Pay Cuts Accelerate at Law Firms Across the Country
Posted Jun 30, 2009 4:18 PM CST
By Martha Neil
News today that Schnader Harrison Segal & Lewis is cutting associate—and partner—pay is the latest in a series of announcements that seem to signal a seismic shift in the way well-known law firms are managing corporate law practice.
Even though the firm is on budget for the year, Schnader Harrison is chopping $10,000 from all associate salaries, and partners have also agreed to cut their own pay by 5 percent.
With the announcement, Schader becomes at least the fifth Pennsylvania-based firm to change its compensation scheme in some manner in recent weeks, according to the Legal Intelligencer. But Pennsylvania's legal market is hardly alone.
Firms across the country are implementing temporary and permanent pay cuts for associates, and in some cases, partners.
They include: Buchanan Ingersoll & Rooney; DLA Piper; Dorsey & Whitney; Drinker Biddle; Gray Plant Mooty; Howrey; Kaye Scholer; Kilpatrick Stockton; Pillsbury Winthrop Shaw Pittman; Snell & Wilmer; and Venable.
Last week, Venable revealed that associates will take a pay cut of 8 to 9 percent, effective July 11.
Why are so many law firms suddenly cutting attorney pay?
At least arguably, they can economize in this manner because of the difficulties many lawyers would face trying to find another job amid dismal economic conditions.
But the bottom line for many firms may be that this is a must-do if they are to compete effectively with other law firms that are cutting costs in order to retain corporate clients that are pressuring for more value for their legal representation dollar.
Additional coverage from ABAJournal.com:
Updated on July 1 to add link to subsequent ABAJournal.com post.