It looks like Pillsbury is back to communicating important information via firm-wide memo, instead of via cell phone conversation on the Acela. Yesterday, the firm indicated that it is thinking about moving away from lockstep associate compensation, but it is not killing lockstep just yet.

Instead, Pillsbury announced lockstep raises — they’ll be true up raises if you hit your hours in New York. In other offices, Pillsbury has decided to lowball the market. From the firm-wide memo:

So, it’s a true-up raise for some, a single class thaw out for those low on hours, and a salary cut for many outside of New York.

But at least it’s clear.

Pillsbury’s New York bias when it comes to salaries extends to the firm’s decisions regarding bonuses. Details after the jump.

It looks like the game of salary chicken between Mayer Brown and Sidley Austin is just about over. On Monday we noted that Mayer Brown was taking its time to let associates know whether or not their salaries will be re-frozen. Today, Mayer Brown’s D.C. office announced that salaries will be raised back to market levels — a true-up raise for associates at the firm. (We also hear that true-up raises on coming out for New York, but we haven’t seen that memo.)

Bonuses are still to be determined, so we don’t know if Mayer will include a make-whole provision to get people back the money they lost while their salaries were frozen in place.

Still, it’s great news.

And now our eyes turn towards Sidley Austin. In January, Sidley indicated that it was waiting to see what it competitors did before it committed to a 2010 salary structure. So let’s review.

Kirkland & Ellis: Never froze.
Latham & Watkins: True-up raise. Make-whole bonus.
Mayer Brown: True-up raise in D.C. (and NYC we think).

Are there other firms that Sidley is waiting for? Jenner? Winston? Bendini Lambert & Locke? Come on, the salary market for top tier firms has been re-set at pre-2009 levels. Some would argue that the salary market for true top tier firms never changed in the first place. Sidley needs to get off it’s horse.

Congratulations to Mayer Brown. Now, about that bonus …

Check out the Mayer Brown salary memo after the jump.

A quick glance at the calendar reveals that today is February 1st. 2010 is fully under way. Is there a reason why Mayer Brown associates still don’t know how much money they’ll be making in the current year? Mayer Brown had a two hour all associates meeting on Friday. Amazingly, management was able to babble for 120 minutes without saying a word about 2010 salaries:

We just had the quarterly meeting and no announcement of compensation news, lots of discussion of uptick in lateral hiring. WTF!?! Are Sidley and Mayer price fixing or what?

The Sidley quip refers to the fact that Sidley Austin is also waiting around — for no discernible reason — to make a hard decision about associate salaries.

Is this evidence of collusion among big Chicago firms? I’m going the other way on this.

Last week, Wilson Sonsini was busy shuffling staffers out the door. Today, Wilson Sonsini is proud to announce bonuses for the lawyers — just in case any of them were feeling bad about their recently departed secretaries.

The firm-wide memo just went out; here’s the bonus news:

Merit Bonus The firm will pay merit bonuses for FY10 to all eligible non-member attorneys. Continuing with the criteria implemented last year, the merit bonus program provides for hours-based awards to all attorneys in good standing who achieved 1,900 or 2,100 bonus-eligible hours over the course of the 2009 calendar year. In addition to the hours-based component, attorneys also may receive a discretionary amount based on work quality and overall contribution to the firm. …

This year’s total bonuses range from a maximum of $9,000 for eligible associates from the class of 2008 to a maximum of $49,000 for eligible associates from the 2002 and earlier classes.

While the top number is more than the Cravath scale, we have no idea how many lawyers actually exceeded the Cravath bonus. I’ll spare you the familiar rant about the uselessness of providing the high score without mentioning the average payout associates received. Suffice it to say: nobody’s fooled.

UPDATE: We now have the full bonus memo for WSGR, which appears after the jump.

Wilson Sonsini also announced salary news today. After the jump, you’ll see that it looks suspiciously like a thaw of one class year.

