Lawyer Pay
Real Estate Firm Cuts Lawyer Pay by 12 Percent
Posted May 20, 2008, 06:20 am CDT
By Debra Cassens Weiss
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.
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Comments
Posted by JS - 4 months, 3 weeks, 1 day, 45 minutes ago
The best part of this story about Becker & Poliakoff is that they are trying to work with their clients who have been hardest hit by the economy instead of just cutting the clients loose. But I do not think that the associates should have to foot the bill for this. The associates are not guaranteed a share of the profits in the good years, so they should not be forced to bear the financial burden in the bad years. That is part of what it means to be a shareholder / equity partner.
Posted by seriously? - 4 months, 3 weeks, 13 hours, 56 minutes ago
My favorite part was that they told the associates in a podcast. I’m not sure how big the firm is, but surely they could have arranged face-to-face meetings, even if they had to hold a number of them? Kind of like breaking up with your boyfriend over e-mail…
Posted by associate - 4 months, 2 weeks, 6 days, 41 minutes ago
It’s not even as personal as email. More like breaking up with someone via a blog entry on facebook or myspace.
Email implies a communication sent directly to an affected individual. The podcast is more like a website posting.
Posted by Socorro - 4 months, 2 weeks, 3 days, 19 hours, 15 minutes ago
What I loved most about this article is that this is the same partner who wrote, published and is now selling his “great book” on how there is room at the top for whoever wants to succeed. Then, when the partners or their staff fail to select the right clients or collect, they cut the associates salaries. Announcing the cuts through a podcast? how touching!