We mentioned this massive layoff from across the pond in today's Morning Docket, but it seems like we need to devote a full post discussing the shocking news.
Having already laid off 20 New York litigators, Clifford Chance today let go of 70 - 80 London lawyers. The Lawyer reports:

In a statement, London managing partner Jeremy Sandelson said: "We have not taken this decision lightly. However, like any other business, we have to respond to prevailing market conditions.

Our clients and their legal services needs have undergone significant change over the past year. We need to reflect that in the London office, and that includes ensuring that our level of staffing is appropriate for today's economic realities.

By taking action now, we believe we will be well placed once conditions begin to improve.

Today's information puts yesterday's news about Clifford Chance asking for more capital from their partnership into a larger context. Yesterday, we said:

Associates: next time you complain about greedy partners slashing your pay, consider the possibility that they're suffering too in this economy. They're trying to safely navigate the recessionary shoals, just like the rest of us. Some of the measures they've been taking, like pay freezes and reduced bonuses, may just be prudent planning. Better to have a smaller paycheck than no paycheck at all.

Good luck to our U.K. friends suddenly receiving no paycheck at all.

Clifford Chance to make 80 London lawyers redundant [The Lawyer]

Earlier: Clifford Chance to Partners: Brother, Can You Spare... £100,000?
Nationwide Layoff Watch: Clifford Chance (Redux) Twenty Litigators Laid Off, in NY and DC

The holidays are over. Now it's time to get back to business, and in Biglaw these days that means getting back laying people off.

Multiple tipsters report that there were layoffs at Baker & McKenzie this morning. The firm just confirmed the news:

Therefore, consistent with our strategy and discipline, and in response to the economic conditions we are currently witnessing, we are taking proactive steps to ensure that we remain financially strong. In particular, we are proactively focusing on helping our clients manage through these turbulent times, and we are acting to reduce our own operating costs. These actions include, but are not limited to, slowing or deferring some long-term projects, travel and hiring restrictions, and some limited workforce reductions, including six associates in our New York office this week.

The laid off associates were given a 3 month severance package.

One tipster reports:

No one was safe from first years to senior associates to support staff which were terminated. ... Those who are left are worried about more cuts.

Another tipster, who also claims that some first years were let go, adds this:

The reasons given were that not enough work was available.

Read Baker & McKenzie's full statement after the jump.

Parker Poe, a Charlotte based law firm, laid off 13 attorneys and an undisclosed number of support staffers yesterday.

A firm spokesperson confirmed the news last night:

Parker Poe did, today, separate 13 attorneys from our firm.

The attorneys had less-than-one to 3 years of experience with our firm.

Depending upon their years of service with the Firm they received up to 3 months severance.

At least they waited until after the holidays before they "separated" people from gainful employment.

Read what our tipsters are saying after the jump.

Dickstein Shapiro sent a memo around the firm yesterday that was the bearer of much bad news. Not only did it announce a salary freeze for 2009, it officially announced layoffs that were conducted on Tuesday. Full e-mail after the jump, but here's an excerpt:

First, we have made a limited number of reductions in our associate/counsel ranks. Those affected by this decision were informed yesterday afternoon. These are purely economic decisions--this is a group of talented attorneys who have made valued contributions to our Firm.

Spokespeople at Dickstein have not yet confirmed the number laid off, but sources say it was 10 associates and counsel, all in the D.C. office. [Update:The firm now tells us the ten came from both the D.C. and New York offices.] One source says those laid off were told it was "economic-based"--as opposed to layoffs in 2008 that were ostensibly performance-based--but that the firm did take a look at their hours. The Corporate group was hardest hit.

One of our sources says Dickstein associates were "pissed." The e-mail went around at noon yesterday and "glibly" announced layoffs and the salary freeze. Associates would have preferred a firm-wide meeting to announce the news. They were also annoyed to get the news of the freeze 36 hours before their first 2009 paycheck was to arrive (at 12:01 a.m. tonight).

Additional news about Dickstein is pouring into our inbox. One tipster reports overhearing a partner voice concern about Bernard Madoff paying his legal fees and the firm's ability to take on 2009 associates. More after the jump.

Kirkland & Ellis has asked a number of non-equity partners to leave, multiple sources report. The timing is unclear, but they may have up to six months to pack their things.