There’s good news at Cooley Godward Kronish. The firm was among the many that froze salaries last year. This month, Cooley announced it’s more of a hottie.

The good news is that the firm is taking salaries out of the freezer. The bad news is that the salaries have suffered some freezer burn.

The firm’s new base salary scale reflects some chipping away.

There’s a lot of news coming out of Goodwin Procter today. Some of it is even pretty good. In a wide-ranging, firm-wide memo, Goodwin announced bonuses (basically), thawed out salaries (kind of), and indicated an intention to adopt a merit-based compensation structure (sort of).

Let’s start with the bonus news:

Maybe you got a little bit more, maybe you got a little bit less. But if you hit 1,850 hours at Goodwin Procter in 2009, you were in the general vicinity of a Cravath-level bonus.

For salaries it’s a little more complicated.

Way back in November 2008, Bryan Cave became one of the first firms to freeze associate salaries. At the time, the firm said that it was only delaying its planned salary increase by three months. But firms said a lot of things back in 2008 that proved unworkable in 2009.

A tipster reports that the freeze is on again at Bryan Cave for 2010. The firm hasn’t made a formal announcement about it or issued an internal memo, nor has it responded to our multiple requests for comment. But a few people have been informed internally that the freeze is on again for 2010 — and we have not heard from anyone who has had a pay raise so far in the new year. If you have additional information on how widely this “no pay raise” message has been disseminated, let us know at tips@abovethelaw.com.

UPDATE: Although there was no memo, there were meetings at which a continued salary freeze was announced.

But that’s not all. If you look at the full scope of Bryan Cave’s actions, the firm appears to be in some very special company.

We’ve been reporting on firms that have announced pay freezes for 2010, but at some firms, the salary outlook for 2010 is still unclear.

For example, associates at Mayer Brown and Willkie Farr are huddled in the dark, not sure if they’re freezing. From a junior Willkie associate:

I’m a second-year associate at Willkie. I just learned that traditionally, associates are told about their imminent salary bumps at their year-end evaluations. I’ve discussed it with some friends, and nobody has heard anything about salary freezes or bumps at WFG.

And from an MB associate:

Mayer Brown’s still frozen. Granted they’ve put off addressing salary raises until February in the past, but we got our first 2010 paychecks today with no raises, and not a peep from the partnership to let us know they’ve even considered the issue. As of now I’m two years behind where I’d be at Dechert. This sucks.

We can’t confirm whether salaries at these firms are frozen for the year, but we can encourage a conversation about firms that are raising salaries. We hear from a Paul Weiss associate, for example, that an email went out letting them know salaries there are warm. Our tipsters says that PW checks this month will have the “usual bump” up.

Here’s an open thread for discussion of raises as usual. Who’s warm and toasty this January?

First year associates at Pillsbury Winthrop Shaw Pittman got a poke last night that didn’t make them “hee-hee.” The announcement was not made on the Acela. It came via a firm-wide email from executive partners Jeffrey Grill and Sheryl Stein.

All first years, except those in New York, are having their salaries cut. From the memo:

Based on our current assessment of the market for associate salaries and with our incoming first year associates joining the Firm shortly, the Firm has decided that, effective January 1, 2010, first year associates resident in our U.S. offices (other than New York) will be paid at an annual base salary rate of $145,000. First year associates resident in our New York office will be paid at an annual base salary rate of $160,000.

This isn’t the first salary cut at Pillsbury. Back in June 2009, the firm cut salaries based on utilization rates.

There is a caveat to this latest announcement. The firm recognizes that the market outside of New York is still “in flux” and it might raise salaries accordingly (and retroactively) if it sees fit in the future. Alternately, if first year associates outside of New York bake up 1950 hours, they’ll pull a $15k bonus out of the oven at the end of the year. See the full memo, after the jump.

What about the 2010 pay scale for the rest of Pillsbury’s associates?

