Would you be disappointed in this situation?

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wilc0phan
Posts: 23
Joined: Sat Jan 28, 2012 4:16 pm

Would you be disappointed in this situation?

Postby wilc0phan » Mon Jan 08, 2018 12:44 pm

I'll try and make a very long story as short as possible...

I spent my initial 3.5 years of practicing in the real estate finance/capital markets group at a large mid-sized firm in a major market. My compensation was under market (as a 3rd year, I was making $155k with approx. $25k in bonus). I excelled in all 3 years at the firm and can confidently say I was very well-liked. Recently, I decided to relocate to a secondary market with my wife where I landed a really great position at an AM100 firm, and where I am thus far, very happy.

At my old job in the major market, I spent about 25-35% of my overall hours working for a notoriously disliked partner in the firm who seemingly had a very checkered history with the firm, from what I can tell... to say the least, it was a very unique situation for me -- it was very odd for the major partners in a firm, including the managing partner (who had always been very "buddy-buddy" with me) to go to the associate behind the back of a partner to get the real details of a matter; the partners had routinely noted that I was doing everyone a favor my handling the "Partner X matters", and that "everyone knows Partner X is a joke". Essentially, Partner X had 1 client who hadn't paid a legal bill in years...this client owed our firm over $6MM in outstanding legal fees as of 12/17.

Now, for purposes of this post I won't go into any detail contemplating the obvious question of how/why the firm arrived at this situation in the first place. The story/question is this: I had worked on a particular transaction for this client (sale of large asset owned by client) for over 2 years -- securing a very complicated set of federal, state and local regulatory approvals that needed to be obtained to clear title and ultimately sell the asset. All along, the client had told our firm that upon the sale of this asset, our firm would be paid in full all of our outstanding legal fees...

After a 2 year effort, I secured the final approvals the day before I left the firm and relocated (kind of crazy). At this point, all that was needed to be done was a very simple, straightforward real estate closing (crossing T's and dotting I's), most of the work of which was already done by me.

All of my efforts on this project had been routinely noted by various partners in the firm (e.g., "I hear this thing is finally going to close...", "I hear we are getting paid..." etc. etc.), including after I had already given my notice to the firm that I was moving on and relocating. Before I left I received a very, very humbling set of thanks from the partners of the firm and was told that "I am welcome back absolutely whenever"... this was a nice feeling. Better than this from my perspective (I was ready to move on), was that the managing partner of the firm, on two occasions came into my office, closed the doors and told me that that if, in fact, this transaction closed, and our fees were in fact wired and on the books in 2017, that I would "be taken care of for all of my work"...

Essentially, while I was relocating across the country to start another job, I closed this deal on phone with the assistance of a paralegal at the firm I was close with...this ultimately has resulted in a net $6.1MM being recouped on the firm's books for 2017 -- needless to say, they were very happy. The managing partner called me the day after Christmas on my cell phone and said a FedEx was in the mail to me this week with the promised enclosures "taking care of me"...
...

Now, before many of you say "why didn't I just stick it out before I lateralled to get my full bonus..." the answer is I simply couldn't from a logistical standpoint (I also received a great signing/relocation bonus at the new firm which helped alleviate this consideration). One last preface is that I realize that my old firm here technically owes me nothing since I am now a former employee. I recognize this. Having said this, $6,100,000 is not your ordinary transactional fee for a deal, so I have to admit, I was disappointed to see that the check in the package was only for:

$10k. "for great service rendered to clients in 2017".

I don't want to be, but I have to say this was disappointing... here's my reason: the 3 annual reviews I received at this firm were glowingly positive, with not so much as constructive feedback... it was truly all good. Literally, the only thing that was ever noted to me in these reviews (where I ultimately was told what my bonus was based on the year) was that my realization rate (%) was slightly lower than the two highest associates at the firm...but, the partners expressly acknowledged my realization rates were down only because of all of the work I did for "Partner X" (who had the client that wasn't paying until recently).

Having said all of this, would you all be disappointed in this situation? My past 3 years' annual bonuses would have been a bit higher had these amounts been realized during those years...$6MM in straight fees is a very large windfall for the firm....... so 10k seems like -- let's be honest -- a bit of a jack-off figure.