The number of laid-off non-equity partners -- or "non-share partners," in K&E parlance -- is believed to hover somewhere between 15 and 25. Some are in litigation and some in corporate, but we understand that all of those let go are in Kirkland's Chicago office.

A tipster points out:

All were told it's because [of] performance, but most were considered fine lawyers and rated with or above their class each year.

Kirkland & Ellis spokespeople did not respond to requests for comment by the time of this posting.

It's important to remember that Kirkland & Ellis has a fairly large class of non-equity or income partners. Kirkland uses the "non-share partner" classification liberally, and they tend to make more lawyers "partners," at earlier stages in their careers. Some K&E "partners" would be senior associates at other firms.

Kirkland also paid out Cravath-level bonuses. When Kirkland announced their bonuses, many commenters opined that bonuses were better then layoffs and that K&E would not do layoffs.

But it looks like Kirkland has had to do some more belt-tightening as the economy continues to tumble. While laying off partners is unusual, it's not unheard of; last fall, Jenner & Block axed 10 partners (both equity and non-equity).

Earlier: Associate Bonus Watch: Kirkland & Ellis Pays Cravath Scale
Prior ATL coverage of layoffs

On Christmas Eve, Mayer Brown announced its bonuses for associates in the New York office. They matched the market-- no surprises there. But our tipster noted that associates at the firm are unsettled by rumors making the rounds of layoffs coming in 2009. Mayer already laid off 33 attorneys, as well as administrative staff in November.

One sentence in the bonus memo has an ominous tone that's making Mayer associates uneasy. The memo says that bonuses will be paid January 16, 2009 but "only to associates in good standing who are employed by the firm on the date the bonus is actually paid." From a Mayer tipster:

People are upset about the language, ("All bonuses will be paid only to associates in good standing who are employed by the Firm on the date the bonus is actually paid.") believing it to reinforce the idea that layoffs are happening come January 5th.

Are Mayer associates overreacting to the memo language?

Firm spokesperson Bob Harris says this is the "same language that has been used for several bonus seasons." We looked back at last year's memo though and didn't see a similar sentence.

UPDATE: Associates are overreacting. Harris points us to a different 2007 memo that does employ the same language.

Harris was emphatic in saying that there are "no plans whatsoever for additional layoffs" at Mayer Brown.

Rumor mongers suggest otherwise. Predictions on the practice groups to be hit with layoffs, after the jump.

It's been a rough month at Reed Smith, as it has been for many a firm. Earlier this month, the firm announced layoffs of 115 people as well as a salary freeze for 2009. We still don't know how many associates there were in that group of 115, but it definitely included associates from the firm's London and U.S. offices.

A tipster tells us that the head of HR Mike Lynch met with the Associates' Committee in the D.C. office recently to address the layoffs and offer some words of comfort about the future of associates at Reed. Some might describe them as cold words of comfort. Here's an excerpt from a memo circulated after the meeting:

*There also have been some attorney layoffs across US offices. Mike Lynch said that the layoff decisions were made based on the results of the annual review process, for which there was a sharper focus this year. He said that hours and revenue underproduction and performance shortcomings were factors, and stressed that the decisions were made carefully, thoughtfully and on an individual basis. Also, there was not one particular office or practice group targeted more than another, although the transactional side recently has been lighter work-wise. Mike did not disclose the number of attorneys laid off, as he feels that information would be meaningless without any context.
*Mike did clarify several times that there are no current plans for future associate layoffs, however he did state that firm management (obviously) does not have a crystal ball and cannot predict the economic environment in the months to come. He said that management is simply going to see how things go and make decisions accordingly.

Lynch did not disclose the number of attorneys laid off, saying that the "information would be meaningless without any context."

In the realm of "making decisions accordingly," the firm issued a warning about a new notation on Reed's year-end salary memos:

*There may be a notation listed in your salary memo, including one that says "First Quarter Review - hours." Mike said that the notation is not intended to frighten anyone who received it, but only to be up front and indicate that things are not static or guaranteed. Management plans on monitoring the hours of those associates, although the notation does not indicate any type of probationary status. For those who received this notation, Mike suggested speaking directly with your PGL about how to proceed effectively.

In a time of slashed bonuses and increasingly common law firm layoffs, it's hard to imagine how an hours warning would fail to frighten someone to near-death. This looks to us like a preparation for a new round of layoffs in early 2009. By instituting the new notation policy on salary memos, Reed has introduced a new way to give negative reviews, and could use it to justify layoffs in the first quarter.

