Money

100 dollar bill Abovethelaw Above the Law law firm salary legal blog legal tabloid Above the Law.JPGThis question gets debated endlessly in the comments here at ATL. Readers argue about real estate prices, billable hour requirements, and the cost of a round of drinks in different cities. Sadly, there’s often a lack of hard data in these disputes.
Well, now we have some real information, courtesy of the National Law Journal:

It may be a stretch to argue that beginning lawyers at big law firms need more money, but those practicing in New York could make a strong case for a raise….

Several big law firms in the last few weeks have boosted salaries for first-year associates in large cities in the West to match the $160,000 that their New York beginners receive.

A “nationalization” of their practices is the reason many firms give for paying the same amounts in different locations. But a look at the cost-of-living differentials shows that the copycat compensation is creating some significant pay disparities among associate ranks.

Discussion continues after the jump.

double red triangle arrows Continue reading “Nationwide Pay Raise Watch: Is New York Worth It?”

Simpson Thacher Bartlett LLP Abovethelaw Above the Law blog.jpgWhen we debunked the Simpson Thacher raise rumor earlier today, it was based on information from associates who work at the firm. But now, straight from the horse’s mouth, we have comment from a Simpson partner.
Corporate partner James D. Cross is co-chair of the firm’s personnel committee. We emailed him about the raise rumor, and he kindly gave us this response (reprinted with his permission):

Dear David,

Thanks for the inquiry. You’re right: we’re not currently considering an increase in associate salaries. Best regards,

James

Mr. Cross’s wording is interesting: the firm is “not currently considering” a pay raise.
How should this language be interpreted? Does it mean that Simpson, which kicked off the last round of New York pay raises back in January, wants someone else to lead the way next time around? Or will Simpson, along with the other NYC Biglaw shops, just pay especially generous bonuses this year?
If you’d like to take a stab at parsing James Cross’s statement, please do so in the comments. Thanks.
Update: The commenters who point out that we should have included our original message to Mr. Cross make a very good point. We now reprint our message to him, after the jump.

double red triangle arrows Continue reading “Nationwide Pay Raise Watch: Official Comment from Simpson”

Phoenix Arizona Abovethelaw Above the Law blog.jpgToday our tour of non-mega-markets swings through the American Southwest. Say hello to Phoenix!
This article is a bit dated, but still informative and generally accurate. From the Business Journal:

Phoenix-area law firms face a major hurdle in recruiting top legal talent: They do not offer starting salaries as high as those found in California, on the East Coast, or in other established commercial centers.

That’s making it tough for Phoenix firms to recruit top professionals to support the Valley’s growth. An entry-level attorney for a top Phoenix law firm is earning an average of $110,000 a year….

That figure trails entry-level pay in traditional legal metros such as New York, Los Angeles, San Francisco, Washington and Chicago.

Additional discussion, plus a collection of data points assembled by a helpful tipster, after the jump.

double red triangle arrows Continue reading “Nationwide Pay Raise Watch: Phoenix”

Simpson Thacher Bartlett LLP Abovethelaw Above the Law blog.jpgWe’ve checked with our sources at Simpson Thacher & Bartlett. And we hate to be the bearers of bad news, but the rumor that Simpson has raised starting salaries for its associates to $190,000 is UNTRUE. The “memo” that has been making the rounds is a fake.
So y’all can stop emailing us about this now. Thanks.
(But if you haven’t done so already, feel free to vote in our reader poll, concerning whether top New York law firms will raise salaries again before the end of the year. We’ll keep it open for a little while longer.)
Update: Comment on the rumor from Simpson partner James Cross is available here.
Earlier: ATL Reader Poll: WWNYD?

Boston Massachusetts Statehouse State House Abovethelaw Above the Law.jpgSome of these Boston pay raises have been previously reported in these pages, but some are new. From this morning’s National Law Journal (subscription):

A second wave of associate salary increases is sweeping the Boston legal market with several firms boosting first-year pay to $160,000 for the incoming September class.

At Bingham McCutchen, DLA Piper, McDermott Will & Emery and Wilmer Cutler Pickering Hale and Dorr, along with Boston-based Foley Hoag, compensation is $160,000 for the Boston September class and firmwide in some cases.

Ropes & Gray raised salaries to $160,000 on May 1 and Goodwin Procter did the same on June 1. First-year starting salaries are now also $160,000 at Choate Hall & Stewart….

[Earlier this year,] Boston’s Fish & Richardson and three [Boston offices of] New York firms jumped to $160,000: Proskauer Rose; Skadden, Arps, Slate, Meagher & Flom; and Weil, Gotshal & Manges.

If you’re looking to discuss Boston associate salaries, please do so in the comments. Thanks.
P.S. Since we cover the Boston legal market a fair amount here at ATL, this post won’t count as our “Secondary Legal Market of the Day” post. That post will appear sometime in the afternoon.
More Boston firms follow the lead on associate pay [National Law Journal (subscription)]
Augustana – Boston [YouTube]

Williams Connolly LLP Abovethelaw Above the Law blog.JPGWe recently asked for information about compensation developments at Williams & Connolly. We haven’t heard anything about base salary increases; but we do have information about two other topics.
First, we’ve confirmed that the firm’s clerkship bonus currently stands at $25,000. If you do a district and circuit clerkship, you get $50,000.
Second, on Tuesday of this week, summer associate pay at W&C was raised to $3100 a week, retroactive to whenever the summers started. The information was conveyed orally (so no memo). From a summer: “While most of us were not overly concerned about the previous differential, the raise is definitely a nice and welcome gesture.”
Earlier: Nationwide Pay Raise Watch: What’s Up With Williams & Connolly?

