Posted May 20, 2008 11:20 am CDT
A South Florida law firm hit hard by the real estate downturn has cut its lawyers’ pay by 12 percent.
If its financial situation improves, Becker & Poliakoff will make up for the salary cuts with retroactive pay for lawyers who stick with the firm, the Daily Business Review reports.
Managing shareholder Alan Becker told the publication that the firm brought in about $60 million last year, but clients failed to pay about 4 percent of total billings. The firm had to cut expenses as a result, he said, and it had to focus on staff-related costs since they make up about 70 percent of the firm’s expenses.
“It’s simple math: If X dollars come in, you can’t pay more than X dollars out,” Becker said. “If you want to be conservative and cut costs, there’s not a whole lot of places you can do it—where 70 percent of your expenses is people—except people.”
The firm, based in Fort Lauderdale, focuses on real estate, construction and government law. Becker told lawyers about the pay cut in a podcast last Wednesday.