We are going to need to continue to be extremely circumspect in making new partners … In an environment in which net income is falling and the point is falling, point dilution compounds the negative impact.
The sentiment is so perfectly focused on the ultimate bottom line. Effort, talent, commitment, paying your dues? Bah! When the chips are down and people are getting squeezed, “point dilution compounds the negative impact.” It’s a business, don’t let anybody tell you otherwise.
So really, I’m not at all surprised about the latest news coming out of Cravath. Am Law Daily reports:
And now the year’s grand finale: Cravath, Swaine & Moore has just confirmed that it will be making no new partners. That’s right: Zero.
It’s always been notoriously hard to break into the partnership at Cravath, but we can’t remember the last time the firm completely nailed shut the doors to its innermost sanctum (nor could Cravath, or at least the firm declined to say). The firm made three partners in both 2007 and 2008. Could it be that the economic meltdown has hit Cravath harder than other firms?
Of course, according to Cravath, these high level business concerns didn’t play a part in the firm’s decision to not make any new partners. Instead, it appears that everybody that was up for partner this year just kind of stunk.
Details after the jump.
There has been a lot of talk about DLA Piper’s new merit based compensation structure, and a lot of that talk has not been pleasant. Associates are pretty bummed that they’ll be starting at $145,000 with 15% of that salary deferred until the end of the year if they hit their performance marks. We noted those concerns earlier this month.
But there is a memo going around the offices of DLA Piper. It appears to be unsigned, but tipsters report that the memo is something that DLA management put together. It offers a very different viewpoint on the new DLA structure.
Whoever made the memo, it’s a full-throated defense of the firm’s decisions. Let’s take a look after the jump.
* It’s beginning to look a lot like … what? We’re still working? The whole team? Oh all right. [ABC News]
* Gatesgate 2: The Prequel. [Courthouse News Service]
* Yes, to your friend, Forbes Magazine, you will listen about the wisdom of applying to law school. [Forbes]
* An exodus from Dickstein Shapiro to Kasowitz. [Am Law Daily]
* Mexico City has legalized same sex marriage. Kind of makes America look like a theocracy. [WSJ Law Blog]
* Microsoft is probably having its worst Christmas ever. [Bloomberg]
Yesterday was a big news day over at Quinn Emanuel. In the morning, the firm announced its new partners; in the afternoon, the firm announced its associate bonuses.
Let’s start with the bonuses. Here are the criteria, from the firm-wide email sent by Richard Schirtzer (described in his bio as “one of the most successful big-case lawyers in California”):
Associates who have been with us since mid-August 2009, or before, and who either billed or were on target to bill at least 2000 hours for the year will receive a bonus. In calculating hours, full credit was given to time spent on collection and E & O matters, and up to 100 hours of credit was given for time spent on pro bono and/or AAIT matters.
For associates who started between January and mid-August, your hours were annualized and you will receive a pro-rated bonus based on the hours milestone you would have reached had you worked at that pace for a full year. The schedule we used to calculate bonuses is set forth below.
The bonus schedule — plus the Quinn Emanuel new partner announcement, and analysis thereof — after the jump.
* What’s the difference between Senator Ben Nelson and a terrorist? The terrorist has principles. [Commentary]
* At some point, Obama is really going to have to stop being such an a$$**** when it comes to gay rights. [Crime & Federalism]
* The Fighting Sioux lawsuit got tossed. [Indian Country Today]
* UC Hastings has a new law dean. [Tax Prof Blog]
* Meanwhile, a 50% tuition scholarship for all three years at UC Irvine should keep well credentialed 1Ls flowing into the institution. [WSJ Law Blog]
* How much of your vacation time did you take in 2009? Don’t lie because you want to look hardcore. [Corporette]
The public career of Rudolph Giuliani is likely at an end. The New York Times reports that Giuliani will not be running for the U.S. Senate:
Former Mayor Rudolph W. Giuliani has decided not to run for the Senate seat held by Kirsten E. Gillibrand, Republicans briefed on his decision said Monday evening. …
Mr. Giuliani, whose decision to forgo a race for governor was reported a month ago, plans to endorse Rick Lazio for governor of New York on Tuesday afternoon at a news conference in Manhattan, the Republicans said. Mr. Giuliani’s intentions were reported by The Daily News on its Web site Monday evening.
