen young folks in suits — many of them holding cell phones — stood in a big group, listening to some guy shouting some directions. I chatted up the security guard at the front desk, who told me that Howrey was shooting a commercial.”
“From what I can tell, the whole scene will make for a fairly lame ad: ‘Hire Howrey — we stand around in suits, smiling and cell-phoning.’ Perhaps the worst-case scenario would be Howrey trying to play off of the Verizon cast-of-thousands ads….”
“On my way back, I noticed that they have stacks of life-sized photos of people up against the wall. Maybe they decided to replace their associates with cardboard stiffs? (Some would say that, at Howrey, they did that years ago.)”
We contacted Howrey for comment — about the filming, not the extent to which they staff matters with cardboard stiffs — but they did not get back to us.
As you may recall from our prior coverage, in posts titled Howrey Is Planning Something Weird and More About the Howrey Weirdness, the law firm of Howrey LLP was planning to ditch lockstep compensation for its associates — in favor of something weird (or innovative, or both).
Starting in 2008, Howrey was going to employ a “competency model,” in which it would “determine salary based on individual evaluations and various forms of progress indicators.” At least that was the plan.
Consider the plan on hold, or at least put off for a while. Sources at Howrey advise us that at a meeting of the Associate Affairs Committee today, it was announced that the new, non-lockstep compensation system will not be implemented until at least 2009. In other words, Howrey will keep a lockstep pay scale through 2008.
It’s still planning to move in the direction of a new pay paradigm. The associate evaluation system upon which the new compensation will be based is going to be rolled out in 2008. But evaluations under that system won’t affect associate paychecks until 2009, at the earliest.
Why the postponement? A source tells us, “apparently the delayed implementation is a result of concerns voiced by associates to the firm’s outside consultants during focus group sessions about the new system.”
That’s nice. Who says partners don’t listen to associates? Update: Or, as one commenter puts it, “they have been listening to those comments in exit interviews as Howrey hemorrhages associates who are terrified of a compensation structure based on an inadequate performance review system.” Earlier: Nationwide Pay Raise Watch: More About the Howrey Weirdness Nationwide Pay Raise Watch: Howrey Is Planning Something Weird
Back on Wednesday, we reported that Howrey LLP plans to chuck lockstep compensation for its associates. Starting in 2008, the firm will employ a “competency model,” in which it would “determine salary based on individual evaluations and various forms of progress indicators.”
Today our scoop was picked up by The Recorder (and then by the WSJ Law Blog). From The Recorder:
In a radical departure from the status quo, Howrey is getting rid of lockstep compensation for its associates….
While Howrey first-years will start at the market rate — the firm recently raised them to $160,000 — all other associates will advance through different levels based on personal evaluations instead of seniority. Each level has a salary range, and [partner Henry] Bunsow said top performers would be paid more than market, while some could make less.
“The goal is not to have associates make less than their counterparts at other firms,” Bunsow said. “If poor performers can get a better deal somewhere else, that may be a marketplace reality — we would hope that this system wouldn’t promote that.”
“The goal is not to have associates make less than their counterparts at other firms” — sounds a bit defensive, but whatever.
This system will be highly customized, but complicated:
The evaluations will be based on performance and experience, which could shorten the partnership track for some and lengthen it for others. Since Howrey is a litigation-focused firm, factors like writing, deposition, trial practice and client presentation skills will be considered, Bunsow said. Although there will be bonuses based on hours, that will be just one of many considerations in the evaluation, he added….
Associates will be assigned to partners who will be responsible for their development and their individual evaluations. A full-time staff person will be hired to oversee the program and to make sure that associates feel they are being treated fairly, Bunsow said.
Okay, we’re getting a headache. This sounds like the brainchild of a Soviet bureaucrat.
And this is just the simplified version. If you’re interested in the dirty details, an internal Howrey email — which includes mention of a “Competency Czar” — appears after the jump.
Hey, have you read Above the Law for like one single minute in the past month? If so, you probably know that we’re having this big blogger conference on March 14th at the Yale Club. Yeah, the Yale Club. You’ll be able to recognize me: I’ll be the only big… blogger guy surreptitiously holding a can of crimson spray-paint.
Speaking of coming, you should come. We’ve got CLE and all that. Click here to buy tickets to get CLE credit for listening to bloggers scream about stuff on the internet.
To refresh your memory, details on the panel that I’m moderating — almost entirely sober, mind you — follow.
My panel is called Blogs as Agents of Change, and we’re going to talk about whether all of these spilled pixels are actually making a difference. You know my view… just ask Lawrence Mitchell, but here are the panelists:
So you spent a considerable amount of time courting, selling and maybe even doing some friendly stalking of that attractive lateral partner candidate with a sizable book. After he or she ignored your emails and didn’t return your calls, a few weeks go by and you read a press release in the legal media announcing the recent move to a competing firm.
Rats. Another one got away from you. You cringe when you consider how much time was spent in meetings that did not bear fruit. Your heart aches when recall how you were led to believe this was a marriage made in heaven.
You have been rejected.
The sting of rejection is painful, even for fancy law firms. But you need to find a way that you can turn this disappointment into a legitimate learning experience.
No, this isn’t a pre-party before we come back next fall for the real thing. This IS the real thing. Quinn Emanuel is pushing the envelope on recruiting. The party is now. This is when you meet the partners and associates face to face. This is when we begin the dance that could land you an offer for your second summer BEFORE school starts in the fall.
First: You come to the party. Second: If you like us, you send your resume after June 1, 2014. Third: If we like each other, you get an offer.
We’re not waiting for fall. We’re not doing the twenty minute thing. This party is the real thing!
We hope you’ll join us, and look forward to meeting you.
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