Partner Pay Cuts are New Signpost in Dismal Law Firm Economic Landscape
Associates and staff were low-hanging fruit waiting to be cut in law firm layoffs. Start dates for new attorneys have been delayed, salaries have been frozen and benefits formerly taken for granted have been axed. At least one well-known law firm has even reduced the coffee service offered at its Chicago headquarters.
But now BigLaw partnerships seeking to stabilize their finances amidst a global economic free fall are getting down to the nitty-gritty. A growing number of major firms are reducing partner pay, Bloomberg reports.
Cuts in partner compensation have recently been announced at Allen & Overy, Dewey & LeBoeuf and DLA Piper, and could well be quietly under way at other major international firms, too, according to the news agency.
“It’s hard to get rid of a partner, so cutting pay is a simple way of sending a message that maybe people ought to think about moving toward the door,” says attorney Bruce MacEwen, a New York City-based legal consultant.
Partners at a number of top London-based international law firms have been warned to expect their compensation to drop as much as one-third this year, compared to 2008, the Evening Standard reported in January.
Related coverage:
ABAJournal.com: “Dewey Cuts 66 Partners’ Pay—By As Much as 80 Percent”
ABAJournal.com: “DLA Piper Will Cut Pay for Most Partners by 11.5 Percent”
ABAJournal.com: “McDermott Coffee Cutback Sends ‘Message of Desperation,’ Partner Says”
ABAJournal.com: “Partner Ousters Double or Triple the Pace of Two Years Ago, Consultant Says”
