KELLEY DRYE & WARREN — MEMO RE: SALARY CUTS
All –
Kelley Drye, like many law firms and other businesses, is facing unprecedented challenges due to the COVID-19 pandemic. Despite being out of our offices since mid-March, we are working well and efficiently, and our lawyers and timekeepers are providing our clients with quality legal services. We are incredibly proud of all of you.
For the last several weeks, the Executive Committee, Tom Carty, and I have been focused on protecting the financial health of the Firm, mindful of the lawyers, staff, and other professionals who depend upon Kelley Drye for their livelihood. We have acted in accordance with the following objectives as we worked through complex legal and financial issues:
1. Ensure the economic vitality of the Firm, both during the pandemic and in the economy that will emerge after the pandemic;
2. Serve our clients during the disruption; and
3. Recognize that all of us will have to contribute in some way to get through this difficult time.
The Law Firm’s Guide To Trust Accounting And Three-Way Reconciliation
Proper trust accounting and three-way reconciliation are essential for protecting client funds and avoiding serious compliance risks. In this guide, we break down these critical processes and show how legal-specific software can help your firm stay accurate, efficient, and audit-ready.
The economic impact of the coronavirus crisis is beginning. Our clients are focusing on their business needs first, as is expected, and we are seeing a slowdown in payment of our invoices. As a result, and given the uncertainty around when we might return to our offices and when all businesses will be operating at full capacity, Firm management will take the following steps:
• Equity partners’ draws will be reduced on a proportional basis by as much as 20%, effective April 30;
• There will be an across-the-board, prospective salary reduction of 10% for all other lawyers and employees earning over $100,000, effective May 15, 2020. Please note that no one subject to this reduction will be cut below $100,000 annually; and
• The July 1 administrative staff salary increases will be postponed.
These measures will supplement our earlier efforts aimed at cutting expenses. As reported in the April 7 issue of Kelley Community, we shortened the summer program, delayed the start of our first year associate class and postponed non-essential hires. Since then, we have also suspended services provided by non-essential consultants, independent contractors and vendors. Travel expenses, firm events, seminars, recruiting expenses, overtime, and many client development activities have been curtailed by stay at home orders, which will result in expense savings as well. We hope to be in the position to revisit and possibly restore salaries to pre-COVID levels at some point in the future, once the crisis abates and our practice returns to its normal rhythm.
Please note that these actions will not impact promotions of new partners and special counsel, which will occur in the normal course. It’s important that we retain our best and brightest and continue to execute our organic growth strategy and promote from within.
I know you may have specific questions about what these changes mean for you. We are working through the details now, and will communicate further before payroll changes take place. Please reach out to Dana Rosenfeld or me should you have any questions before then.
These are extraordinary times. I’m realizing every day that Kelley Drye is extraordinary, with dedicated people bringing their knowledge, skills, and compassion to the monumental task of managing through this unprecedented event in our lifetimes.
Thank you.
Jim
Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.