OR, am I totally overanalyzing this situation, and should take the money and just be thankful that anything was sent at all?

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LaLiLuLeLo
Posts: 594
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Re: Would you be disappointed in this situation?

Postby LaLiLuLeLo » Mon Jan 08, 2018 1:05 pm

Is there an expectation at your firm that bonuses are based on billing realization? There are tons of associates out there, let’s assume in biglaw, who run deals that are worth way more than $6m to the firm yet see the same lockstep bonus as everyone else. Unless your firm’s bonus structure is different, I see no reason why you are fixated on how much money the firm collected.

Also, as you note, you left before bonuses were paid. What else did you expect?

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Lincoln
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Re: Would you be disappointed in this situation?

Postby Lincoln » Mon Jan 08, 2018 1:18 pm

Wait. You got paid $10k as a bonus after you left the firm? I've literally never heard of that happening.

jhett
Posts: 200
Joined: Thu Mar 16, 2006 4:36 pm

Re: Would you be disappointed in this situation?

Postby jhett » Mon Jan 08, 2018 1:45 pm

Yes, your outcome is disappointing given all the work you put in on this matter, but... what can you do? Doubt you can go back and ask them for more. You left the firm, and they still paid you a bonus. It's not the windfall you expected, but it's something. You mentioned that you were underpaid at the old firm, so it's not surprising that your bonus may also be underwhelming. And you probably read too much into the managing partner's statements about taking care of you.

Lincoln wrote:Wait. You got paid $10k as a bonus after you left the firm? I've literally never heard of that happening.


That has happened to me as well. I didn't expect it, but the firm wanted to do right by me. Also, I moved in-house so probably they didn't want to burn any bridges.

sparty99
Posts: 1534
Joined: Sat Dec 11, 2010 8:41 pm

Re: Would you be disappointed in this situation?

Postby sparty99 » Mon Jan 08, 2018 2:43 pm

wilc0phan wrote:I'll try and make a very long story as short as possible...

I spent my initial 3.5 years of practicing in the real estate finance/capital markets group at a large mid-sized firm in a major market. My compensation was under market (as a 3rd year, I was making $155k with approx. $25k in bonus). I excelled in all 3 years at the firm and can confidently say I was very well-liked. Recently, I decided to relocate to a secondary market with my wife where I landed a really great position at an AM100 firm, and where I am thus far, very happy.

At my old job in the major market, I spent about 25-35% of my overall hours working for a notoriously disliked partner in the firm who seemingly had a very checkered history with the firm, from what I can tell... to say the least, it was a very unique situation for me -- it was very odd for the major partners in a firm, including the managing partner (who had always been very "buddy-buddy" with me) to go to the associate behind the back of a partner to get the real details of a matter; the partners had routinely noted that I was doing everyone a favor my handling the "Partner X matters", and that "everyone knows Partner X is a joke". Essentially, Partner X had 1 client who hadn't paid a legal bill in years...this client owed our firm over $6MM in outstanding legal fees as of 12/17.

Now, for purposes of this post I won't go into any detail contemplating the obvious question of how/why the firm arrived at this situation in the first place. The story/question is this: I had worked on a particular transaction for this client (sale of large asset owned by client) for over 2 years -- securing a very complicated set of federal, state and local regulatory approvals that needed to be obtained to clear title and ultimately sell the asset. All along, the client had told our firm that upon the sale of this asset, our firm would be paid in full all of our outstanding legal fees...

After a 2 year effort, I secured the final approvals the day before I left the firm and relocated (kind of crazy). At this point, all that was needed to be done was a very simple, straightforward real estate closing (crossing T's and dotting I's), most of the work of which was already done by me.

All of my efforts on this project had been routinely noted by various partners in the firm (e.g., "I hear this thing is finally going to close...", "I hear we are getting paid..." etc. etc.), including after I had already given my notice to the firm that I was moving on and relocating. Before I left I received a very, very humbling set of thanks from the partners of the firm and was told that "I am welcome back absolutely whenever"... this was a nice feeling. Better than this from my perspective (I was ready to move on), was that the managing partner of the firm, on two occasions came into my office, closed the doors and told me that that if, in fact, this transaction closed, and our fees were in fact wired and on the books in 2017, that I would "be taken care of for all of my work"...