Our tipster knew of just two associates who had received the "FQR-hours" notation-- both had excellent reviews but were low on hours billed. More on Reed, and the disappearance of its "Departures" intranet page, after the jump.

It looks like Thacher Proffitt had a "plan B" in case the King & Spalding negotiations broke down.

We mentioned on Saturday that Sonnenschein was looking into acquiring some Thacher Proffitt lawyers. AmLaw Daily reported:

Within the past week, according to the partner, as King & Spalding neared a deal with Thacher for the structured finance group, it emerged that Sonnenschein Nath & Rosenthal was talking to Thacher lawyers.

Tonight we've got news that Sonnenschein is doing a little more than talking. A Sonnenschein spokesperson reports:

[On Monday morning] We will announce the tremendous addition of 100 lawyers from Thacher Proffitt & Wood.

Happy Holidays!

What a nice present for a bunch of TPW lawyers. On Friday it looked like they'd start 2009 updating resumes, now it looks like they will be making new friends.

Morale is pretty high at Sonnenschein as well. An internal email went around Sonnenschein this evening heralding the news:

With today's move, we dramatically enhance our national and international corporate and finance capabilities, and double the size of our New York office -- both of which have been strategic priorities for Sonnenschein.

These new colleagues accelerate our global growth strategy and reaffirm our continued commitment to client service. In particular, these lawyers bring highly regarded expertise in the fields of structured finance, banking, corporate, real estate and regulatory law. Also joining is a strong and complementary group of litigators, ERISA and employee benefits, and tax lawyers.

Read the full firm-wide email after the jump. We'll update you as more specifics become available.

It's the most wonderful time, of the year.

Update (12:00): The WSJ Law blog is now saying that what is left of TPW will dissolve, and the vote could be happening as early as today. TPW spokespeople could not be reached for immediate comment. Stay tuned ...

Update (12:21): Multiple sources have confirmed that Thacher Proffitt is dissolving today. WARN notifications will be sent around by the end of the day. For continuing coverage, click here.

To balance out word of the robust O'Melveny bonuses, here's some bad news out of California. Earlier this week, Gunderson Dettmer (boy I miss "ad"venture capital) laid off a number of junior associates. As veterans of the heady dot-com days may recall, Gunderson put itself on the map back in 1999 by leading the charge to $125,000 starting salaries.

Gunderson did not respond to multiple requests for comment, made yesterday and today, so we don't have an official number of new people looking for work. But two sources claim that the firm laid off half of its first-year class (five out of ten associates) on Monday, plus an additional but unknown number of more senior attorneys. These layoffs are, according to a tipster, "on top of performance-related attrition / dismissals throughout the fall."

Some of those laid off this week were stub first-years, i.e., class of 2008 from law school. As Chris Rock might say, "here today, gone today."

More after the jump.

We started getting reports this morning that Dechert let go a number of secretaries and legal assistants. But the numbers from our tipsters were low, very low. The Legal Intelligencer just reported that Dechert has in fact laid off an amazing 72 staffers.

A firm spokeswoman confirmed that Dechert has laid off 72 administrative staff across its U.S. offices. She wouldn't get into details about which positions or how many in each office, but said the cuts were basically proportionate across the firm's 11 U.S. offices.

The 72 administrative positions account for about 12.6 percent of the firms 570 U.S. staff members. Dechert has around 1,045 attorneys firmwide and the spokeswoman said there are no plans to cut any more staff or any attorneys based on what they know at this time.

An attorney tipster moves straight to the problem associates at Dechert are all worried about:

[I]t's not like we can have less secretaries unless there are less lawyers...

Dechert has come to the layoff buffet early and often. In October, there was a lot of contention about how many attorneys Dechert has been stealthily getting rid of. At least the staff layoffs are being properly announced.

But then again, Dechert staff also got to feel a little bit of that "Dechert style" on their way out the door. More after the jump.

I've been operating under the assumption that the legal layoff party of 2008 would stop in 2008. My rose colored logic has been simple. I've assumed that Biglaw managers can: A) count, B) add, and C) figure out a sustainable 2009 business model. If those three assumptions are true, I figured that most well managed law firms would be able to get through all of their attorney reductions in 2008 and get themselves into an appropriate position for 2009.

