Anyone in biglaw get a pay cut?

[Anonymous]

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

Let me take the side of management here. Yes, we're greedy partners - not going to deny that. However, to keep the firm constantly infused with new blood (i.e. new clients, new lateral partners, and top-tier law school grads) we have to be financially-responsible. The vast majority of our clients are cutting their expenses, which includes outside counsel spending. This means that our revenues will be reduced, probably by 20%-30%, so this means we need to cut our own expenses to offset. All large firms are cutting expenses to varying degrees, and so are major companies, with many slashing budgets, freezing hiring and eliminating all but the most essential travel. There is always room in the budget to cut or delay expenses. It doesn't matter that we have cash on hand to weather the current crisis and can continue as if nothing is happening outside our marble-encased lobbies. We would look out of touch, and more importantly, we don't know how long the economic downturn from the corona virus pandemic is going to last.

XOXO - The Partners

P.S. Now, we all known that there is a certain percentage of partners who have been grumbling about high associate pay ever since Gunderson went to $125k for first years back in 1999. This complaint has been around long before that, and will continue long after the current crisis has passed.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Meh, I'm a GC. A big part of the reason I pay biglaw prices is for air cover. You give me and my execs the air cover I think is best.

AARP?

Air cover? That’s new name for it to me. But you waste your company’s money and you are a fool to pay big firm prices for litigation. Big waste.

This isn’t unusual. We (large company) have done this in the past. We just assigned a major case to a small firm who has done a great job on several smaller cases for us. In the past, we would have used a big named firm. We’re getting more price conscious now.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Meh, I'm a GC. A big part of the reason I pay biglaw prices is for air cover. You give me and my execs the air cover I think is best.

AARP?

Air cover? That’s new name for it to me. But you waste your company’s money and you are a fool to pay big firm prices for litigation. Big waste.

This isn’t unusual. We (large company) have done this in the past. We just assigned a major case to a small firm who has done a great job on several smaller cases for us. In the past, we would have used a big named firm. We’re getting more price conscious now.

Not all good lawyers want to be a part of big named firms.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

Let me take the side of management here. Yes, we're greedy partners - not going to deny that. However, to keep the firm constantly infused with new blood (i.e. new clients, new lateral partners, and top-tier law school grads) we have to be financially-responsible. The vast majority of our clients are cutting their expenses, which includes outside counsel spending. This means that our revenues will be reduced, probably by 20%-30%, so this means we need to cut our own expenses to offset. All large firms are cutting expenses to varying degrees, and so are major companies, with many slashing budgets, freezing hiring and eliminating all but the most essential travel. There is always room in the budget to cut or delay expenses. It doesn't matter that we have cash on hand to weather the current crisis and can continue as if nothing is happening outside our marble-encased lobbies. We would look out of touch, and more importantly, we don't know how long the economic downturn from the corona virus pandemic is going to last.

XOXO - The Partners

P.S. Now, we all known that there is a certain percentage of partners who have been grumbling about high associate pay ever since Gunderson went to $125k for first years back in 1999. This complaint has been around long before that, and will continue long after the current crisis has passed.

Maybe it matters to your employees that you're cutting their salaries and jobs when you have cash on hand to pay them?

Have your clients actually told you that they won't be paying your exorbitant fees in full, or are you just assuming? What is your 30-40% estimate in decreased revenue based on? What I hear is: "We're doing this because other big firms are doing this, and maybe we won't have as much as we used to." Just as you are pretending that you have to cut salaries bc of this situation, your clients could be pretending that they can't (won't) pay you bc of this situation.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

This made me LOL. That's exactly how it went.

[Anonymous]

Note to clients of big law firms: you don't need to pay your legal bills in full. The law firms are expecting it and planning for it. So take care of your company and employees first and don't worry about the law firm bills. Just don't go switching firms!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

This made me LOL. That's exactly how it went.

I'm assuming there is a lateral freeze exception for laterals coming with the right clients.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

This made me LOL. That's exactly how it went.

I'm assuming there is a lateral freeze exception for laterals coming with the right clients.