Essentially, while I was relocating across the country to start another job, I closed this deal on phone with the assistance of a paralegal at the firm I was close with...this ultimately has resulted in a net $6.1MM being recouped on the firm's books for 2017 -- needless to say, they were very happy. The managing partner called me the day after Christmas on my cell phone and said a FedEx was in the mail to me this week with the promised enclosures "taking care of me"...
...

Now, before many of you say "why didn't I just stick it out before I lateralled to get my full bonus..." the answer is I simply couldn't from a logistical standpoint (I also received a great signing/relocation bonus at the new firm which helped alleviate this consideration). One last preface is that I realize that my old firm here technically owes me nothing since I am now a former employee. I recognize this. Having said this, $6,100,000 is not your ordinary transactional fee for a deal, so I have to admit, I was disappointed to see that the check in the package was only for:

$10k. "for great service rendered to clients in 2017".

I don't want to be, but I have to say this was disappointing... here's my reason: the 3 annual reviews I received at this firm were glowingly positive, with not so much as constructive feedback... it was truly all good. Literally, the only thing that was ever noted to me in these reviews (where I ultimately was told what my bonus was based on the year) was that my realization rate (%) was slightly lower than the two highest associates at the firm...but, the partners expressly acknowledged my realization rates were down only because of all of the work I did for "Partner X" (who had the client that wasn't paying until recently).

Having said all of this, would you all be disappointed in this situation? My past 3 years' annual bonuses would have been a bit higher had these amounts been realized during those years...$6MM in straight fees is a very large windfall for the firm....... so 10k seems like -- let's be honest -- a bit of a jack-off figure.

OR, am I totally overanalyzing this situation, and should take the money and just be thankful that anything was sent at all?


You are greedy and ungrateful. $10,000 is a lot of money (on top of your already high salary) and YOU DECIDED TO QUIT so boo-hoo-hoo.

Anonymous User
Posts: 306819
Joined: Tue Aug 11, 2009 9:32 am

Re: Would you be disappointed in this situation?

Postby Anonymous User » Mon Jan 08, 2018 2:59 pm

Don’t listen to these people who tell you you’re ungrateful. This opinion disregards the reality of your situation and the expectations you far exceeded at the firm... closing the deal for a terrible client and a terrible partner.

Here’s what I’d do (and in fact this is probably the only thing you can do other than let it go). I’d type out an email to the managing partner who told you that you’d be taken care of. Positive tone. Say how it was challenging as he understands working in a tight situation that you were able to close after six years and six million in fees. Mention numbers and hard data. So basically lay the groundwork in your email about the transaction, numbers, difficulties, etc. positive spin of course.

Then you need to discuss your prior bonuses and compensation at the firm, namely that you received $25k each year. Mention you went above and beyond as a third year to close this deal that posed endless problems for the firm. Keep in mind that the firm likely considered this a deal that would never close and wouldn’t be paid on this the $6mm is more or less a windfall.

Now, discuss how you’re happy you’re on good terms with the firm but that you were disappointed in light of the above tha you only received $10k, given your prior bonuses AND given that many firms (including maybe your current one) pay bonuses as a percentage of collections. If that were the case here, you’d be rich.

After typing that email, proofing it and sending it. I’d immediately call the managing partner at his office phone (when you know it will go straight to voicemail) and leave a message saying, hey boss I hope you’re doing well. I just typed up an email about the X day for you to share and discuss with your partners accordingly. Thanks for everything and please call me if you need anything. This shows your good faith.

Good luck.

lolwat
Posts: 1216
Joined: Tue Nov 16, 2010 2:30 pm

Re: Would you be disappointed in this situation?

Postby lolwat » Mon Jan 08, 2018 3:35 pm

Eh. You couldn't stay to get your bonus (which is fine, you had legitimate reasons) but you got something anyway. I suspect there are plenty of firms that might have thanked you for your service and never once mentioned anything about "taking care of you"--much less send you a check for any amount other than your final pro-rated salary if you were owed any. The unfortunate part is the partners got your hopes and expectations up with their comments.