Flawed logic? Perhaps. It's what the shrinks like to call a "coping mechanism."

Of course, in making these assumptions I ignored the possibility that some firms were still using "operation ostrich": a heads down, asses high approach that gleefully exposes tail feathers to the still spinning wheel of economic destruction.

The Legal Intelligencer today warns us that the first quarter of 2009 could see more chopping at firms that are still trying to ride out the storm:

Move over, New York -- it's Philadelphia's time in the hot seat. Legal blog Above the Law was abuzz with reports and rumors Monday that two Philadelphia firms saw associate cuts with one of them laying off staff as well. And according to one consultant, the Pennsylvania market could most likely expect to see more attorney cuts in the new year as firms wait out the holiday season.

After the jump, the new cuts in the new year aren't likely to be localized just to the Philadelphia area.

We received multiple reports this morning that Drinker Biddle & Reath let go of approximately 20 people, all on Friday. Tipsters reported the information this morning, but a morning commenter had the best line:

Yes it's true about DBR - on Friday afternoon. No stealth - they came around to every office - told everyone it was economy based.

Other tipsters confirmed that the dismissals were based on the economy and not associate performance. The firm would not confirm or deny the reports, as a matter of policy.

If true, axing people 13 days before Christmas is a sad sign of the times. Let's hope that firms finish all of their 2008 associate cuts by the end of this week. Surely feelings and families should take precedence over burying layoff news in the holiday news cycle.

And, as always, good luck to all the former Drinker Biddle employees.

Earlier: Prior ATL coverage of law firm layoffs

If you watched any ESPN this weekend, you might have caught SportsCenter's ridiculous coverage of Philadelphia 76ers coach Maurice Cheeks getting fired. Cheeks is the fifth NBA coach to get fired before Christmas (which is a record, apparently) and somebody at ESPN decided that it was appropriate to merge the "bloodbath" of NBA coaches into the larger story about nationwide unemployment numbers.

Therefore, I've decided to hand over the rest of this post to Stephen A. Smith so everybody can learn the latest about another Philly institution (Wolf Block) with the appropriate level of histrionics.

Holla! I got this from a SOURCE last week that Wolf Block was layin' down the smack on 15 cats right before your Christmas or your holidays or WHATEVER YOU WANT TO CALL IT. They got the straight heave-ho yo!

My source tells me that the REDUCTIONS were based on the economics of America, not the performance of their ballers.

After the break, management talks straight.

We received 1,037 responses to last week's ATL / Lateral Link survey on layoffs, which is up a bit from 800 this summer.

As we feared, the number of reported layoffs is also up a bit from this summer:

  * Roughly 11% of associates reported public layoffs at their firms, up from about 4% this summer.

  * 21% accused their firm of "stealth layoffs," up from 18%.

  * 7.5% said that their firm was firing support staff, but not associates, up from 4.5%. (22% of these respondents said that staff attorneys were affected, 45% said paralegals were being cut, and 85% said that other support staff were getting the axe.)

  * In contrast to this summer, when over half of associates felt like things were "just fine", that number has fallen to only 35%.

  * 16% of respondents say that even though layoffs haven't yet hit their firms, they fear that they are on the way.

Survey Responses: Is your firm conducting layoffs?

See who's getting hit where, after the jump.

Last Thursday, we reported that Proskauer Rose laid off 35 associates and 25 staff. At the time, the firm released a statement explaining the need for the cuts:

We are taking these actions in response to the worldwide economic crisis, as well as an unprecedented reduction in our historical lawyer attrition rate, which requires that we align our staffing with current and projected levels of activity on behalf of our clients.

But how often are first-year associates the subjects to "historic attrition?" Not many first years show up for work in September only to leave by December.

But our sources indicate that a number of first-year associates where included in the 35 attorneys Proskauer laid off. A couple of tipsters report that as many as eight first-years lost their job.

We reached out to Proskauer to clarify the number of first-years let go, but the firm declined to comment.

As we understand it, the fired first-years were given a number of reasons for their dismissal. We explore some of them 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.

After the jump ... what does that mean exactly?

On Friday we reported that Epstein Becker & Green might have set the bonus market for regional firms to zero. While associates at firms outside the AmLaw 100 have every reason to worry about receiving any bonus at all, it's worth remembering that the terrible economic conditions are still causing layoffs.