We’re signing off for a while, to go to a lunch meeting. So you won’t be hearing from us for a little while.
If any big salary developments occur while we’re gone — yes, we’ve seen the Simpson Thacher “memo,” very cute, guys — please post them in the comments. And feel free to discuss any breaking non-compensation news, too.
See you later in the afternoon. Thanks!

Sopranos The Sopranos New Jersey Abovethelaw Above the Law blog.jpgIn our tour of the nation’s secondary (and we don’t mean that in a bad way) legal markets, we’ve previously hit Denver, Hartford, Philadelphia, and Seattle. Now we return to the East Coast, with a shout-out to our home state: New Jersey!
From the New Jersey Law Journal:

New Jersey’s large firms are hiring larger classes of new associates and boosting first-year salaries by more than 10 percent, a Law Journal survey finds.

Salaries this fall at a sampling of 21 firms will range from $95,000 to $130,000 and hires are up 19 percent, to 157 from 131 last year. The largest New Jersey-based firms will pay $120,000 to $125,000.

Firms interviewed say their hands were forced by a wave of increases by New York firms that began Jan. 22 when Simpson Thacher & Bartlett pushed its starting salary to $160,000. Since then, other firms in New York and Philadelphia have elbowed up to $145,000 or higher.

There are many advantages to practicing law in New Jersey. Salaries are still relatively high, but billable hours (and taxes) are lower than in New York. At the same time, you’re very close to New York and Philadelphia, and all the great things — art and culture, restaurants, entertainment — that those cities have to offer.
But still, there is a sizable difference between $125,000, the standard at the biggest Garden State firms, and the $160,000 you can get on the other side of the river. And some say that the advantages that NJ firms enjoy over NYC firms, in terms of lifestyle and hours, aren’t as big as they used to be.
Please discuss these and other NJ-related associate compensation matters, in the comments. Thanks.
N.J. Firms Hike First-Year Pay, Bulk Up on New Hires [New Jersey Law Journal]
Related: Open threads focused on Denver, Hartford, Philadelphia, Seattle, Phoenix, Atlanta.

Bingham McCutchen 2 Abovethelaw Above the Law blog.jpgYesterday we asked: “What’s Up With Bingham McCutchen?”
Associate salaries, that’s what. Last night, Bingham McCutchen sent around an email announcing that it “will be increasing 2007 base compensation in our domestic U.S. offices to match the base compensation structure in our New York office, consistent with the new national market.” The raise is retroactive to June 1.
That’s the good news. And the bad news?
Well, just check out this interesting (but depressing) article from The Recorder. The upshot: the litigation department is slow at Bingham, and the firm is offering buyouts to associates to leave.
We’ll probably do a more detailed write-up about the Bingham buyouts in a later post. If you have some information to share about the situation, please email us (subject line: “Bingham McCutchen”).
The Bingham pay raise memo, verified by multiple sources at the firm, appears after the jump.

double red triangle arrows Continue reading “Nationwide Pay Raise Watch: Good News (and Bad) from Bingham McCutchen”

Stroock Stroock Lavan LLP Above the Law blog.JPGA few more news items concerning associate compensation:

1. Stroock & Stroock & Lavan: Multiple sources confirm that they’ve raised salaries in their Los Angeles office. Effective date of June 1; no changes to the bonus structure. The new scale is 160-170-185-195, plus discretionary raises for year 5 and above, who previously were at $200K plus discretionary raises (small, usually $5K a year).

In addition, we’ve learned that the firm pays associates 10 percent of any business they bring in. Do other large law firms have similar policies? Feel free to discuss in the comments.

2. Sonnenschein Nath & Rosenthal LLP: We haven’t confirmed this (and their NALP form doesn’t reflect it). But according to a memo posted in the comments, the firm is “increasing starting salaries in our Chicago, Los Angeles, San Francisco, Silicon Valley and Washington, DC offices to $160,000. We will be adjusting salaries for all other associate classes in these offices effective July 1, 2007 to take into account the increase in the starting salary.”

3. Reed Smith LLP: Also not confirmed. But according to a memo posted in the comments, the firm “ha[s] decided to increase our starting salary for first year associates in California, Chicago, and Washington, D.C. to $160,000 effective January 1, 2008. In addition, we will accelerate to January 1, 2008 the implementation of the previously announced increase to $145,000 in Philadelphia/Wilmington.”

The firm has also made changes to its bonus program: “In addition to the current bonus thresholds, we will make further payments of $5,000 at each of 2000 and 2100 chargeable hours and $10,000 at 2300 chargeable hours. This means, for example, that associates with 2300 chargeable hours for 2007 will earn additional bonuses of $20,000.”

If you can confirm the Sonnenschein or Reed Smith news, or if you have additional info to share, please drop us a line. Thanks.

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