Disappointing? Sure. I would be disappointed, too.

Wrong for the firm to do that? No.

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Desert Fox
Progressively loosing literacy
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Re: Would you be disappointed in this situation?

Postby Desert Fox » Mon Jan 08, 2018 3:37 pm

I don't think you are greedy or ungrateful for wanting more than 10k out of a 6 million dollar windfall. But:

1) you stupidly left before the bonus that year.

2) there wasn't a 6 million dollar windfall. Sure your work was a but-for cause of the payment, but really it was mostly payment for service already rendered by the firm. They rightfully don't view that 6 million as money only you earned them.

10k is cheap when they were claiming to "take care of you." But I probably would have thanked you for all the hard work and patted you on the back.
Last edited by Desert Fox on Fri Jan 26, 2018 11:22 pm, edited 1 time in total.

Anonymous User
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Joined: Tue Aug 11, 2009 9:32 am

Re: Would you be disappointed in this situation?

Postby Anonymous User » Mon Jan 08, 2018 3:47 pm

Delete double post
Last edited by Anonymous User on Mon Jan 08, 2018 3:49 pm, edited 1 time in total.

Anonymous User
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Re: Would you be disappointed in this situation?

Postby Anonymous User » Mon Jan 08, 2018 3:48 pm

Seems like they knew $10k was cheap due to the fact that it was burried in your termInation package. When companies or partners do something generous they usually go well out of their way to make their generosity plainly apparent.

You can hear all points of view on here but you have nothing to lose by sending an email explaining your disappointment and your request. Or you can stay disappointed and wonder what if/hear why everyone has to say on tLS.

Also keep in mind that partners at firms, espcially firms like yours that are under market, have the mindset of “let’s give him x that should keep him happy, but if he asks about it we’ll bump it up to x+10.”

RedPurpleBlue
Posts: 470
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Re: Would you be disappointed in this situation?

Postby RedPurpleBlue » Mon Jan 08, 2018 4:14 pm

Anonymous User wrote:Seems like they knew $10k was cheap due to the fact that it was burried in your termInation package. When companies or partners do something generous they usually go well out of their way to make their generosity plainly apparent.

You can hear all points of view on here but you have nothing to lose by sending an email explaining your disappointment and your request. Or you can stay disappointed and wonder what if/hear why everyone has to say on tLS.

Also keep in mind that partners at firms, espcially firms like yours that are under market, have the mindset of “let’s give him x that should keep him happy, but if he asks about it we’ll bump it up to x+10.”


1) This post shouldn't be anon

2) OP does have something to lose. The firm told him that he is "welcome back absolutely whenever," and that could change if he tries to get more money. If they view it as greedy, they could see OP as ungrateful and rescind that very good fallback option. I'm not saying OP can't pull it off or shouldn't do it, but saying that there is nothing to lose is blatantly false.

3) I'm going to echo what DF said. Yeah, maybe it seems cheap when they said they will "take care of you," but I probably would have just said "thanks, enjoy your new job" after giving you a nice fruit basket. This should not be remotely unexpected. You were an associate doing your job, and you bailed before bonuses were distributed. You got lucky that they were willing to send you anything. It's not like you were an equity partner billed on the matter and didn't get your rub.

Danger Zone
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Re: Would you be disappointed in this situation?

Postby Danger Zone » Mon Jan 08, 2018 4:50 pm

I'd be elated. Bonuses are for retention, not performance (unless explicitly stated otherwise, such as an eat what you kill environment).
Last edited by Danger Zone on Sat Jan 27, 2018 2:26 pm, edited 1 time in total.

CanadianWolf
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Re: Would you be disappointed in this situation?

Postby CanadianWolf » Sat Jan 20, 2018 9:12 pm

If your most recent bonus was $25,000, then suggest that amount. In my opinion, writing a letter or email simply stating that you had expected a larger bonus doesn't offer a clear cut option to the firm; requesting a bonus equal to your prior bonus sets an amount that certainly should be considered reasonable by the partners.




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