Nonpartner track jerb? Damn

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Rock-N-Roll
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Re: Nonpartner track jerb? Damn

Postby Rock-N-Roll » Thu May 26, 2011 7:24 pm

bdubs wrote:
Rock-N-Roll wrote:
bdubs wrote:They don't bill at the same rates, the entire point is to provide a source of cheap labor for tasks that don't require a great deal of sophistication.


Absolutely a good point, but hopefully you'll grant me that it need not remain that way.

In general, I know I'm being totally alarmist, but I look at this current system and I wonder what are the pressures that drive partners to keep paying new associates $160,000/yr when there is information out there that claims that these firms are not earning as much as they were before and clients are now bucking hard to lower billing rates?


The rates are all relative, having expensive resources means that partners get to justify even higher rates for themselves.

Remember that this market is one where you are paying for prestige, not necessarily for services rendered. Most clients have no idea how to gauge the quality of the legal representation that they get, so they seek out the firm with THE REPUTATION that meets their perceived level of need. Dropping associate salaries would tarnish that reputation and ability to bill at exorbitant rates.

You can actually thank the salary transparency of most law firms for this, other industries have much more closely guarded pay practices.


Definitely. What you're saying is what I took from the article too. Law firms have to continue to offer this salary level to attract associates from prestigious schools.

But what happens if graduates from prestigious schools start taking these new non-partner track low paying jobs? Graduates of prestigious schools might be tempted to do this if they are unable to find a partner track job or they might even do so from the get-go if they are attracted to the slower pace of the non-partner track jobs.

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Rock-N-Roll
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Re: Nonpartner track jerb? Damn

Postby Rock-N-Roll » Thu May 26, 2011 7:27 pm

Desert Fox wrote:
It's hard to justify 200 dollars an hour billed if you are only paying that associate 50K a year.


Why would clients care how much the associates make? Client rates are mainly based on the prestige of the firm and partners (as far as I understand it).

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Rock-N-Roll
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Re: Nonpartner track jerb? Damn

Postby Rock-N-Roll » Thu May 26, 2011 7:34 pm

laborday wrote:The problem is that every medical resident will become a physician. In the nonpartner track system that you proposed, most of the non-partner track associates will not become a partner. The difference is that there is a lack of medical school grads, but too many law school grads.


Let me make clear that I am not a proponent of this system. I am worried that such a system could arise!

I agree with you 100% that doctors did a good job of controlling the number of medical graduates per year in order to maintain a favorable level of demand for new graduates, while the ABA has allowed the market to saturate.

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bgdddymtty
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Re: Nonpartner track jerb? Damn

Postby bgdddymtty » Thu May 26, 2011 7:49 pm

Rock-N-Roll wrote:
laborday wrote:The problem is that every medical resident will become a physician. In the nonpartner track system that you proposed, most of the non-partner track associates will not become a partner. The difference is that there is a lack of medical school grads, but too many law school grads.


Let me make clear that I am not a proponent of this system. I am worried that such a system could arise!

I agree with you 100% that doctors did a good job of controlling the number of medical graduates per year in order to maintain a favorable level of demand for new graduates, while the ABA has allowed is legally required to allow the market to saturate.

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Rock-N-Roll
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Re: Nonpartner track jerb? Damn

Postby Rock-N-Roll » Thu May 26, 2011 8:18 pm

bgdddymtty wrote: while the ABA has allowed is legally required to allow the market to saturate.


Legally? Under what law? I thought the legal profession self-regulated its own practices in a way similar to the way that physicians self-regulate themselves.

Renzo
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Re: Nonpartner track jerb? Damn

Postby Renzo » Thu May 26, 2011 8:51 pm

Rock-N-Roll wrote:
bgdddymtty wrote: while the ABA has allowed is legally required to allow the market to saturate.


Legally? Under what law? I thought the legal profession self-regulated its own practices in a way similar to the way that physicians self-regulate themselves.

