It’s always a little bit weird when industry-wide raises go public, because the people who have to pay for those raises are put on notice to where their fees are going. Like, when the price of gas goes up, that’s one thing. When the price of gas goes up and Exxon announces a billion-dollar bonus pool, it’s a bit more frustrating. You pay, because you need the gas, but you are also secretly thinking about dousing the corporate board in crude oil and throwing them a match.
I imagine this is how in-house counsel feel about the new Milbank scale and everybody’s rush to match salaries. They know they’re going to have to pay for it, eventually. The Zeughauser Group has already noted how Biglaw’s clients are “scratching their heads” at this round of raises.
It’s pretty common for in-house lawyers to grumble publicly about Biglaw raises.
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But privately? Unless you are the actual general counsel, the person who has to justify your budget to a corporate CEO who probably hates lawyers and doesn’t understand why they cost so much, Biglaw raises aren’t bad for rank-and-file lawyers working on the inside.
For one thing, it’s not your money. If Milbank starts charging a little more for the work Milbank does, it’s not coming out of your paycheck. In fact, a rising salary tide raises the premium on your services. We know that Biglaw raises are inspired by competition… not between Biglaw firms which exist in a largely collusive environment (“you’re welcome” from your friends at Above the Law). But competition with major companies who poach their talent. If Biglaw starts paying $190K, it’ll cost that much more for a Fortune 500 company to hire a lawyer, which is good for the in-house industry.
And if the higher fees make banks and companies scale back on hiring outside counsel, that means more work, but also more job security for the people already in-house.
What do you in-house types think? The positives I’m suggesting are really focused on lower-level in-house lawyers and associates thinking about making the jump. At the general counsel level, these raises have to piss you off. Right?
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Elie Mystal is the Executive Editor of Above the Law and the Legal Editor for More Perfect. He can be reached @ElieNYC on Twitter, or at [email protected]. He will resist.