It was another bad week for many BigLaw lawyers and staffers; who saw pay cuts and furloughs?
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It’s not over, by any means. It has been a week since the ABA Journal reported on the latest large and midsized law firms to cut pay, reduce partner draws, and furlough or lay off staff because of the COVID-19 pandemic. Since then, at least 15 more law firms took temporary steps to reduce costs.
Above the Law and Law.com are keeping running tallies. At last count, they each listed more than 60 law firms total on their furlough and pay cut trackers. Past ABA Journal stories on the trend are here, here and here.
Many law firms instituting cuts have learned from the last time that they laid off staff during the recession that began in 2008, according to Law.com. This time, many firms are transparent about their actions and are sharing sacrifices among lawyers and staff members.
Firms are also taking different measures. Many are cutting pay and furloughing staff, in contrast to the layoffs that were prevalent in 2009.
Above the Law, Law.com and Law360 have published several stories on law firms that took temporary steps in the last week to cut expenses. They are:
• Norton Rose Fulbright, which has made “discrete reductions” in its work force and cut compensation for lawyers and staff members. The firm didn’t disclose the details, but tipsters told Above the Law that pay was reduced by 15%, except for those making under $50,000. (Above the Law)
• Dentons, which is cutting partner draws by at least 20%, and reducing pay for lawyers and staff members by up to 20%. Those making less than $60,000 won’t see a pay cut, while those making more than $190,000 will see the largest percentage reduction. Forty-one business services staff members will be furloughed. The partnership has established a fund to help employees and their families who have experienced financial hardships as a result of the COVID-19 pandemic. The firm made an initial contribution of $250,000. (Above the Law, Law.com, the Dentons memo)
• K&L Gates, which is reducing partner advances by 20% and cutting pay by 15% for other lawyers and staff members. Salaries won’t be reduced less than a $75,000 floor, with some regional variations. Scheduled advances will be reduced by more than 20% for law firm leaders. (Above the Law, the K&L Gates memo)
• Seyfarth Shaw, which is furloughing 10% of its U.S. employees, including both staff members and attorneys. The firm also cut draws by 20% for equity partners, pay by 10% for other lawyers, and pay by up to 10% for most staff members. Those making less than $60,000 aren’t affected. (Above the Law, Law.com, Law360, the Seyfarth memo)
• Foley Hoag, which cut pay by 15% for associates and counsels, compensation by 20% to 30% for nonequity partners, and pay by up to 15% for other staff members. The firm did not disclose the amount of compensation cuts by equity partners but said the financial burden will be “even greater.” (Above the Law, Law360, the Foley Hoag memo)
• Snell & Wilmer, which is furloughing some staff members, reducing partner draws by 10%, cutting pay of other lawyers by 10%, and cutting staff member pay from 1% to 10%. The firm will cover health, life, and long-term disability insurance premiums for furloughed employees. (Above the Law, Law360)
• Stoel Rives, which is reducing partner distributions by 20%, cutting pay by 20% for other attorneys, and cutting pay by 5% to 20% for staff members. The firm is also furloughing 10% of its staff members but will continue their benefits. (Above the Law, the Stoel Rives memo)
• Fox Rothschild, which is cutting salaries by 10% to 15% for those making more than $100,000. Pay won’t be cut to less than $100,000 for anyone. Equity partners are reducing monthly draws in tiers between 10% and 20%. (Above the Law, Law360)
• Quarles & Brady, which says it has “adjusted” partner distributions and draws, as well as compensation for other lawyers and staff. The firm has also furloughed a small number of employees. Tipsters told Above the Law that pay will be cut by 5% to 10% for staff members, by 10% for associates and nonequity partners making less than $200,000, and by 15% for nonequity partners making more than $200,000. Equity partners are reportedly taking a 30% cut in their quarterly draw and a 20% cut in biweekly draws. (Above the Law, Law360)
• Taft Stettinius & Hollister, which has cut lawyer head count by 1.4% and staff head count by 3.5%. Partner draws have been cut by 25%. (Above the Law, the Cincinnati Business Courier)
• Frost Brown Todd, which has furloughed a small percentage of its employees, whose health benefits are being paid by the firm. The firm has also deferred some compensation for equity partners. (Cincinnati Business Journal)
• Thompson Hine, which is reducing quarterly partner draws by 15% and cutting staff compensation by 1.7%. (Cincinnati Business Journal)
• Ogletree Deakins, which is taking additional steps after previously reducing the pay of some employees and furloughing others. The firm is reducing compensation by 20% for equity partners, by 15% for other lawyers, and by 10% for staff members earning at least $100,000. (Above the Law, Law.com)
• McDermott Will & Emery, which has laid off and furloughed some people, primarily professional staff members. Associates, income partners and capital partners are not affected, the firm told Law360. The firm did not provide numbers or percentages. (Law360)
• Husch Blackwell, which has previously cut equity partner draws and cut salaries for top executives. Now, the firm is instituting layoffs, furloughs, salary cuts, transitions to part-time work, early retirements and deferrals. Fewer than 10% of lawyers and staff members are affected. (Above the Law, the Husch Blackwell media alert)
