Biglaw

Billion-Dollar Am Law 50 Firm Walks Back Its COVID-19 Salary Reductions

And bonuses are on the horizon for 'extraordinary' performance.

By Staci Zaretsky on August 20, 2020 2:14 pm

K&L GATES — MEMO RE: SALARY REDUCTION ROLLBACK

To: K&L Gates Colleagues

       I hope that you and your families are all safe and well. I am writing to confirm some of the details of the upward compensation adjustments approved by the Management Committee that I described in the video message posted on Compass earlier today.

      Thanks to your hard work, creativity, ingenuity and resilience, our Firm has performed better than expected to this point throughout the global pandemic. Indeed, it is doing quite well under the circumstances and given the widespread economic distress. Nevertheless, it has been a difficult year and there are continued uncertainties lying ahead; these are unavoidable realities that require continued prudence and diligence. But we have shown as a Firm that we are highly capable of working together to deliver first rate legal advice and work product through the most difficult of circumstances — even through a crises such as the one we are experiencing now.

     Accordingly, given the Firm’s performance to date and looking ahead as best we can through a hazy crystal ball, we have decided that we will relax the Covid-related salary reductions starting in September. The adjustment will be in effect for work performed on and after September 1. Most employees will see a 33% improvement in the previously imposed reductions. Equity partners will see a 25% improvement in the previously imposed reductions. Further details are below:

  1. Our equity partners will continue to lead in this regard, as has been a driving principle from the outset.  Instead of the previously imposed 20% reduction in their normally scheduled advances each month, starting at the end of September the advances will be 15% less than normal, with our Management Committee personnel continuing to take larger reductions.
  2. Most other personnel across the Firm (Income Partners, Associates and Allied Professionals/Staff) previously were taking a 15% reduction in their annualized salary (as permitted by and in accordance with local laws and necessary procedures where required) to the extent they have an annualized salary at or above a pre-determined floor. Given the Firm’s strong performance to this stage, this Covid-reduction will be reduced by 33% to 10% going forward starting with the work period commencing at the beginning of September.
  3. The pre-determined floor will shift upward from $75,000 to $100,000, again subject to appropriate regional differences. Personnel whose pre-reduction compensation was between $75,001 and $100,000 will return to their pre-reduction compensation as of September 1.

Any questions regarding compensation adjustments can be directed to Amy Horn or a member of the HR Business Partner team.

     These levels will be continuously reviewed, with the goal of promptly mitigating further or eliminating reductions as performance and projections warrant.  All personnel will be considered for discretionary bonuses for extraordinary performances or contributions, as many are working very hard through this period and have been making exceptional contributions. Our future depends on our productive and dedicated personnel, and we will not fail to recognize this and act accordingly.

      Our Firm is well-positioned. As we look ahead, we see a bright future and we have learned much about our resilience and abilities as a Firm through a difficult period. Thank you for your extraordinary dedication and loyalty, and for all you are doing. Above all, please keep yourselves and those close to you safe and healthy.

     Jim and Mike

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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