Always. Feeder vs. mouth to feed.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

Let me take the side of management here. Yes, we're greedy partners - not going to deny that. However, to keep the firm constantly infused with new blood (i.e. new clients, new lateral partners, and top-tier law school grads) we have to be financially-responsible. The vast majority of our clients are cutting their expenses, which includes outside counsel spending. This means that our revenues will be reduced, probably by 20%-30%, so this means we need to cut our own expenses to offset. All large firms are cutting expenses to varying degrees, and so are major companies, with many slashing budgets, freezing hiring and eliminating all but the most essential travel. There is always room in the budget to cut or delay expenses. It doesn't matter that we have cash on hand to weather the current crisis and can continue as if nothing is happening outside our marble-encased lobbies. We would look out of touch, and more importantly, we don't know how long the economic downturn from the corona virus pandemic is going to last.

XOXO - The Partners

P.S. Now, we all known that there is a certain percentage of partners who have been grumbling about high associate pay ever since Gunderson went to $125k for first years back in 1999. This complaint has been around long before that, and will continue long after the current crisis has passed.

Maybe it matters to your employees that you're cutting their salaries and jobs when you have cash on hand to pay them?

Have your clients actually told you that they won't be paying your exorbitant fees in full, or are you just assuming? What is your 30-40% estimate in decreased revenue based on? What I hear is: "We're doing this because other big firms are doing this, and maybe we won't have as much as we used to." Just as you are pretending that you have to cut salaries bc of this situation, your clients could be pretending that they can't (won't) pay you bc of this situation.

If you wait until the numbers drop, it's too late. Try thinking like a business owner, rather than an employee. You're assuming that partners are only thinking of themselves, rather than the viability of the firm itself. History is resplendent with examples of the former that are now failed firms.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

Let me take the side of management here. Yes, we're greedy partners - not going to deny that. However, to keep the firm constantly infused with new blood (i.e. new clients, new lateral partners, and top-tier law school grads) we have to be financially-responsible. The vast majority of our clients are cutting their expenses, which includes outside counsel spending. This means that our revenues will be reduced, probably by 20%-30%, so this means we need to cut our own expenses to offset. All large firms are cutting expenses to varying degrees, and so are major companies, with many slashing budgets, freezing hiring and eliminating all but the most essential travel. There is always room in the budget to cut or delay expenses. It doesn't matter that we have cash on hand to weather the current crisis and can continue as if nothing is happening outside our marble-encased lobbies. We would look out of touch, and more importantly, we don't know how long the economic downturn from the corona virus pandemic is going to last.

XOXO - The Partners

P.S. Now, we all known that there is a certain percentage of partners who have been grumbling about high associate pay ever since Gunderson went to $125k for first years back in 1999. This complaint has been around long before that, and will continue long after the current crisis has passed.

Maybe it matters to your employees that you're cutting their salaries and jobs when you have cash on hand to pay them?

Have your clients actually told you that they won't be paying your exorbitant fees in full, or are you just assuming? What is your 30-40% estimate in decreased revenue based on? What I hear is: "We're doing this because other big firms are doing this, and maybe we won't have as much as we used to." Just as you are pretending that you have to cut salaries bc of this situation, your clients could be pretending that they can't (won't) pay you bc of this situation.

If you wait until the numbers drop, it's too late. Try thinking like a business owner, rather than an employee. You're assuming that partners are only thinking of themselves, rather than the viability of the firm itself. History is resplendent with examples of the former that are now failed firms.

If you have to preemptively cut staff and salaries before you actually experience any downturn, then your profit margin is too narrow (but that's not true, is it?) or your overhead is too high.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

Let me take the side of management here. Yes, we're greedy partners - not going to deny that. However, to keep the firm constantly infused with new blood (i.e. new clients, new lateral partners, and top-tier law school grads) we have to be financially-responsible. The vast majority of our clients are cutting their expenses, which includes outside counsel spending. This means that our revenues will be reduced, probably by 20%-30%, so this means we need to cut our own expenses to offset. All large firms are cutting expenses to varying degrees, and so are major companies, with many slashing budgets, freezing hiring and eliminating all but the most essential travel. There is always room in the budget to cut or delay expenses. It doesn't matter that we have cash on hand to weather the current crisis and can continue as if nothing is happening outside our marble-encased lobbies. We would look out of touch, and more importantly, we don't know how long the economic downturn from the corona virus pandemic is going to last.

XOXO - The Partners

P.S. Now, we all known that there is a certain percentage of partners who have been grumbling about high associate pay ever since Gunderson went to $125k for first years back in 1999. This complaint has been around long before that, and will continue long after the current crisis has passed.

When partners cut all expenses before their own draws, it seems like they are thinking of themselves first. I know my firm has a line of credit it used to pay the monthly draws, and then uses what we collect in fees to pay off the line. If the firm is putting the business first, then they would use less of the credit and reduce the monthly draws well before they fire associates.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Firm is doing great. Hopeful anecdote. Delayed distribution. Cuts to summer program. Hiring and lateral freeze. Considering reducing associate pay. Poor, poor outsourced staff. Get your hours in and your bills out. Firm is doing great.

Haha so true “we planned ahead and we are stable... but we are asking you to do certain things...”

Let me take the side of management here. Yes, we're greedy partners - not going to deny that. However, to keep the firm constantly infused with new blood (i.e. new clients, new lateral partners, and top-tier law school grads) we have to be financially-responsible. The vast majority of our clients are cutting their expenses, which includes outside counsel spending. This means that our revenues will be reduced, probably by 20%-30%, so this means we need to cut our own expenses to offset. All large firms are cutting expenses to varying degrees, and so are major companies, with many slashing budgets, freezing hiring and eliminating all but the most essential travel. There is always room in the budget to cut or delay expenses. It doesn't matter that we have cash on hand to weather the current crisis and can continue as if nothing is happening outside our marble-encased lobbies. We would look out of touch, and more importantly, we don't know how long the economic downturn from the corona virus pandemic is going to last.

XOXO - The Partners

P.S. Now, we all known that there is a certain percentage of partners who have been grumbling about high associate pay ever since Gunderson went to $125k for first years back in 1999. This complaint has been around long before that, and will continue long after the current crisis has passed.

When partners cut all expenses before their own draws, it seems like they are thinking of themselves first. I know my firm has a line of credit it used to pay the monthly draws, and then uses what we collect in fees to pay off the line. If the firm is putting the business first, then they would use less of the credit and reduce the monthly draws well before they fire associates.

Seems like???

[Anonymous]

Anonymous wrote:

Anonymous wrote:What kind of changes, client? A lot of the inefficiency and wasted hours on tasks that really don’t need to be done in big law is client-driven. I’m in litigation.

That's what firms often say, but it isn't necessarily true. Firms often want to run down every potential rat hole to avoid allegations of malpractice.

...often based on experience with /conduct of clients who didn’t like a result, etc., then snap back at counsel as scapegoat ... hence the need to proactively practice. I reject the client caterwauling to some degree when it’s client behavior that helped drive the model.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What kind of changes, client? A lot of the inefficiency and wasted hours on tasks that really don’t need to be done in big law is client-driven. I’m in litigation.

That's what firms often say, but it isn't necessarily true. Firms often want to run down every potential rat hole to avoid allegations of malpractice.

...often based on experience with /conduct of clients who didn’t like a result, etc., then snap back at counsel as scapegoat ... hence the need to proactively practice. I reject the client caterwauling to some degree when it’s client behavior that helped drive the model.

P.s., having said that, no way am I defending Biglaw, far from it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What kind of changes, client? A lot of the inefficiency and wasted hours on tasks that really don’t need to be done in big law is client-driven. I’m in litigation.

That's what firms often say, but it isn't necessarily true. Firms often want to run down every potential rat hole to avoid allegations of malpractice.

...often based on experience with /conduct of clients who didn’t like a result, etc., then snap back at counsel as scapegoat ... hence the need to proactively practice. I reject the client caterwauling to some degree when it’s client behavior that helped drive the model.

+1. I’m in a practice area that depends on continued business from existing client rather than a constant turnover of clients with one-off matters. Our clients are very cost conscious and will protest anything that seems remotely unnecessary in hindsight, but would flip their shit if we missed something because we weren’t sufficient proactive in anticipating issues. Net result is that our files tend to heavily documented with emails notifying clients of potential issues and asking if they would like us to review further. We do some amount of review to assess how likely it is to be an issue (because we don’t want to be accused later of downplaying major issues), but that time gets lumped in with some other task with a general task description so clients will pay. It’s all a big game of finessing the bills so they don’t object to work that needs to be done but that clients will object to paying for.