Associate Pay Hikes Create New Problem: Lower-Paid Partners
Some senior associates are making more money than nonequity partners, forcing law firms to re-evaluate—and in some cases boost—partner pay and bonuses.
Legal Times cites pay at Arent Fox to illustrate the problem. Senior associates there can earn up to $280,000 in base pay and $100,000 in bonuses, for a total of $380,000. First-year nonequity partners earn $310,000 in base pay and then contribute $20,000 for their benefits, putting their base pay at $290,000.
As a result of the inequity, Arent Fox gave partners $50,000 in stock and a minimum $27,000 bonus, putting total compensation for nonequity partners at $367,000, still a bit below that of associates who make top bonuses.
Other firms that have responded to the problem by boosting partner pay include Wiley Rein, which pays new partners about $320,000, and Hogan & Hartson, which pays junior partners about $400,000, the article says.
Law firm consultant Ward Bower of Altman Weil told Legal Times that law firms paying high associate wages are struggling to keep partners happy. “What they really want to protect is the income of their biggest partners,” he said, “which means the partners at the bottom of the scale are caught in a tough position.”