We received word that 8 associates were let go from Pircher, Nichols & Meeks. The firm confirmed the move today:

The Firm laid off a total of 8 of its 75 attorneys, seven in Los Angeles and one in Chicago. One of those laid off was a first year. Four staff members were also laid off. The Firm's practice is concentrated in commercial real estate. Work in this area has declined in the last 6 months and our clients have told us that it is not likely to pick up substantially in 2009. We therefore reluctantly decided that we must reduce the number of our people to match the amount of business we see going forward. We do not anticipate further layoffs. The persons laid off are all fine and competent people and we intend to help them find new positions. Leo Pircher

Letting go of 8 people in a firm of 75 is a deep cut. But there certainly isn't enough commercial real estate work to go around.

It was nice for Mr. Pircher to say that his former employees were fine people, and I'm sure that those former associates will appreciate any help the firm can offer.

The options for lawyers at mid-sized firms keep getting worse. Behind Door #1: $0 Bonus. Behind Door #2: Layoffs. Behind Door #3: Falling on your knees and praying that you didn't inadvertently choose Door #1 or Door #2.

Earlier: Associate Bonus Watch: Epstein Becker & Green Sets Bonuses to Zero

In today's ATL / Lateral Link survey, let's focus on job security, and investigate just how hard the softening economy has been hitting the associates at your firm. As in layoffs.

Last December, we found that roughly 10% of associates were afraid of losing their jobs, and another 12% were afraid for others but not themselves.

In June, we noted that fear had spread, with 28% of associates afraid of losing their own jobs, and another 17% fearing for others' professional lives.

By August, about 30% of survey respondents reported at least some level of involuntary departures at their firms.

And now, even as bonus season kicks in, commenters predict further pain:

"Unfortunately, this morning another top firm fell into the Cravath morass"

This bonus whining (from people who don't get one) is going to look quaint after the January layoff/eval bloodletting.

That seems to be a pretty common sentiment . . . and there are quite a few associates out there whose firms aren't waiting 'til January.

Is the wreckage already too widespread for even Count Layoffula to tally?

Let's find out.

Update: This survey is now closed. Click here to see the results.

--
Justin Bernold is a Director at Lateral Link, the sponsor of this Associate Life Survey.

The latest layoff news comes from Seyfarth Shaw. The firm's Executive Committee sent around a firm-wide email this morning:

As part of our planning for 2009, we have reviewed our staffing in light of market conditions and expected client needs -- for now and for the coming year. While we continue to anticipate a solid 2008, we believe there is a need to exercise prudent business judgment and respond to what economists predict will be a continued challenging economic climate in the year ahead.

One of the decisions we have made has been to reduce legal headcount by approximately 30 attorneys and other time keepers across our offices. We believe this is the best course of action for the Firm in light the economic downturn. These are very difficult decisions to make and, we know, hard news to learn.

It's another classy letter that sends a clear signal to the legal community that former-Seyfarth associates were let go only because of the terrible economic climate that is hurting everyone.

As we understand it, the firm cuts hit the New York, Chicago, Atlanta, and Boston offices.

We don't know if this will have any impact on the long standing rumor of a merger between Seyfarth Shaw and Squire Sanders. But Seyfarth's decision comes just two weeks after Squire Sanders announced layoffs of ... 30 attorneys. Make of that what you will.

Read the full Seyfarth Shaw announcement after the jump.

The bad news continues to roll in, this time from Dewey & LeBoeuf. The firm has confirmed that 12 associates were let go today:

For many of the associates in our Structured Finance Practice, we have already been able to identify other opportunities elsewhere within the firm. Unfortunately, we cannot find work for everyone. Therefore, today we will eliminate 12 positions - 11 in New York and one in Los Angeles. This decision is based solely on the poor conditions in the structured finance market and is not in any way related to the performance of these associates.

Maybe firms are starting to get the message that being upfront with layoff news is preferable to stealth layoffs under the guise of performance reviews. Reed Smith stepped up to the plate yesterday, and Proskauer and now Dewey are hopefully starting the new trend towards honesty when it comes to attorney reductions.

Things are going to get better in 2009, right? I mean, at some point this has to stop.

Read Dewey's full statement after the jump. You can see that the firm is at least doing everything they can to respect work and efforts of the 12 people they let go today.