Not many firms try to trump Cravath, the traditional market leader when it comes to year-end bonuses. Most major firms are followers.
There are a few exceptions, and one of the exceptions is Skadden Arps. Back in 2008, Skadden announced bonuses before Cravath, and those Skadden bonuses turned out to be much higher than Cravath’s. When most other firms subsequently followed Cravath instead of Skadden, my colleague Elie Mystal mocked these firms for their “Half-Skadden” bonuses.
Skadden just announced its 2013 year-end bonuses. Did it beat the Cravath bonuses, or did it join them?
The Empire State Building, lit up with the colors of the Philippine flag to show support for Typhoon Haiyan victims. (Photo courtesy of Natalie Navarrete.)
When disaster strikes, lawyers are there (and not just to hand out their business cards). Lawyers and their law firms have responded swiftly and generously in the wake of natural disasters, giving of their time and treasure to help the victims of calamities around the world.
Lawyers and their law firms, especially Biglaw firms, have come to the aid of people affected by Hurricane Sandy, the Japanese earthquake and tsunami, and earthquakes in Haiti and China. We have chronicled and commended these efforts in Above the Law over the years.
In light of this track record, it should come as no surprise that one of the world’s top law firms is giving generously to support relief efforts in the Philippines, my ancestral homeland, where thousands have died due to Typhoon Haiyan (local name Yolanda). Which firm, and how much is it giving?
Stick a fork in it, because it’s almost done. There’s a high likelihood that the 2012 associate bonus season is complete, at least for all practical purposes, and if so, it will look a lot like past bonus seasons: Cravath leads, and everyone else follows.
“High likelihood,” but not yet a certainty. There’s one major wild card that’s still out: Sullivan & Cromwell, which sometimes takes the lead on associate compensation. Remember, of course, that the 2011 spring bonuses were brought to you by S&C. One could certainly see a scenario in which Sullivan & Cromwell trumps Cravath, in order to get Cravath back for how CSM showed up S&C on spring bonuses.
Unless and until Sullivan & Cromwell beats Cravath, though, we’re playing the usual game of follow Cravath. Let’s check out the latest firm to fall in line….
No surprises here: Skadden has matched the 2011 Cravath bonus scale. Given the sheer size of Skadden, in terms of attorney headcount, this announcement directly affects the pocketbooks of more lawyers than the Cravath news (although the indirect effects of Cravath as market leader are, of course, huge).
So we won’t have a repeat of 2008, when Skadden paid twice as much as Cravath (aka Half-Skadden). Firms are essentially recycling last year’s bonus schedules. Hence our snazzy “recycling money” image, which will be the logo for Associate Bonus Watch 2011.
Let’s look at the memo, along with reactions from SASMF associates….
This shouldn’t come as a shock: Skadden is paying spring bonuses. And it’s doing so on the top-of-the-market Cravath scale. Yay!
According to a memorandum sent to the Skadden Arps partnership by email this morning — before 8 a.m., so prior to the Davis Polk announcement — the firm was originally planning to match market for the most junior ($2,500) and most senior ($20,000) associate classes. As for mid-level associates, it was going to split the difference between the Cravath scale and the Sullivan & Cromwell scale: “We are planning a mid-level associate bonus range which is somewhat higher than the general pack, but not the highest levels currently announced.”
But then came the Davis Polk announcement, at around 10:30 a.m., in which DPW went with the Cravath scale. And now Skadden has too.
Did the Davis decision change the thinking at Four Times Square? Let’s look at the memos….
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When Chintan Panchal decided to leave a global BigLaw partnership to start his own firm, he could only hope that he would face the high-quality problem of firm building that many had cautioned him about. Focused on the uncertainty surrounding of a new firm launch, he decided to tackle staffing needs, IT challenges, and financial planning requirements after he had built up his legal practice.
Panchal Associates LLP–a corporate/finance and outside general counsel boutique–was quickly off to a great start. Clients and matters were flying in the door, and Chintan soon had a team of lawyers and staff with a variety of operational needs. To continue building an excellent team and provide them with a competitive benefits package, to expand his physical presence to include a European practice and additional partners, and to scale his operations and IT capabilities to support this growing enterprise brought with it demands of time, money, and expertise. Chintan knew he needed help.
“With the assistance of NexFirm, we have upgraded the capabilities of our firm to meet, and in some cases exceed, the standards we were used to at our former BigLaw firms. Operationally, we can now attract and service clients we didn’t have the bandwidth to support in the past, and continue to build our team with the best and brightest legal talent in the industry,” said Chintan Panchal, adding “It has worked out quite well in our case; NexFirm is an essential partner for us.”
The holiday season is upon us, and yet again, you have no idea what to get for the fickle lawyer in your life. We’re here to help. Even if your bonus check hasn’t arrived yet, any one of the gifts we’ve highlighted here could be a worthy substitute until your employer decides to make it rain.
We’ve got an eclectic selection for you to choose from, so settle in by that stack of documents yet to be reviewed and dig in…
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