Biglaw

Am Law 200 Firm Puts Its Employees On Ice With Furloughs, Salary Cuts

We hope those affected are able to get the support they need during these uncertain times.

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The concerning financial consequences of the coronavirus pandemic have resulted in layoffs, furloughs, and salary adjustments across all avenues of employment, but when it comes to the legal sector, the cuts have been deep. Dozens of firms have tightened their belts to prepare for the loss of cash this will cause them, and legal professionals ranging from staff members to equity partners have been squeezed.

We’ve been tracking exactly how this is playing out, and now we’ve got news on some adverse employment action from a place that sounds more like a beer than a law firm. Crack open a cold one, because here come some more furloughs and salary cuts.

Sources tell us that Ice Miller, an Am Law 200 firm, has conducted furloughs among the members of its staff, but that attorney furloughs haven’t been contemplated. The firm will also be cutting salaries across the board, and everyone was notified of these adjustments via conference call from Steve Humke, the firm’s chief managing partner. Here’s a statement on the firm’s cost-cutting measures from Humke:

This morning, I announced that Ice Miller would be enacting several measures to help ensure that the Firm’s position remains strong through the economic crisis caused by COVID-19. First, we have made the difficult decision to furlough 35 professional staff and timekeepers. Eighteen of our furloughed team members are professional staff. The rest are timekeepers. None are partners.

Second, we are temporarily adjusting compensation for all team members who make more than $50,000 per year. The amount of compensation reduction corresponds to team members’ compensation levels. No individual’s compensation will fall below $50,000 per year, and our partners will take the greatest reductions. Our intention is to raise all team members back to their regular compensation levels as soon as market forces allow. We believe that these measures are very much in line with others in our industry. Unlike many firms, Ice Miller has historically operated without reliance on a line of credit and does not hold back a significant portion of partner compensation for future distribution. Our partners share in the Firm’s profits each month after expenses are paid. This practice has given us a strong balance sheet entering into this crisis and positioned us well to continue to provide employment to our team members and excellent service to our clients. Since our partners don’t receive a smaller draw and a larger year-end payout, we think our partner compensation adjustment is in line with other firms who are on a draw system that have announced temporary reductions in partner compensation.

We believe that the compensation adjustments are necessary in order to protect the operating capital of the law firm and preserve jobs, while remaining a strong business partner for our clients. We understand that many of our clients have been hit especially hard by this crisis and are taking their own steps to protect their financial positions. Our commitment to our valued clients is as strong in difficult times as it is in times of plenty.

“I’m proud of our whole Ice Miller team,” Humke said, “who are sharing in the sacrifices necessary to support our clients through this unprecedented crisis.” We hope those affected at the firm are able to get the support they need.

If your firm or organization is slashing salaries, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).

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Staci ZaretskyStaci 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.

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