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How Does a V50 Firm Drop Lock-Step Compensation...
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Date: July 1st, 2009 4:21 PM Author: burgundy property clown Subject: ...and no one seems to notice on XOXO? http://abovethelaw.com/2009/07/orrick_ends_lockstep.php?show=comments#comments
This is big news, folks. It appears that client pressures, among other things, will eventually give way to the death of lockstep comp.
Orrick, while not a V10 firm or market leader, is pretty well respected in Biglaw. If they can succeed under their new 3-tiered associate model, expect the rest of Biglaw to follow suit. |
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Date: July 1st, 2009 4:22 PM Author: Ungodly fluffy death wish hospital BIGLAW to $100K in 6 months. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134125) |
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Date: July 1st, 2009 4:28 PM Author: Carmine factory reset button rehab "expect the rest of Biglaw to follow suit."
why would other biglaw firms change their model to follow a mediocre firm? |
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Date: July 1st, 2009 5:00 PM Author: burgundy property clown "why would other biglaw firms change their model to follow a mediocre firm?"
A tiered system such as the one proposed by Orrick:
(1) Saves the partners $$$ since they can pay associates less.
(2) Encourages, if not motivates associates to give 110% effort every day at the office so that they can vy for "top-tier" status.
(3) Gives partners an excuse not to elevate associates to partnership.
(4) Avoids the hassel of having to fight frivolous lawsuits filed by associates who think they were entitled to a partnership position.
From the partners' perspective, this system is win-win. From the associates perspective, it's lose-lose.
The in-fighting and competition between and among Orrick associates in the coming years is likely to get pretty ugly under this system. But the partners will be laughing all the way to the bank.
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Date: July 1st, 2009 5:01 PM Author: Ungodly fluffy death wish hospital How hard is it to get off the "fuck you track" once you're on it? (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134566) |
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Date: July 1st, 2009 5:14 PM Author: Violent Site Old Irish Cottage Almost impossible.
These tracks exist already. It's just for the first few years, everyone gets paid the same - which is probably for the best. |
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Date: July 2nd, 2009 11:55 AM Author: House-broken station Partners don't worry about keeping people out of the partnership. Even for the best associates, making partners is like playing Russian roulette. You watch and see how few are made this year.
Personally, I think this is great. Ending lockstep would probably have given me a pay bump over the last few years. |
Date: July 1st, 2009 4:31 PM Author: Mustard hunting ground ohnoes! biglaw to compensate like every other industry!!! (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134225) |
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Date: July 1st, 2009 4:54 PM Author: Ungodly fluffy death wish hospital It will be funny to see how out of control the nepotism gets. Influential hiring partner's son for TTT only billed 1300 hours, but uhhhh did really good work so give him 250K. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134474) |
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Date: July 2nd, 2009 12:14 PM Author: Glittery space every firm has a few deadwood relatives who never would have been hired as associates; but they don't get made partner (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141186) |
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Date: July 14th, 2009 6:14 PM Author: galvanic balding knife many firms have nepotism policies that forbid children of partner's from being employed at all even now. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12244170) |
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Date: July 1st, 2009 4:59 PM Author: walnut irradiated base this isn't really news because other Vault firms moving away from it and to 100K for first years over the past few weeks have lessened the blow of this news. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134533) |
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Date: July 1st, 2009 5:00 PM Author: Ungodly fluffy death wish hospital I predicted this. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134560) |
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Date: July 2nd, 2009 8:13 AM Author: Scarlet razzmatazz immigrant You predicted a lot of things. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12140260) |
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Date: July 1st, 2009 5:01 PM Author: burgundy property clown 1. There's a huge difference between cutting salaries 10% (or more) and dropping the lockstep system entirely.
2. No firm of Orrick's calibre (V50) has proposed such a dramatic change to the traditional compensation model. |
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Date: July 1st, 2009 5:03 PM Author: walnut irradiated base r u Orrick trolling or something? Orrick is nothing special. Howrey did this like a week ago. they are peer firms. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134588) |
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Date: July 1st, 2009 5:10 PM Author: burgundy property clown 1. Howrey is ranked #79 in Vault. Orrick is ranked #37.
2. Howrey's "Associate Development Program" differs logistically and conceptually from, and would not be as cost-effective as compared to what Orrick is proposing. |
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Date: July 1st, 2009 5:13 PM Author: Motley canary blood rage corner Ridiculous distinction. Finnegan is also ranked lower. Would you actually argue that Orrick is a better firm than Finnegan? (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134695) |
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Date: July 1st, 2009 5:19 PM Author: burgundy property clown I can't speak to the merits of any firms vis a vis any others. All I'm saying is that Orrick's decision to drop lockstep compensation is not some non-story. I doubt 2-3 years from now Orrick and its new compensation system will be some random outlier. In fact, it wouldnt suprise me at all if Orrick's model became the standard. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134756) |
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Date: July 2nd, 2009 7:31 AM Author: Charismatic Cheese-eating Parlor Becky you said: "No firm of Orrick's calibre (V50) has proposed such a dramatic change to the traditional compensation model."
now you say: "I can't speak to the merits of any firms vis a vis any others."
r u stupid |
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Date: July 2nd, 2009 12:36 PM Author: burgundy property clown I, personally, am not qualified to speak to the merits of law firms vis a vis others. I leave that to Vault and other publications to do. According to Vault, Orrick's "calibre" is a Top 50 firm.
