April 27, 2020

Protecting Our Business and Our People

Colleagues:

Your perseverance and resilience during these disruptive times have been deeply appreciated. This challenging period has brought out the best in our people, who continue to be invaluable members of the Baker Botts team.

The upheaval created by the pandemic has also imposed unprecedented financial strain on our clients and the global economy. As with many other law firms, we also must act prudently to protect the financial health of the Firm and protect our people. This means taking measures to help avoid layoffs and preserve the income of our most vulnerable employees.

To do this, our partners have agreed to compensation reductions to absorb the bulk of the financial impact expected from the pandemic. In addition, we have made the difficult but necessary decision to reduce salaries temporarily. Effective May 1, salaries for lawyers and staff will be reduced by the following amounts:

·         Counsel: 20 to 30% (based on salary level)

·         Associates: 20%

·         Staff: 0 to 25% (based on salary level)

Please note that we will not be reducing salaries for employees earning less than $70,000 per year. Those of you with salary reductions will each receive an email shortly from Payroll Services setting forth your current and temporarily adjusted compensation amount. These salary reductions will remain in effect until July 31, after which we will determine the appropriate course forward.

In the meantime, the Firm will evaluate and potentially award interim bonuses to exceptional contributors, based on both individual performance and economic and Firm conditions. Associate and counsel eligibility will be determined based on contributions to our clients and Firm, including both utilization and exemplary client service.

Further, we have informed our new class of associates who were scheduled to start with us this fall that their start date has been deferred to 2021.

We are in this together and will proceed under a principle of “collective sacrifice” as we continue to work collaboratively for our clients, while protecting the long-term health of the Firm and our tremendous talent.

I am grateful for all you do to make Baker Botts an extraordinary law firm, and I look forward to communicating with you again soon.

Until then, please continue to take care of yourselves and your families.

John