Are you still trying to catch your breath from the bonus announcements at Skadden and Half-Skadden (f/k/a Cravath)? Or are you waiting patiently for S&C to “settle” this bonus debate among top firms? Either way, most people are still just trying to understand why Cravath low-balled the market yesterday.
A couple of days ago we mentioned a theory that has become very popular over the last 18 hours: firms are going to give low bonuses to look responsible to their clients. On Tuesday, we explained the theory like this:
So, reason one: If they give you a bonus, you might tell someone, um, like Above The Law. And reason two: pressure from clients to control costs. Anonymous firm leaders say they fear the effect a big bonus announcement would have on their fee negotiations with belt-tightening clients, especially those in the financial sector.
Some people really believe this is happening, and are using Cravath’s bonus announcement as Exhibit A. One tipster even asked ATL to “stop reporting bonus information.”
But while we can’t know what kind of paranoia is gripping law firm leaders at the moment, we’re pretty sure that clients don’t actually care about associate bonuses.
So ATL also asks in the post, what about clients? Should great clients care about associate bonuses this year–this evil and financially difficult one of 2008–more than any other year?
The answer: absolutely not.
More analysis after the jump.