Apparently I'm so stupid that it took less than 24 hours for another firm to follow Orrick's lead and drop lockstep (note: the same firm that Latham followed when it froze salaries).
http://abovethelaw.com/2009/07/squire_sanders_lockstep_end.php#more
I bet several top firms have already been planning for this day to come and likely have several different compensation models in mind. Now that the dominoes are beginning to fall, it's only a matter of time... |
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Date: July 1st, 2009 5:04 PM Author: Soul-stirring Sienna Hissy Fit "V50" is an utterly meaningless distinction. There are the V10 + a few other firms - latham, then there is the rest of the V100.
Putting some demarcation at V50 is like talking about T24 law schools. |
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Date: July 1st, 2009 5:16 PM Author: burgundy property clown Firms ranked between 11-36 will see what Orrick is doing, and if they can find a way to profit from it, may implement the system, or some variation of it. Firms ranked between 1-10 see what firms 11-36 are doing, and so on...
No one expected a V10 firm like Latham to freeze salaries after lowly Squire Sanders froze salaries...but it happened.
If firms can effectuate massive cost savings that simultaneously be justified to clients and the public under the guise of "fairness" to all, what firm manager wouldnt jump at the chance to do it? |
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Date: July 2nd, 2009 11:57 AM Author: Heady impressive organic girlfriend u have the trickle down philosophy backwards there kid. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141066) |
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Date: July 2nd, 2009 12:31 PM Author: burgundy property clown Trickle-down has rarely been the philosophy of Biglaw. Brobeck was the first firm to raise salaries to $125,000 back in '99-'00, but everyone upstream followed suit. In Biglaw, compensation trends are all about what makes the most sense to the firm. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141314) |
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Date: July 2nd, 2009 11:38 AM Author: Metal 180 resort wrinkle Yeah cuz A&P and Jenner are no better than Nixon Peabody (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12140951) |
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Date: July 1st, 2009 5:05 PM Author: Motley canary blood rage corner ITT: disgusting Orrick trolling. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134616) |
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Date: July 1st, 2009 5:17 PM Author: slimy buck-toothed famous landscape painting LOL. The true elite firms will not follow. Enjoy eating what you kill. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12134731) |
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Date: July 2nd, 2009 11:41 AM Author: Transparent bat shit crazy marketing idea deer antler What people are forgetting is that in this market firms can do whatever they want. But when (if?) the economy picks up and recruiting becomes an issue again they'll go right back to lockstep because lawyers will take a less prestigious firm with lockstep over a firm with the Orrick model. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12140970) |
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Date: July 2nd, 2009 11:44 AM Author: Anal People Who Are Hurt Goyim i don't see recruiting being an issue for at least 3-4 years. there's so much excess/froth in the supply of lawyers out there it'll take time for them to be absorbed back in. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12140981) |
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Date: July 2nd, 2009 11:57 AM Author: Transparent bat shit crazy marketing idea deer antler Agreed, but it'll still revert back, it'll just take longer. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141064) |
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Date: July 2nd, 2009 12:07 PM Author: Ungodly fluffy death wish hospital Going to this TTT model makes Orrick inherently TTT and inferior to a firm that pays market. And law students will not trust this shit firm even if they go back to normal since they will switch back the second things go wrong. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141137) |
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Date: July 2nd, 2009 12:09 PM Author: House-broken station I would have gone to a firm like this because I would have believed that I would have been one of the better associates.
Also, a small paycut isn't so terrible. It lets you know that the firm doesn't value you, so you can start looking to jump ship sooner. |
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Date: July 2nd, 2009 12:11 PM Author: Ungodly fluffy death wish hospital LOL, myth. You're kidding yourself if you think the higher pay grades aren't political or nepotism picks. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141158) |
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Date: July 2nd, 2009 12:19 PM Author: House-broken station Depends on the firm and the partner. For a partner who got his clients through politics/nepotism/personality/had them luckily handed to them, then yeah, they would do the same thing. But not all partners measure that way. What's more, a firm would be more likely to pay its best associates more because they might take off for another firm willing to pay more than lockstep.
But the real tragedy--the one completely ignored by this board--is how little associates saw of the gains in BIGLAW of the past few years. Partners saw their revenues and PPP increase drastically. |
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Date: July 2nd, 2009 12:20 PM Author: Ungodly fluffy death wish hospital How common is it for associates to jump to higher ranked firms? (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141229) |
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Date: July 2nd, 2009 12:22 PM Author: House-broken station In good times, not uncommon at all. I know a bunch who went from V60s-V80s to V10. (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141244) |
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Date: July 2nd, 2009 1:20 PM Author: Glittery space it happens all the time; still, moving down is far more common (http://www.autoadmit.com/thread.php?thread_id=1031536&forum_id=2#12141697) |
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Date: July 14th, 2009 4:49 PM Author: burgundy property clown Another V50 firm (Morgan Lewis) drops lockstep:
http://abovethelaw.com/2009/07/morgan_lewis_cancels_2010_summ.php#more |