Biglaw Firm Announces Bonuses, But Not Every Associate Is Taking Home Money

This memo outlines the 2018 bonus determinations, 2019 base salaries, and bonus eligibility considerations for 2019.

2018 Bonus

Associates in good standing who met the 1,950-hour threshold during our fiscal year ending September 30, 2018 are eligible to receive bonuses.  Because bonuses are based on performance during our fiscal year ending September 30, 2018, associates hired after August 31, 2018 (including the Class of 2018) are not eligible to receive bonuses.

The 2018 U.S. associate bonuses are determined by reference to the bonus scale set forth below.  As in past years, individual bonus awards may be above or below these “class” amounts based on a determination by ARC as described in more detail below.  Evaluations are based on reviews written by supervising partners and associates and on the attorney frameworks for each level of seniority.

All senior and mid-level associates who received a Successfully Achieves Frameworks rating will receive the full class amount starting at the lowest hour range.  In addition, associates who record ARC hours materially higher than 1,950 hours and associates who received a Distinctive rating will receive bonuses above their class amounts.  Only associates receiving a Below Frameworks rating will receive less than the full class amount.

This year ARC will not give ratings to junior associates (classes of 2016 and 2017) except for associates who perform below the frameworks set forth for junior associates.  We have determined that focusing on feedback and development is more appropriate for associates beginning their legal careers.  Junior associates who met the 1,950 ARC hours threshold will receive the full class bonus amount unless they are performing below frameworks (in which case they will receive less than the full class amount).  Those who materially exceeded the hours threshold will receive higher bonuses.

This year, 83% of associates are eligible to receive bonuses.  Of those receiving bonuses, 37% will receive an amount greater than the amount listed for their class, 60% will receive their class amount, and 3% will receive less than their class amount.

Class Year Bonus Amounts – 2018

Bonuses will be pro-rated for recent hires during calendar year 2018. Consistent with the firm’s policy for leaves of absence and flex time arrangements, bonuses will be pro-rated for leaves and reduced-hours arrangements during fiscal year 2018.  Bonuses will be paid by direct deposit on January 25.

2019 U.S. Associate Base Compensation Levels

Our base salary scale for U.S.-based associates will remain the same in 2019.  We will recognize and reward our salaried associates in good standing for their contributions through the class year increases to their applicable base salary listed below.  The class year increases will be effective January 1, 2019, and will be reflected in the January 25 monthly paycheck.

Communication

Base salary increases and bonus awards will be set forth in memoranda delivered by interoffice mail to each associate on January 24, 2019.

Bonus Eligibility for 2019

For bonus eligibility in 2019, we will continue to require associates to bill at least 1,950 hours during the fiscal year to: billable hours, pro bono hours, legal services on behalf of the firm, and shadow training under the firm’s shadow training policy.  Associates whose performance falls below the frameworks established for their level may not be eligible to receive a bonus.

Pro Bono and Investment Time

The firm remains committed to the Pro Bono Institute Pledge of dedicating 3% to 5% of its annual billable hours to legal matters on behalf of people in poverty or to advance civil rights.  Accordingly, we ask all of the firm’s lawyers to commit at least 50 hours annually to pro bono.  For bonus purposes, pro bono hours are treated the same as billable hours.  At the end of this fiscal year, you will be asked to discuss your pro bono commitment in your Professional Development Report.

The firm also expects attorneys to collaborate through investment (or “91”) time matters, including marketing activities, knowledge management, Business Unit and Legal Practice Area initiatives, diversity initiatives, training and participation on firm committees.  Collaboration and active participation in our community are core values of our firm and are included in the attorney frameworks setting forth our expectations for junior, mid-level and senior associates.  Associates should seek opportunities to participate in 91-matters, particularly during times when they are less busy with billable or pro bono work.  In 2019, ARC will continue to focus on the quality, not the quantity, of these efforts.

Please do not hesitate to call me, Heidi Goldstein Shepherd, any ARC member or your Office, Department, BU or Legal Practice leaders, with any questions or comments.

Again, thank you for your efforts and contributions to the firm.