2 BigLaw firms reject routine special bonuses as several boutiques match or surpass market rate
Above the Law’s bonus tracker continues to expand, as an increasing number of boutique law firms announce associate bonuses that match or surpass market rates set by Milbank. But some BigLaw firms are not falling in line with the standard special bonuses. (Image from Shutterstock)
Above the Law’s bonus tracker continues to expand, as an increasing number of boutique law firms announce associate bonuses that match or surpass market rates set by Milbank.
About 50 firms were on the bonus list when it was last updated Dec. 12, including nine boutique firms. At least five more boutiques announced bonuses since then, as chronicled in separate Above the Law posts.
One of them is Susman Godfrey, which “absolutely blows away the current market standard,” Above the Law reports.
Law.com and Law360 also have coverage.
The market rate for year-end bonuses is $15,000 to $115,000, while the going rate for additional special bonuses is $6,000 to $25,000. That makes the total bonus $21,000 for the class of 2024 to $140,000 for the class of 2016 and beyond.
Susman Godfrey is paying median bonuses ranging from $110,000 to $220,000. All 286 of the firm’s employees are also receiving bonuses.
Not to be outdone, midsize firm Boies Schiller Flexner previously announced that “multiple associates” at the firm are receiving bonuses of $1 million or more this year. In addition, “numerous associates” received above-market bonuses, including several who received $300,000 or more. The outsized bonuses are being paid to associates who opted for a bonus formula with a revenue-share component, rather than market-rate bonuses.
Other boutiques that have announced above-market bonuses include Selendy Gay (with combined bonuses ranging from $23,250 to $157,250) and Wilkinson Stekloff (with combined bonuses ranging from $28,500 to $197,500).
While above-market bonuses by those firms are “not a new phenomenon,” Law.com reports, the number of others offering “eye-popping bonuses appears to be growing.”
Boutique firms are in a better position to offer above-market bonuses because their overhead is lower than that of BigLaw firms, said Jeff Lowe, a Washington, D.C., recruiter with legal search company CenterPeak, in an interview with Law.com The pool of associates who will receive the bonuses is also smaller, Lowe pointed out.
Some BigLaw firms, meanwhile, are not falling in line with the standard special bonuses that range from $6,000 to $25,000, report Bloomberg Law and Above the Law (here and here). The latest firms that aren’t paying routine special bonuses are Perkins Coie and Hogan Lovells.
While Hogan Lovells isn’t paying the routine special bonuses, it will pay additional bonuses to associates who exceed minimum hours.
Other firms requiring an hourly minimum for special bonuses include Covington & Burling, Fish & Richardson, Katten Muchin Rosenman, Norton Rose Fulbright, Pillsbury Winthrop Shaw Pittman (paying “super bonuses” to high billers), Seward & Kissel and Sidley Austin, according to previous coverage.
Bonus decisions are being made amid a “muted” market for associates following talent wars in 2021, Bloomberg Law points out. Then came a period of cutbacks that brought some associate layoffs.
Now, firms are realistically looking at what they can afford, said Katherine Loanzon, a managing director at search company Kinney Recruiting, in an interview with Bloomberg Law.
“Firms just don’t feel the pressure anymore to follow,” Loanzon told Bloomberg Law.
