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Law Practice Management

DLA Piper Cuts Starting Pay to $145K, Apparently May Eliminate Lockstep

Posted May 15, 2009 4:12 PM CDT
By Martha Neil

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A major BigLaw firm has joined a small but growing list of well-known law firms that have recently announced associate salary reductions.

Plus, DLA Piper is also imposing salary cuts on more senior associates and moving away from a traditional lockstep compensation scheme in which all attorneys who graduated from law school in the same year get the same salary. The pay cuts are announced in an internal memo today that was obtained by Above the Law.

The starting salary for first-years will be reduced to $145,000 in "major markets" and reduced to $130,000 in areas where it is already $145,000, the memo states. Meanwhile, "adjustments to all associate salaries at other class levels will be determined and communicated on a case-by-case basis based on class year and performance levels."

In case this language is not understood as a potential death knell for lockstep compensation, the memo further clarifies this point: "We intend to accelerate our consideration of potential alternative structures for associate advancement and compensation beyond basing them primarily on time out of law school," it continues.

As the memo points out, DLA Piper's associate pay cuts follow partner cuts and capital calls first announced last year.

The associate pay cuts will permit the firm to reward top performers while at the same time meeting client expectations of value and extraordinary service, the memo states.

Related earlier coverage:

ABAJournal.com: "DLA Piper Asks 275 Non-Equity Partners to Ante Up, Goes to 1-Tier Structure"

ABAJournal.com: "Under 1-tier Structure, DLA’s Equity Partner Count Jumps from 300 to 670"

ABAJournal.com: "DLA Piper Will Cut Pay for Most Partners by 11.5 Percent"

ABAJournal.com: "Cyclical Downturn or Paradigm Shift? BigLaw Leaders Aren’t Sure"

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