But don’t cry for the former mayor. Giuliani leaves public service for a lucrative life he’s made for himself.
As Quinn Emanuel folks are well aware (“CHECK YOU EMAILS”), there are many employees out there who are expected to be chained to their work at all times. The BlackBerry goes to bed with you, and not just because of its vibrate function. Sometimes the bedroom talk makes its way onto the BlackBerry.
Such was the case for Jeff Quon, a SWAT officer in California. He was fired after his lieutenant read hundreds of steamy text messages sent from Quon’s work pager. Quon sued the police department, arguing that the search of his texts was a violation of his Fourth Amendment rights.
Funny, we didn’t know SWAT officers even knew that there was a Fourth Amendment.
Now SCOTUS will be weighing in on privacy rights for personal communications on work-issued devices. Emily Bazelon sketches out the case’s path to One First Street over at Slate:
In June 2008, the U.S. Court of Appeals for the Ninth Circuit agreed with [Quon]. He had a reasonable expectation of privacy, the court said, given what his supervisor told him about paying for extra messages — the department’s “operational reality.” The court also found that there were other, less intrusive ways for the police chief to figure out whether Quon was frittering away his time: Warning him ahead of time to quit sending so many messages, asking him to count the characters himself, or asking him to cross out the personal parts before the department reviewed them.
This ruling, by Judge Kim McLane Wardlaw for a panel of three judges, implicitly recognizes that company pagers and e-mail accounts often turn into personal ones.
Should Quon be protected against the eyes of the boss, and in this case the law, reading the responses to “What R U wearing?”
Much of the recent talk about Hogan & Hartson has focused on their merger with Lovells. While transatlantic mergers thrill the imagination, back on the ground in the States, people are still concerned about their paychecks.
Hogan has long had a two-track salary system. The higher track paid market salary with the expectation that associates bill 1950 hours. The lower track paid less and had an 1800-hour billable expectation. Associates traditionally got to choose which track they wanted.
But Hogan turned its system on its head last spring. In April, Hogan placed associates in the lower salary track if they weren’t on target with their hours through the first quarter. The firm promised to pay the money back at the end of the year if associates did hit 1950 hours.
Well, here we are at the end of the year, and Hogan & Hartson is making restitution. And it’s paying a bonus. And it’s unfreezing salaries (although it’s not giving its people a “true-up” to where they would have been without last year’s salary freeze).
The Hogan salary structure for its two tracks, plus discussion, after the jump.
Last year, associate bonuses at Wachtell Lipton dipped below 100 percent of base salary, for the first time since 2005. This year, they continued their downward slide.
But given the problems plaguing both the broader economy and the legal profession, bonuses didn’t go down by as much as many WLRK associates expected. The general reaction at 51 West 52nd Street was one of pleasant surprise: “Less than last year, but better than expected,” according to one source. The bonuses were announced last week, around the time of the Wachtell holiday party.
So how much are your friends and classmates at Wachtell taking home this year? Find out, after the jump.
As firms start to unfreeze salaries, all in different ways, we at Above the Law have started to notice a lot of confusion about what these unfrozen salary structures look like. We’ve been seeing a lot of comments and emails like this one:
wtf is a true up vs. a thaw…dude…not everyone reads this blog 24/7…these are critical details that you are leaving up to assumption that the reader knows wtf nerd language you are talking about…
To help clarify things, we have put together a little chart. To make things easier, we have looked at the salary of a fictitious soon-to-be third year from the incoming class of 2007. It seems appropriate to look at this class of people; since they are about to enter their third full year of work, they’ve experienced the recession in all of its glorious forms. And looking at one class’ salary over the years is less confusing than looking at everybody’s salary at every level.
