Kirkland & Ellis New Vacation Policy: Tastes Great, But Is It Less Filling?

The associates who work at Kirkland & Ellis remain sublimely confident that their firm will pay elite bonuses as opposed to the discount payouts being offered elsewhere.

But in these uncertain economic times, any change in firm policy — even one that seems positive — has to be met with skepticism.

Yesterday, our inbox started buzzing as various Kirkland tipsters let us know that the firm has undertaken a massive change in associate vacation policy. At first blush, the revised policy seems … awesome:

Instead of providing attorneys with a fixed number of vacation days each year, our revised policy will permit attorneys to take time off with pay – for rest and relaxation, or to attend to personal matters – at their discretion, subject only to the Firm’s overall performance expectations. Those performance expectations include, most importantly, that our lawyers will provide the highest quality legal work and service to our clients, contribute to the Firm’s pro bono programs and participate in non-billable efforts on behalf of the Firm. The revised policy aligns our associate paid time-off protocol with our long-standing practice for partners. We also feel it is consonant with both our Firm’s entrepreneurial culture and our associates’ desire to manage their own careers and maintain a suitable work/life balance.

Some associates would undoubtedly prefer to have a fixed amount of vacation time to which they are “entitled.” But most people enjoy being treated like adults with the maturity to manage their responsibilities. People know how to manage their own time better than law firm managers (wow, I just made a federalist argument).

After the jump, Kirkland associates weigh in on the full memo.


Every move taken by management has to be looked at with a critical eye. Remember, just a few weeks ago Kirkland downsized breakfast in a cost cutting maneuver. One tipster explains the possible downside:

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The essence of this new policy is that the firm will save money because they will no longer have to pay associates as much as 5 weeks of accrued vacation time (5 weeks is the max you can accrue) when they leave the firm. Nobody thinks it’s a way for the firm to prevent people from taking their vacations. Rather, it’s just more not-so-subtle penny-pinching like with the breakfast cutbacks.

The new policy specifies that all vacation accrued in 2008 will still be honored. But after the new year associates will no longer accrue vacation time. That could save the firm some money.

Of course, every associate would be perfectly happy if Kirkland saved some extra cash, so long as they receive the bonuses they’ve earned from a hardworking and productive year. Another tipster puts plainly what Kirkland associates are worried about:

People are really concerned about whether K&E will hold true to its roots of being a “meritocracy” when it comes time to calculate bonuses. The firm’s bankruptcy, intellectual property and litigation practices are doing great, and we’ve heard nothing suggesting that the firm is struggling. There is no reason why associates who are producing tons of money for the firm just as they have done in previous years (i.e., high billers and/or above the class) should get screwed because Cravath and Davis Polk had a bad year. K&E isn’t a lockstep firm, and people come to K&E so they can get appropriately compensated for being valuable to the firm.

The message from Kirkland people is clear: cut costs, change policies, do whatever you need to do, just don’t mess around with the bonus.

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Is management listening?

Read the full memo below.

KIRKLAND & ELLIS — MEMO — NEW VACATION POLICY

The quality of service we provide to our clients depends greatly on the health and well-being of our attorneys. For this reason, we believe all of our lawyers should periodically take time off from work for rest and renewal. Consistent with that belief, the Firm introduces a revised Associate Time-Off policy, which will become effective January 1, 2009.

Instead of providing attorneys with a fixed number of vacation days each year, our revised policy will permit attorneys to take time off with pay – for rest and relaxation, or to attend to personal matters – at their discretion, subject only to the Firm’s overall performance expectations. Those performance expectations include, most importantly, that our lawyers will provide the highest quality legal work and service to our clients, contribute to the Firm’s pro bono programs and

participate in non-billable efforts on behalf of the Firm. The revised policy aligns our associate paid time-off protocol with our long-standing practice for partners. We also feel it is consonant with both our Firm’s entrepreneurial culture and our associates’ desire to manage their own careers and maintain a suitable work/life balance.

The Firm expects that its attorneys will continue to exercise sound judgment in determining when to take time off, including giving appropriate consideration to client and Firm deadlines and other objectives. The policy will not permit an associate to take general paid time-off for more than four weeks consecutively. Beyond that stipulation we do not intend or expect this change in policy to affect the amount of time that our lawyers take off on a discretionary basis, and we will continue to encourage them to take opportunities for rest and relaxation.

