Curbs on pay guarantees don't crimp lateral moves; which firms gained the most?
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Lateral moves by partners at America’s 200 largest law firms increased last year, even as the firms curbed pay guarantees for new partner hires.
In the year ending on Sept. 30, 2014, there were 2,736 lateral moves at top law firms, nearing the record high of 2,775 lateral moves during the same time period in 2009, the American Lawyer (sub. req.) reports. The numbers include partner defections after the merger of Squire Sanders and Patton Boggs. But the numbers don’t include the mass exodus of 226 Bingham McCutchen partners to Morgan Lewis & Bockius.
Experts tell the American Lawyer that law firms are limiting pay guarantees after reports that high lateral salaries contributed to the downfalls of Dewey & LeBoeuf and Bingham McCutchen.
Los Angeles recruiter Michael Allen told the American Lawyer that firm leaders are becoming more conservative on pay commitments to marquee laterals. “In the past, it may have been a three-year commitment with guaranteed salary,” said Allen, managing principal of Lateral Link. “They were stuck when the partners didn’t perform as anticipated. Now, at most it is 18 months or so.”
The law firms with the largest percentage of departing partners were: McKenna, Long & Aldridge, with 59 departures, (22.3 percent of its total partnership); Patton Boggs, before its merger with Squire Sanders, with 37 departures (19.1 percent); Bingham McCutchen, with 51 departures apart from the mass exodus to Morgan Lewis (17.1 percent of its partnership); Jenner & Block, with 32 departures (15.8 percent of the partnership); and Steptoe & Johnson, with 20 departures (14.4 percent of the partnership).
Firms with the largest percentage gains were: Akerman, with 39 hires (14.2 percent of the partnership); Polsinelli, with 49 hires (13.8 percent of the partnership); Akin Gump, with 42 hires (13.6 percent of the partnership); LeClairRyan, with 28 hires (12.9 percent of the partnership); and Hogan Lovells, with 91 hires (11.4 percent of the partnership).
