The New York Times has a nice survey piece about all the salary cuts imposed upon American workers. It’s a story that anybody holding down a job through this recession is probably aware of:
Local and state governments, as well as some companies, are squeezing their employees to work the same amount for less money in cost-saving measures that are often described as a last-ditch effort to avoid layoffs.
Yeah, we know, things are crappy.
But in its zeal to show that things are difficult for almost all workers, the Times seems to lump Biglaw in with the group of companies that are trying to cut costs by slashing salaries. As regular readers of Above the Law know, that might have been true in 2009. But in 2010, most Biglaw firms are not cutting associate salaries….
Well, it’s about time. On April 13th, a small claims court in Florida will deal with a case where an associate is suing his former law firm over allegedly deferred compensation. Only $2,000 is at issue, but this is a battle of principle. The Daily Business Review (subscription) sets it up:
The salary deferral imposed by [Becker & Poliakoff] in May 2008 was temporary and necessary in order to avoid layoffs during the economic downturn, managing partner Alan Becker said….
Former Becker associate Richard Valuntas sued the firm last August, alleging Becker committed breach of contract and fraudulent misrepresentation by refusing to repay him the 12 percent deducted from his paycheck for several months. He also alleges Becker’s deferrals violated its own employment contract and policy manual.
You see, the firm promised restitution of the salary cut, and they did eliminate the cut in August of 2008 and gave associates make-whole payments. But only associates still at the firm received full restitution. Valuntas left Becker that August and apparently missed out on one of these restitution paychecks.
Despite the small amount of money involved, both litigants are going to the mattresses…
Friday brought good news and bad news for Winston & Strawn associates.
The good news is that the double salary freeze, which has apparently resulted in first- through third-year associates at Winston all earning $160,000, may be thawing. Managing partner Thomas Fitzgerald sent a memo — this time to its intended recipients — indicating that raises are on the way.
The bad news is that Winston associates don’t know how much of a raise they’ll be getting — and the most they can hope for is a salary that matches the market. The memorandum contains the standard $160K salary scale — 160-170-185-210-230-250-265-280 — but states that “[s]alary levels in each associate class will range up to the maximum base compensation levels set forth” in the memo (emphases added).
The Winston associates we’ve heard from are upset. They’re unhappy not just about the move away from lockstep, but over the firm’s failure to set forth in detail how salaries will be determined. Most of the other firms that have abandoned lockstep have set forth elaborate systems for evaluating associates to determine their compensation and advancement. The Winston memo simply states: “Individual associate salaries will be determined on a case by case basis based on seniority, performance and productivity factors and will be communicated separately to each associate.”
This is a “black box” approach to compensation. It’s used by other big firms — e.g., Jones Day — but it’s a significant departure from Winston’s historical practice. It’s not what Winston associates signed up for when they joined the firm.
But then again, thanks to the Great Recession, lots of Biglaw associates aren’t getting what they expected when they joined their firms. And if associates aren’t happy, with compensation or any other aspect of their employment, their firms will tell them: you’re free to leave. In the words of an unemployed woman quoted in this weekend’s New York Times, “There are no bad jobs now. Any job is a good job.”
There’s a little more bad news about Winston associate salaries. Find out what it is, and read the full Winston & Strawn memo, after the jump.
Add Dickstein Shapiro to the list of firms that have decided to do away with lockstep associate compensation. As of January 22, Dickstein will adopt a new merit-based compensation system. Like many firms that have abandoned lockstep, Dickstein will be using a three-tiered system, similar to Orrick’s compensation structure.
Starting salary for new Dickstein associates will be $145,000. Or maybe it will be $160,000. Honestly, I can’t tell you with certainty what new associates will be making.
It’s not my fault. I read the original memo and everything. I talked to friends and sources and a spokesperson for the firm. I prayed on it. I just can’t seem to pin down one solid number for first-year associate salaries.
After the jump, why don’t you guys take a look at the memo? Maybe you’ll have more success divining its meaning than I did.
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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: asia@kinneyrecruiting.com.
Deal flow has clearly picked recently up for most US associates, counsels and partners in Hong Kong/China and Singapore. We are on the phone with a lot of these folks on a daily basis, many of whom we have known for years. Further, the head of our Asia team, Evan Jowers, and Kinney’s founder and president, Robert Kinney, frequently meet in person with leading US partners in Asia to assess their needs and keep on top of the inside scoop at as many firms as possible. The need for legal recruiting help in Asia from experienced recruiters appears to be live and well. In March, Evan and Robert were in Beijing at such meetings, in April, Evan was in Hong Kong, and for half of June Evan will be in Shanghai and Hong Kong. Thus its pretty easy for us to tell when there has been an across-the-market pick up in capital markets and corporate work.
On an average day in Asia when Evan and Robert visit firms, they typically have 5 to 9 meetings a day, mostly with US partners in the market. The reason they have these meetings is not simply because Kinney makes a lot of US attorney placements in Asia and that a particular firm may have openings; instead these are just visits with friends. After years of working together as business partners, the folks at Kinney are actually these peoples’ friends. The firms Kinney work closely with in Asia (which is just about every law firm – call us if you want to know the one firm in the world we will never place anyone with again, ever, and why) look forward to the visits, or at least act like they do. After seven years in the market, many of the client partners are former associate candidates. Also, these US partners see Kinney as a very good source of market information as well, because they know how deep their contacts are in the market and how frequently they are speaking to counterparts at peer firms.
In a land that is right here and in a time that is right now, a technology has arisen so powerful that it can replace basic human document review. Is it time to bow down before our new robot overlords?
First, here’s a little story about me: my life in the legal world began as a paralegal. My first case was a GIANT patent infringement case that was already six years old and had involved as many as five companies, multiple US courts, the ITC and an international standards committee. I knew nothing about any of this.
On my first day, my supervisor (a paralegal with at least eight other cases driving her crazy) sat me down in front of a Concordance database with a 100,000+ patents and patent file histories. “Code these,” she said. I learned that “coding”, for the purposes of this exercise, meant manually typing the inventor’s name, the title of the patent, the assignee, the file date, and other objective data for each document. I worked on that project – and only that project – for at least the first six months of my job. After a week or so, time began to blur.
What I know, in retrospect and with absolutely certainty, is that as time began to blur, so did my judgment. So did my attention to detail. If you could tell me that I did not make at least one mistake a day – one inconsistent spelling, one reversed day and month, one incorrectly spaced title – I frankly would need to see your evidence. I would not believe it. The human mind is trainable but it is not a machine.
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The New York Times has a nice survey piece about all the salary cuts imposed upon American workers. It’s a story that anybody holding down a job through this recession is probably aware of:
