And yet another sure sign that the rules of the game have changed for the big law firms that have dominated the legal landscape over the past decades, Latham & Watkins has now capped associate salaries in 2009. That means that associates will get the same pay next year as they received last year. One legal recruiter notes that the move is unprecedented and that we should expect other large firms to now follow suit.
In the article titled "Law firms move to hold down pay for associates", San Francisco Business Times Reporter Eric Young reports on the recent moves law firms have taken during these challenging economic times.
Bryan Cave, LLP to freeze associate pay beginning 2009
“We are operating in an unusually turbulent economic environment,” firm management told associates in an email. The firm is taking other steps to conserve cash, including limiting travel, restricting staff hiring and renegotiating vendor agreements.
Reed Smith, LLP will be giving associate raises, though much lower than in previous years.
“As is prudent, we approached our annual salary review process fully aware that, going into 2009, it would not be ‘business as usual,’ and so, we have managed this process responsibly,” the firm wrote in an email.
The firm Orrick Herrington & Sutcliffe, LLP is considering moving from a lock-step associate pay system to a merit-based pay system.
“This downturn,” Whitescarver said, “has added to the urgency, and my sense is that in 2009 a number of firms will make the change from a lock-step to a merit-based system.”