The revised policy will supersede the current Associate Time-Off policy, as well as certain of the Firm’s current paid time off policies, including policies on vacation and personal time. Defined leaves of absence, such as medical leave, personal/parental leave or family medical leave, unpaid leave or leave provided to study for the bar, are governed by separate policies that will not be affected by changes to the Associate Time-Off policy.

Below are a few questions and answers that may help further clarify your understanding of the new Associate Time-Off Policy.

Will associates still need to track and schedule their time-off?

Standard procedures and courtesies for scheduling and recording time-off (i.e., advance notification of colleagues, other office personnel, and clients) will still apply. Inasmuch as our time reporting policies require attorneys to account for a minimum number of hours each business day, all time off must be recorded to 900-16 in Carpe Diem, whether for vacation, illness or other personal matters.

What will happen to the vacation days I’ve already accrued?

Associates will not accrue new vacation days after December 31, 2008. However, associates who have accrued and unused vacation days from the period prior to December 31, 2008 will be entitled to use those accrued vacation days thereafter during what otherwise would be unpaid leave. Associates who leave our employ will be paid in full for those unused days upon departure from the Firm.

How does ‘time off’ differ from ‘leave’?

Historically, time away from work taken in accordance with an authorized ‘leave’ policy (i.e., parental leave, military leave, medical leave, unpaid personal leave, etc.) has been disregarded, or ‘neutralized’, for purposes of performance reviews and calculation of the “hours” portion of any year-end bonus. Such has not been the case with vacation time or other personal time off. The Firm expects to continue this approach to performance reviews and determination of bonuses. Under this approach, if an associate takes an authorized leave but otherwise works a full year, the portion of such associate’s year-end bonus that is based on “hours” billed will be calculated by (i) first, determining the bonus to which the associate would have been entitled had he or she worked during the full review year at the pace at which he or she worked when not on authorized leave (i.e., by “annualizing” time billed, including pro bono hours and eligible ‘office’ hours), and (ii) second, pro-rating that bonus amount based on the percentage of the year the individual was not on leave.

For example, if an associate takes three months of authorized leave, is otherwise employed by the Firm for a full review year, and bills 1,500 hours (including pro bono hours and eligible “office” hours), the associate would be entitled to 75% (i.e., the portion of the year the associate was not on leave) of the hours-based bonus to which she would have been entitled had she billed 2,000 hours (i.e., 1,500 / 0.75) for the full year.

How will the revised Associate Time-Off policy impact Parental Leave?

In the past, some new parents have requested to use vacation days to extend their parental leave beyond the period provided under the Firm’s Parental Leave Policy. Under the revised Associate Time-Off Policy, new parents may still extend their paid time off, for up to four consecutive weeks, with the support of the partners with whom they work. However, as per past practice and as discussed above, time off outside of an authorized leave is not ‘neutralized’ for purposes of bonus determination. Similarly, the option to take unpaid leave time to extend parental leave will remain unchanged. Again this needs the support of the partners with whom the individual lawyer works and also requires Firmwide Administrative Committee approval. Please refer to the Leave of Absence – Associates Policy for more information.

Is the Firm trying to discourage Associates from taking time off?

No. In fact our hope is that this policy more clearly evidences the importance the Firm places on associate autonomy and balanced lives. By eliminating the distinction between ‘vacation’ and ‘personal time’, the message to associates is to use time not directed to work to maximum personal benefit.

Does the revised Time Off-Associates Policy apply outside the United States?

The revised policy applies only to associate attorneys in the United States (or in other countries if an attorney’s employment is governed by United States law in this regard) who are engaged in the practice of law. Attorneys in countries other than the United States, whose terms and conditions of employment are governed by the laws of a country other than the United States, are provided vacation in accordance with those laws. Further, only employees of the Firm are covered by this policy; partners, ‘of counsel’ attorneys and independent contractors are not covered.

Who can answer my questions about the Associate Time-Off policy not addressed here?

Questions about the policy can be directed to your local office HR manager or the Firm’s Chief HR Officer.

Earlier: Open Thread: Downsizing the Perks