Under antitrust law. States generally allow self-regulation, but that's not the same as allowing anticompetitive cartels.

timbs4339
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Re: Nonpartner track jerb? Damn

Postby timbs4339 » Thu May 26, 2011 9:23 pm

The idea of partner track vs. non-partner track hides the very low possibility that a partner track associate will actually become partner. What partner track really means is the 160K pay scale. It's strange to call an associate on the partner track when it is built into the firm's recruitment and training system to push them out after 3, 6, or 8 years. Of course, this was fine when clients could and would pay, so firms could run leverage of 9:1 in some practice groups. Now that clients are not willing to pay for junior level work and firms are not willing to make most of them partner, it seems obvious that the firms would simply lower class sizes without dropping pay and convert more and more of the junior work, research, writing, doc review, due diligence, to cheaper employees located outside the major metro areas. This would have to happen quietly, of course, because firms are so concerned with maintaining a certain kind of image which is why they don't often experiment with new training and recruitment programs (someone said Veblen good above which is an interesting thought).

If this catches on and becomes a common thing (could you imagine 'company towns' full of these career associates in former manufacturing or mill cities?), it will be a really interesting time for the profession. The problem with these jobs is that they don't teach so much of the craft of lawyering, how to get and retain clients, grow a practice, carve out a niche, negotiate with opposing counsel, run a case or a deal. They may not ever come into contact with clients or opposing counsel. Lawyering is supposed to be more than just a 9-5 white collar office job (or 9-midnight office job for you Biglaw folks). That might be fine for many graduates who went to law school without a clearly defined sense of what most lawyers actually do and would have ended up working office jobs anyway. But it might not be good for the profession as a whole for many of its new graduates to move so far away from the central idea of what a lawyer does.

DAJ_Summer
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Re: Nonpartner track jerb? Damn

Postby DAJ_Summer » Thu May 26, 2011 9:24 pm

Rock-N-Roll wrote:
bdubs wrote:They don't bill at the same rates, the entire point is to provide a source of cheap labor for tasks that don't require a great deal of sophistication.


Absolutely a good point, but hopefully you'll grant me that it need not remain that way.

In general, I know I'm being totally alarmist, but I look at this current system and I wonder what are the pressures that drive partners to keep paying new associates $160,000/yr when there is information out there that claims that these firms are not earning as much as they were before and clients are now bucking hard to lower billing rates?


The fact that you're just beginning to learn about the industry is making your analysis a bit myopic. Working at a big law firm is one of the worst fucking jobs on the planet until you shower an associate in richess. Not 3 years ago firms were locked in mortal combat to retain associates. Firms need associates to take on work: a partner cannot advise on a merger, litigate a securities claim, lobby the FDA, or draft documents for a round of seed funding if he has neither time nor competent, licensed, and available attorneys to do it. So firms were jacking up salaries and benefits because they were losing money when they couldn't keep enough bodies around to handle work.

Yes, in hard times clients pushed back on bills. yes, in and outsourcing are factors. But the blip (albiet the big blip) of the down turn has not reversed the fundamentals of the industry, which requires enormous dedication from people with 7+ years of higher education, a law license, competence, and an unhuman pain tolerance.

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Noval
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Re: Nonpartner track jerb? Damn

Postby Noval » Fri May 27, 2011 9:54 pm

So basically,

1)If these jobs are in secondary markets where COL is relatively low, they are definitely not a "bad" idea, considering you have "low" debts.
2)They will probably slow down outsourcing indirectly, so students from TTTs will at least something to dig on other than starbucks.
3)But if you come from a Top school with Top debts, it's basically full-paid Biglaw or gtfo, or some prestigious PI with good
loan repayment benefits.

Lastly, since more and more nationally known Law Firms are moving into this system, some people will pick these jobs to lateral into other fields since as Finance, Consulting, other Business careers.

+ Working hours are said to be lower at these jobs, therefore don't get mad if you see the low salaries...

160k ---> Big Salary ---> Big Expectations ---> 60 to 90 hours a week ---> Still slim chances to make Partner but good exit options.
55-60k ---> Low Salary ---> Lower expectations ---> 45-60 hours a week ---> No chances to make Partner but same exit options.


Personnally, in this economy, i wouldn't turn down a non-partner track position if i had close to no debts and no other options, if the firm is big, it's alumni base must be big as well, and i'd use it to find better jobs in either other Law Firms or in Business.

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thelawyler
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Re: Nonpartner track jerb? Damn

Postby thelawyler » Fri May 27, 2011 10:36 pm

Unless the exit options are not the same due to much lower prestige and "training" because of the work you did.