To refresh your memory, here’s what our class of 2007 associate has been paid at a top tier firm that didn’t freeze, year-by-year. A person working at Davis Polk, for instance: FIRM THAT NEVER FROZE
’07 (stub-first year) = $160K
’08 (full first year) = $160K
’09 (second year) = $170K
’10 (third year) = $185K
But not everybody can work at Davis Polk (or someplace similar). How the other half lives after the jump.
We received over 1,000 responses to last week’s Career Center survey on whether your vacation plans have been affected by the economic downturn. The results reveal that almost 70% of associates are still taking vacation time, regardless of whether they have met their billable hours or not. Less than 10% of respondents say that they are not taking vacation because they worry it might look bad. However, almost a quarter of respondents report that they are actually too busy to use their full vacation time this year.
Check out the full survey results after the jump — and visit the Career Center, powered by Lateral Link — for more on which firm has deferred start dates again, which firm recently announced a mega-merger with a London-based firm, and which firm reportedly awarded 2009 bonuses of up to $90,000.
Full survey results, after the jump.
The two-thirds of the Above The Law team in New York report that it’s starting to look and feel a lot like Christmas in the Northeast. Some of those reports are overly graphic. The one-third of the team spending the holiday in Florida attests to warmth and sunshine.
This post is dedicated to the loved ones in your life, who want last minute shopping advice. For many lawyerly types, a new job would be the best gift of all, but that’s hard to wrap. Though not impossible.
We’ve got five easier gifts to give, after the jump.
Ed. note: The Asia Chronicles column is authored by Kinney Recruiting. Kinney has made more placements of U.S. associates, counsels and partners in Asia than any other recruiting firm in each of the past six years. You can reach them by email: [email protected].
Since late last year, things have been booming in Hong Kong / China in cap markets, especially Hong Kong IPOs. M&A deal flow has recently been getting a bit stronger as well. Although one can’t predict such things with any certainty, all signs are pointing to a banner entire 2014 for the top end US corporate and cap markets practices in Hong Kong / China. This is not really new news, as its been the feeling most in the market have had for a few months now and things continue to look good.
The head of our Asia practice, Evan Jowers, has been in Hong Kong for about 10 days a month (with trips every other month to both Shanghai and Bejing) for the past 7 months, and spending most of his time there meeting with senior US hiring partners at just about all the major US and UK firms there, as well as prospective candidates at all associate levels and partner levels, and when in the US, Evan works Asia hours and is regularly on the phone with such persons, as our the other members of our Asia team. Our Yuliya Vinokurova is in Hong Kong every other month and Robert is there about 5 times a year as well. While we have a solid Asia team of recruiters, Evan Jowers will spend at least some time with all of our candidates for Asia position. We have had long standing relationships, and good friendships in some cases, with hiring partners and other senior US partners in Asia for 8 years now.
The evolution of relationships between the genders continues. Currently, in law firms, there is an interesting conundrum; balancing the desire for a gender-blind workplace where “the best lawyer gets the work and advances” and the reality of navigating the complicated maze created by the fact that, in general, men and women do possess differences in their work styles. These variations impact who they work with, how they work, how they build professional connections and how organizations ultimately leverage, reward and recognize the talents of all.
Henry Ford sat on his workbench and sighed. A year earlier, he had personally built 13,000 Model Ts with his own hands. Fashioning lugnuts and tie rods by hand, Ford was loath to ask for help. Sure, there were things about the car that he didn’t quite understand. This explains the lack of reliable navigation systems in the Model T. But Ford persevered because he knew that unless he did everything, he could not reliably call these cars his own.
“Unless my own personal toil is responsible for it, it may as well be called a Hyundai,” Ford remarked at the time.
The preceding may sound unfamiliar because it is categorically untrue. And also monumentally stupid. Henry Ford didn’t build all those cars by hand. He had help and plenty of it. Almost exactly one hundred years ago, Henry Ford opened up the most technologically advanced assembly line the world had ever seen. Built on the premise that work can be chopped up into digestible pieces and completed by many men better than one, the line ushered in an age of unparalleled productivity.
Today, an attorney refers business because he can’t do everything the client asks of him.
There are three reasons why this is way dumber than a made-up Henry Ford story…