Before the holidays, we reported that Latham & Watkins planned on making a true-up salary raise, putting its associates back on the level they would have been on had Latham never frozen salaries in the first place.

Today, Latham made it official. Multiple tipsters tell us the firm just announced its 2010 salary structure:

It was announced in a short e-mail from the executive committee that included a link to a secure PDF with the info.

The old new payscale, after the jump.

We all know that Venable is a “wacky” place to work. But is the firm also cheap? Last week, the firm announced its 2010 salary structure. It’s almost like Venable looked at all the different ways firms are handling salaries and decided to try all of them, at the same time. The firm-wide memo from managing partner Karl Racine truly has it all:

As you know, 2009 has been a difficult year for the practice of law. The impact of the recession on our clients has been severe. As a result of this unprecedented downturn in business activity, law firms were forced to take significant action to fundamentally realign their business models with the reality of a market place characterized by a significant decline in the demand for legal services. In a real way, the law firm business model has experienced a demonstrable market correction. While Venable has not been immune from these economic forces, the firm has exhibited remarkable and enviable resilience.

As we prepare to close the books for 2009, the firm will likely end the year less than one percent below 2008 revenues. There is no doubt that the firm’s solid performance is attributable to the superior work and effort of all of its staff, lawyers, legislative advisors, legal professionals, and management team. Perhaps like no other year in the firm’s history, Venable charted its own course in the face of disparate actions taken by our competitors.

I suppose, technically speaking, doing a random mash-up of all the things your competitors have done constitutes “chart[ing] [your] own course.”

Let’s break it down after the jump.

Ed. note: An earlier version of this post incorrectly stated that the firm has not yet communicated to its associates about salaries. This was correct as of late December, but shortly before the new year, the firm made its announcement. We have amended the post accordingly, and we apologize for the error.

It’s a brand new year. Yay. Will this be the year that the recession ends? We’re hopeful, as are you (based on the results of our reader poll thus far).

Here’s some good news to start off the day. A source at Arnold & Porter reports on the firm’s unfreezing of salaries (as well as lump-sum payments representing deferred comp):

Arnold & Porter just announced we are bumping one class year, plus those in good standing are getting their deferred 2009 compensation. Classes of 2008 and 2009 are both at $160,000 for 2010.

This salary thaw is certainly welcome news — but note that it doesn’t take A&P up to the full New York scale. In 2010, under the NYC scale, class of 2008 associates should be earning $170,000 (not $160,000), class of 2007 associates should be earning $185,000 (not $170,000), etc.

The full memorandum, which was issued on December 30, also confirms upcoming bonus payments:

Consistent with the Firm’s longstanding commitment to be competitive in the marketplace, the Firm will be paying bonuses to eligible associates in respect of their 2009 performance. The bonuses will be based not only on the number of billable, pro bono and business development hours but also with attention to the results of the associate review process, particularly the quality of work and whether an individual has performed at a level commensurate with his or her seniority. Compliance with Firm policies also will be taken into consideration.

What can be expected regarding bonuses at Arnold & Porter? A second tipster explains:

A&P pays no “base” bonus. Bonuses have traditionally been based on hours. Last year, I ended up with more than I would have on the standard New York scale. But some ended up with much less, or none.

Check out the full memo, after the jump.

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.

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…

Good point.

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 previously expressed skepticism towards the notion of a salary thaw. As Elie wrote, “Ha. Haha. Unfreezing? Yeah. Let me just ride my unicorn down the streets of El Dorado and see what there is to see.”

But perhaps the joke is on us. It seems that some firms are unfreezing salaries. On this subject, of course, we are happy to be wrong. Green shoots, an end to the recession — yay!

On Friday, we reported on Allen & Overy’s decision to unfreeze associate salaries. Today we bring you news of a similar decision by Akin Gump.

Memo after the jump.

Cheerio, old chap! This week brings news of bonuses — and a salary “unfreeze” — in the New York office of Allen & Overy.