Renzo
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Re: Nonpartner track jerb? Damn

Postby Renzo » Fri May 27, 2011 10:41 pm

Noval wrote:
160k ---> Big Salary ---> Big Expectations ---> 60 to 90 hours a week ---> Still slim chances to make Partner but good exit options.
55-60k ---> Low Salary ---> Lower expectations ---> 45-60 hours a week ---> No chances to make Partner but same exit options.


This is where your analysis falls apart. The "exit options" from these firms are a product of A) the inherent prestige of the job/firm and B) the opportunity to make contacts at banks/hedge funds/corporations/VC firms/etc. that might net you a job down the road. Neither of these are present for someone in a back-office doc review warehouse.

I'm not saying they are bad jobs, but don't delude yourself that Deutsche Bank is tripping over itself to hire these folks.

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gwuorbust
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Re: Nonpartner track jerb? Damn

Postby gwuorbust » Sat May 28, 2011 1:33 pm

Renzo wrote:
Noval wrote:
160k ---> Big Salary ---> Big Expectations ---> 60 to 90 hours a week ---> Still slim chances to make Partner but good exit options.
55-60k ---> Low Salary ---> Lower expectations ---> 45-60 hours a week ---> No chances to make Partner but same exit options.


This is where your analysis falls apart. The "exit options" from these firms are a product of A) the inherent prestige of the job/firm and B) the opportunity to make contacts at banks/hedge funds/corporations/VC firms/etc. that might net you a job down the road. Neither of these are present for someone in a back-office doc review warehouse.

I'm not saying they are bad jobs, but don't delude yourself that Deutsche Bank is tripping over itself to hire these folks.


yeah these jobs ARE these people's exit option. Most seem to be laid off BigLaw associates who didn't end up somewhere else or past temps or doc reviewers. They are throughly different from BigLaw jobs. There are many potential upsides to them, but great exit options is not one of them.

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danquayle
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Re: Nonpartner track jerb? Damn

Postby danquayle » Sat May 28, 2011 8:04 pm

timbs4339 wrote:The idea of partner track vs. non-partner track hides the very low possibility that a partner track associate will actually become partner. What partner track really means is the 160K pay scale. It's strange to call an associate on the partner track when it is built into the firm's recruitment and training system to push them out after 3, 6, or 8 years. Of course, this was fine when clients could and would pay, so firms could run leverage of 9:1 in some practice groups. Now that clients are not willing to pay for junior level work and firms are not willing to make most of them partner, it seems obvious that the firms would simply lower class sizes without dropping pay and convert more and more of the junior work, research, writing, doc review, due diligence, to cheaper employees located outside the major metro areas. This would have to happen quietly, of course, because firms are so concerned with maintaining a certain kind of image which is why they don't often experiment with new training and recruitment programs (someone said Veblen good above which is an interesting thought).

If this catches on and becomes a common thing (could you imagine 'company towns' full of these career associates in former manufacturing or mill cities?), it will be a really interesting time for the profession. The problem with these jobs is that they don't teach so much of the craft of lawyering, how to get and retain clients, grow a practice, carve out a niche, negotiate with opposing counsel, run a case or a deal. They may not ever come into contact with clients or opposing counsel. Lawyering is supposed to be more than just a 9-5 white collar office job (or 9-midnight office job for you Biglaw folks). That might be fine for many graduates who went to law school without a clearly defined sense of what most lawyers actually do and would have ended up working office jobs anyway. But it might not be good for the profession as a whole for many of its new graduates to move so far away from the central idea of what a lawyer does.


prestige is all about exclusivity. Very expensive things are by their nature exclusive. So I don't think it's a stretch to say that prestige goods are quite often Veblen goods. Law firms hire the elite grades not necessarily because they are the best, but because it demonstrates that they, the law firm, are the best.

There's always going to be a legal market for the "best", because often hiring legal counsel is really just about brandishing a sword to wield in negotiations. I work for in-house for a company, and the first thing we find out prior to negotiation is what firm, if any, the other company has hired. If its a "name" firm, we certainly adjust our negotiation tactics.

Same thing for litigation I'd imagine: if you go out and hire Skadden, you're telling the other side to a dispute "Better settle now, because we're prepared to spend the money to see this through, are you?"




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