Biglaw, Killing Lockstep

Orrick Ends Lockstep

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Biglaw firms have been talking about moving away from lockstep since the start of the recession. Orrick’s Managing Partner, Ralph Baxter, has been talking about it since before the recession.
Next year, Orrick will be doing it. Instead of a lockstep system, the firm will introduce three different levels for associates. Here is the how the firm describes the change in its official press release:

Orrick will replace the automatic lockstep advancement model for its partner track associates with a model that allows associates to advance at a pace that reflects their developing skill set.
The firm will have three levels of associates – Associate, Managing Associate, and Senior Associate – with well-defined performance criteria for advancement from one level to the next and with corresponding compensation levels. To implement this program, the firm is enhancing its associate training, mentoring, and feedback systems.
“The traditional associate lockstep staffing and compensation model is based upon out-dated assumptions,” said Laura Saklad, Orrick’s Chief Lawyer Development Officer. “Our new Talent Model recognizes that not all associates advance at the same pace, tenure is not a proxy for advancing skill, and clients should not bear the cost of training associates. In the end, our goal is to deploy the right lawyer or professional for the right task at the right cost. ”

The three classes apply only to “partner track” associates. What are non-partner track associates going to get? More details and an opportunity to provide some instant feedback via a reader poll, after the jump.


Not every lawyer has a snowball’s chance in hell wants to make partner. For those associates, here’s what Orrick is offering:

As part of Orrick’s continuing focus on reengineering its approach to legal work, the firm is creating Career Attorney and Legal Team Professional roles. These roles will enable the firm to leverage and expand the services and capabilities that the firm already provides its clients from the Global Operations Center in Wheeling, West Virginia. In every area of practice, the firm has sought to identify tasks and processes that can be disaggregated from the delivery of high-value legal advice and executed in an integrated, seamless and efficient manner by specialists and other lower cost resources. These roles include project managers, document reviewers, compliance specialists, due diligence specialists, document assemblers, and legal researchers.
The Custom Track creates roles for lawyers who have outstanding skills yet desire a less traditional path to partnership or do not aspire to partnership at all. Associates on the Custom Track will be able to set a different pace for advancement or customize a long-term role that enables them to contribute in a meaningful way but does not necessarily lead toward partnership with the firm. Associates on the Custom Track may return to the Partner Track.

Prospective attorneys didn’t respond too kindly to Orrick’s Wheeling option when we reported on it, back in March. We’ll have to see how that pans out heading into 2010.
So, what will Orrick be paying all these new classes of employees? …? Buehler? Frye?
Orrick wasn’t able to respond to our immediate request for more information about the 2010 compensation structure. The WSJ Law Blog has this to say about future salaries at Orrick:

Orrick will adopt a new comp schedule in 2010. The “custom” track lawyers will be paid some amount less than the “partner” track lawyers. In addition, Handley says, bonuses will make up a larger percentage of associates’ overall compensation. Bonuses, she says, will not be tied as directly to hours billed as they were in the past. “Productivity will be considered [in awarding bonuses], but it will be considered along with other factors, such as efficiency and overall contribution to the firm,” [Siobhan Handley, Orrick’s Managing Partner for Innovation] says. “The goal [of the new program] is not a reduction in associate compensation.”

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Orrick has undergone a couple of rounds of layoffs, but the firm hasn’t cut salaries. Should prospective Orrick first years count on making $160,000 in base starting salary next year?
Now that one firm has officially abandoned lockstep compensation, what do you think? Take the poll below and provide some instant feedback for a lot of managing partners that will be trying to gauge how Orrick’s actions will play among new recruits and lateral hires.

Read the full press release below:
ORRICK — STATEMENT — NEW TALENT MODEL
Orrick Announces New Talent Model
A Revolutionary Change in Approach to Client Service and Lawyer Development
New York – Orrick, Herrington & Sutcliffe introduces today a new Talent Model that promises to reengineer the way the law firm delivers high value legal service. The new model combines a move away from traditional lockstep advancement for partner track associates with the creation of a variety of other novel legal roles.
“We are confident that our new model is the way of the future,” said Ralph Baxter, Orrick’s Chairman and CEO. “At Orrick, we are working closely with our clients to bring greater innovation and efficiency to the delivery for high value legal work. Bringing the law firm talent model into the 21st century is key to this objective. We believe our new approach to developing the lawyers of tomorrow and reengineering the way we staff complex matters is one of the most comprehensive and exciting changes in the profession today.”
The new model establishes three tracks of lawyers and other professionals and staff: Partner Track Associates, Career Attorneys and Legal Team Professionals, and Custom Track Associates.
“Our new Talent Model is designed to allow associates to advance at a rate that reflects their growing skills and value,” said Siobhan Handley, Orrick’s Managing Partner for Innovation. “It will create a clearer and more understandable path to partnership, provide greater flexibility in the way we staff engagements, and create long-term opportunities for the best associates who may not want to be partners.”
Moving Away from Lockstep Advancement: Partner Track Associates
Orrick will replace the automatic lockstep advancement model for its partner track associates with a model that allows associates to advance at a pace that reflects their developing skill set.
The firm will have three levels of associates – Associate, Managing Associate, and Senior Associate – with well-defined performance criteria for advancement from one level to the next and with corresponding compensation levels. To implement this program, the firm is enhancing its associate training, mentoring, and feedback systems.
“The traditional associate lockstep staffing and compensation model is based upon out-dated assumptions,” said Laura Saklad, Orrick’s Chief Lawyer Development Officer. “Our new Talent Model recognizes that not all associates advance at the same pace, tenure is not a proxy for advancing skill, and clients should not bear the cost of training associates. In the end, our goal is to deploy the right lawyer or professional for the right task at the right cost. ”
Other Novel Roles: Career Attorneys & Legal Team Professionals and Custom Track Associates
As part of Orrick’s continuing focus on reengineering its approach to legal work, the firm is creating Career Attorney and Legal Team Professional roles. These roles will enable the firm to leverage and expand the services and capabilities that the firm already provides its clients from the Global Operations Center in Wheeling, West Virginia. In every area of practice, the firm has sought to identify tasks and processes that can be disaggregated from the delivery of high-value legal advice and executed in an integrated, seamless and efficient manner by specialists and other lower cost resources. These roles include project managers, document reviewers, compliance specialists, due diligence specialists, document assemblers, and legal researchers.
The Custom Track creates roles for lawyers who have outstanding skills yet desire a less traditional path to partnership or do not aspire to partnership at all. Associates on the Custom Track will be able to set a different pace for advancement or customize a long-term role that enables them to contribute in a meaningful way but does not necessarily lead toward partnership with the firm. Associates on the Custom Track may return to the Partner Track.
Orrick Gives the Boot to Lockstep-Associate Model [WSJ Law Blog]
Earlier: Sign of the Times: Orrick Offers Jobs in Wheeling, WV to GULC Students
Nationwide Layoff Watch: The Orrick 300

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