Allen & Overy — a global mega-firm with over $2 billion in annual revenue, headquartered in London but with a worldwide footprint — is making a go of it here in the United States. And, as reflected in this latest news, A&O intends to play with the big boys in New York. They’re paying market-level bonuses this year.

And, effective January 2010, they’re paying market-level salaries. The increase in salaries undoes the salary freeze from earlier this year. Green shoots?

But there is a catch. Read the full memo, from New York managing partner Kevin O’Shea, after the jump.

The artifice of the slurpee salary freeze and the “temporary” salary cut can be put to rest. As long as you are not doing keggers with the firm Kool-Aid, you already know that Biglaw will keep associate salaries depressed for as long as they can. It’s not hard to see where this is going, as Am Law Daily reports:

“If you do the math,” says Steven Davis, chairman of Dewey & LeBoeuf, “associate compensation is coming down across the board.” …

“I lean much more in the direction that this is not a blip,” says Dewey’s Davis. “In the medium term, we’re seeing, and will continue to see, a paradigm shift” in associate compensation. (Dewey, interestingly, hasn’t announced cuts in compensation or in bonuses, though it has sent dozens of 2009 first-years on leave with a stipend.)

That last parenthetical isn’t entirely forthright. Dewey hasn’t announced bonuses yet. If the firm follows Cravath or S&C, that will represent a “cut” in bonuses from last year (to say nothing of two years ago). If Dewey doesn’t follow the market and instead pays what it did last year, I’ll strip naked and run through the streets screaming “I am TTT! I am so TTT!”

But the general point — the one about basic “math” — is exceedingly obvious.

The only open question is whether firms will keep the deflationary salaries on lockstep, or if they’ll move towards a system that rewards people based on still undefined “performance metrics” instead of experience and billable hours.

If you thought you left the curve behind when you graduated law school, think again. DLA Piper has decided to throw its hat into the killing lockstep arena. In a long memo released to associates this morning, DLA outlines its intention to withhold a greater percentage of associate compensation until the end of the year. Associates will have an opportunity to get this money back, if they perform well on their performance reviews.

But the performance reviews will be curved, bringing a sense of the grading competition and bitterness from law school and adding it to firm life.

Let’s jump into the details, after the jump.

On Wednesday, we reported that Patton Boggs was keeping its salary freeze in place. In November, we told you that Covington & Burling was instituting a salary freeze, even though the firm didn’t do it last year.

But the news coming out of D.C. isn’t putting a damper on the holiday hopefulness of some New York-based associates. Above the Law received this question earlier this week:

I’m a senior associate at a large NYC law firm — I’m hearing rumors that some large law firms who have frozen salaries (which unfortunately includes my firm) are preparing for the big thaw — have you guys heard anything to that effect?

Ha. Haha. Unfreezing? Yeah. Let me just ride my unicorn down the streets of El Dorado and see what there is to see.

Yesterday we reported that Patton Boggs was having an all associates meeting and wanted its people to be there in person.

With everybody gathered around, Patton Boggs unleashed a torrent of news. First things first. Here’s the bonus announcement, from a statement the firm released to Above the Law about the meeting:

As usual, we are rewarding associates who exceed their billable hour goal with our annual bonus program. Bonuses will range from $5,000-$45,000 depending on class year and the number of hours by which an individual target was exceeded.

In addition, the firm plans to offer merit bonuses in January as part of the associate evaluation process.

Well, the New York market starts at $7,500, so the low end of the Patton Boggs scale is below the bottom of the NYC scale. But at the top end, Patton Boggs is paying more than the Cravath scale.

It is worth noting, of course, that Cravath and other top New York firms pay bonuses to everybody, not just those who “exceed their billable hour goal.” In this market, is anybody actually billing anything like 2400 hours? It could be that Patton Boggs’s big top number is a payout only a couple of people will actually receive.

And the bonus news was the good news to come out of the meeting. The other news is after the jump.