Williams Mullen, the large and prominent Virginia-based law firm, announced yesterday that it will be cutting associate salaries by 7.5 percent, effective in January 2010. The new starting salary for associates will be $117,000 (in all offices other than D.C.).
A firm spokesperson described this as “a business decision,” made to remain competitive in a rapidly changing market. She added that the Williams Mullen cut was comparable to steps taken by similar firms, including Hunton & Williams and McGuire Woods (which cut starting salaries for associates by 10 percent). [FN1]
“Our clients are saying, ‘You better do this,’” the Williams Mullen spokesperson said. “This is a market adjustment just like any other adjustment, just like any other business adjusting the cost of its product.” If the firm were to keep associate salaries the same in this economic environment, “our clients would look at us and say, ‘You’re no longer competitive.” She added that equity partners would also see a decline in their incomes due to market realities.
As for whether this cut might be revisited at a later date, the spokesperson noted that matching the market goes both ways. “You can adjust down, and you can adjust up,” she said. “When things start to get better, we’ll look at ways to adjust accordingly.”
[FN1] UPDATE: A point of clarification about McGuireWoods: although the firm did cut starting salaries, incoming associates at the firm are still earning more than $117,000. New hires are making $144,000 in Northern Virginia, D.C., Los Angeles, Chicago, and New York, while new hires in Richmond, Charlotte and Atlanta are making $130,500.
Earlier: Prior coverage of associate pay cuts