Will Cravath’s Bigger Bonuses Be Big Enough To Make Associates Stay Put? – () – Cravath, Swaine & Moore said Monday it will pay its associates a bonus of between $15,000 and $115,000 next month, on top of pay increases for lawyers at major U.S. law firms.
The announcement is the first from a leading company to detail this year’s year-end bonus and sets a new, high bar that the company will be under pressure to meet or exceed. A Cravath spokesman declined to comment. The move was announced in an internal memo and first reported by Legal Blog.
Will Cravath’s Bigger Bonuses Be Big Enough To Make Associates Stay Put?
The Wall Street firm will distribute the bonus on Dec. 17, and those involved must be “at the firm” that day, according to the memo.
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Law firms have offered bonuses on several occasions since the start of the pandemic to reward colleagues for their efforts during the crisis and encourage them to stay away from working on corporate business and other matters.
Cravath is one of dozens of companies that offer two “special” bonuses in the spring and fall to their oldest employees, ranging from $6,000 to $32,000. He also joined a wave of companies raising associate pay this summer, raising first-year pay from $190,000 to $205,000.
This month’s report from the Thomson Peer Monitor Index, which tracks the financial performance of large and mid-sized law firms, found that direct costs rose more than 7% over the past year, driven largely by associate salaries and bonuses.
According to Monday’s memo, the company will award $15,000 in bonuses to the class of 2021; $20,000 for the Class of 2020; $30,000 for the class of 2019; $57,500 for the Class of 2018; $75,000 for the class of 2017; $90,000 for the class of 2016; $105,000 for the class of 2015; and $115,000 for the class of 2014.
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Xiumei Dong covers legal industry news with a focus on law firm strategy, growth, in-house counsel and the Washington, DC legal market. Contact him at [email protected]. Annual bonuses used to be great for retention, but now splitting them into quarterly bonuses makes it harder for members to leave.
Companies ask themselves: “How to keep our partners?” concludes that How do we get them back to the office? There are still a large number of people, majority or minority, who are not enthusiastic about entering office.
– Josh Holt, founder of Biglaw Investor, explains the year-end bonus schedule announced by Cravath earlier this week, and expected to be followed by other Biglaw firms.
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Stasi Zaretsky is the editor-in-chief of “On the Law” magazine, where she has worked since 2011. She would love to hear your thoughts, so please email her with any tips, questions, comments or criticisms. You can follow him on Twitter or connect with him on LinkedIn.
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Hot Take: Cravath Is Irrelevant And Overrated
We surveyed more than 1,100 attorneys about compensation, bonuses, average salary and more. Read the results. () – Cravath Swain & Moore, which announced a holiday bonus last month, was the first to size up the market for large U.S. law firms and said on Tuesday that year-end payouts would be combined with “one-time” . “bonus. more than the equivalent amounts announced this week by rivals Davis Polk & Wardwell.
Other Cravath competitors, Debevoise & Plimpton; Milbank; Paul Hastings; Paul, Weiss, Rifkind, Wharton, Garrison; Skadden, Arps, Slate, Meagher & Flom and Willkie Farr & Gallagher also decided to follow Davis Polk’s schedule of special and year-end bonuses, giving $138,000 to their senior partners.
Fried Frank also said in an internal memo on Tuesday that it will match a common scale for counterparties that meet credit requirements for settlement in New York, Washington and London, and pay incentive fees to those who meet certain criteria.
In an internal memo about the latest promotion, Cravath management said the company will not use “billable hours or similar criteria” to qualify associates. A special bonus will be delivered on December 17th with the year-end bonus.
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Like many others, Cravath has already offered two “special” bonuses in the spring and fall to reward associates who work hard and discourage them from leaving during times of high demand for legal work.
Combined, the firm’s senior partners could earn up to $202,000 in cash this year, in addition to their salaries. Many US law firms, including Cravath, raised associate salaries earlier this year.
Katten Muchin, who aligned with Cravath’s year-end bonus schedule, said Tuesday that Rosenman offers additional “discretionary” bonuses to associates who work 2,000 hours or more. Bonuses increase for every additional 100 hours, with up to 2,400 billers earning between $31,000 and $172,500.
Xiumei Dong covers legal industry news with a focus on law firm strategy, growth, in-house counsel and the Washington, DC legal market. Contact him at [email protected]. At the start of the 2021 bonus season on Monday, November 22nd, a new schedule of $15,000 to $115,000 was announced (a 15% increase from what has been used since 2014). Right now, the Cravath promotion isn’t coming to a handful of games, and it’s been over a week since it was announced.
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The partners are starting to get a little nervous. What’s going on here? Apparently, Cravath has already made his mark. What could be the expectation? Where are all the bonuses?
We surveyed more than 1,100 attorneys about compensation, bonuses, average salary and more. Read about the results.
Are other firms that haven’t announced their bonus rates waiting to announce higher and better bonus rates than a certain law firm, says Davis Polk? Does this lead to bond defaults?
If that’s the case (and we’re pretty sure it is), why not post a bonus on Cravath’s current ranking?
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, then corresponds to the new scale? These Biglaw firms know full well that if Davis Polk actually increased the Cravath bonus amount by one, they would match whatever Davis Polk issues.
Why wait for your great colleagues? Boohoo, you’ll have to write another bonus note with another match. you can We believe in you!
Take this show on the road for your lawyers of record who appreciate your feet during the pandemic. Claim your bonus.
BigHand’s latest survey of more than 800 legal professionals demonstrates the industry’s commitment to investing in people and technology to manage resources, highlighting the importance of effective talent…
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For Davis Polk, the entire Biglaw market is waiting for the firm to make a move. Right now partners know what the bottom of the bond market looks like in 2021. Will DPW give more money to lawyers at this unprecedented time with special bonuses? I guess we’ll just have to wait and see.
Stasi Zaretsky is the editor-in-chief of “On the Law” magazine, where she has worked since 2011. She would love to hear your thoughts, so please email her with any tips, questions, comments or criticisms. You can follow him on Twitter or connect with him on LinkedIn.
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