Mid-Year Bonuses

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Lawsohard99

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Re: Mid-Year Bonuses

Postby Lawsohard99 » Sun Jun 09, 2019 12:53 pm

Anonymous User wrote:
Anonymous User wrote:K&E associate here and would prefer not to be outed. Thank you in advance, mods.

We pay below market, and it's incredibly frustrating to me for there to be a common perception in the community that we pay above market. I think the issue is that most people come from a legal background and do not have an understanding on what "market" means. Market is the average the market is paying for certain services ("market"). Market is not the the base that the majority of firms use when making compensation decisions (the "base").

Almost all firms pay above the base for high billers. When I am billing 2,500 hours at K&E and get an extra $7,500 bonus, this is below market given that I have one friend at a V20 getting $7,500 for 2,400 hours and another friend getting $5,000 for 2,300 hours. K&E most definitely pays above base for high billers, but we pay below market.

Oh, and by the way, if we paid above market, we would have already at least matched Gunderson.


Other, less pessimistic K&E associate here.

Okay, but market is a term that everyone understands around here to mean paying Cravath scale without unreasonable hours demands, so the semantics lesson isn’t super helpful.

You are correct obviously in your analysis that base salaries vary in generosity depending on hours worked, but then why complain about us? K&E is one of a few firms I know that has absolutely no hours requirement, pays above market even to those who bill below the hours that would be bonus cutoffs at other firms, actually has a vaguely meaningful bonus increase for mega-billers, etc.

You and I agree, I assume, that it is not worth it to bill 3000 hours to get an extra X amount of dollars. BUT if you’re put in that situation, it’s a hell of a lot better to be at a firm that has a history of paying a generous multiplier. You may know of other firms that do that, but other than Wachtell and some boutiques, I don’t know of a firm with a more generous floor and a higher ceiling than we do.

Fundamentally, I do not bill more hours than my class year at other V20s, and yet for the last several years I have earned more than them. How is that below market? (Other than the current Gunderson embarrassment).


K&E makes it clear the incremental benefit of billing an extra 100 hours isn’t worth it as compared to actually doing good work and getting a better class rating... if you’re toiling away for 3000 hours but doing crappy work for an extra $5k that’s your fault vs billing 2200 and owning it and getting 1.5x at a minimum.

Agree with the earlier K&E poster that this is really just a timing issue and the market will ultimately see this money, it just depends on whether it falls into this fiscal year for partners vs. next fiscal year in the form of year end bonuses. Will be a weird dynamic if some firms don’t match now and then try to get publicity at year end by beating whatever is “market” then and you’ll end up with firms having to explain they actually already matched by paying these out back in July, which is also not a good look.

2013

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Re: Mid-Year Bonuses

Postby 2013 » Sun Jun 09, 2019 1:14 pm

To the K&E associate saying that average hours billed is 2500, that’s probably limited to your practice. K&E has insanely high rates and, in 2018, the revenue per lawyer was $1.65m or something. From what I’ve heard about K&E, many if not all the non-equity partners bill as much as associates. Therefore, to average $1.65m, there is no way many people at K&E are billing over 2000 a year.

The same goes for most top law firms. The firms that have the highest RPL have junior associate rates of like $700+ and partner rates in the mid $1000s, so, even with write-offs taken into account, it’s highly unlikely most associates at any of those firms is billing over 2000.

Doesn’t NALP have a section that shows the average number of associate hours billed for a previous year? I remember it always hovering around 1700.

K&E is above market because few people bill enough at competitors for K&E to be “below.”

ETA: clarification

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Re: Mid-Year Bonuses

Postby Anonymous User » Sun Jun 09, 2019 1:26 pm

@ 2013

Firms do not realize 100% of time billed.

As mentioned, we are not above market. We are above base like most other peer firms who want to retain high billing associates with good work product.

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Re: Mid-Year Bonuses

Postby Anonymous User » Sun Jun 09, 2019 5:53 pm

KE associate here. The firm's most recent presentation indicated something like 1960 as the average annual hours billed, although I don't recall if that was all attorneys or just associates (and I'm not sure how first years and laterals get calculated in that). I'm sure we will get more data at this firmwide town hall in a couple of days.

While we're on this diversion, my understanding of "market" bonuses are the Cravath etc. scale with lockstep bonuses. To the extent most associates get above the lockstep amount for their class year, that firm pays above market. It is definitely true that the marginal benefit of billing over, say, 2200 or 2300 at KE is extremely small. Your bonus at 2700 is likely not going to be much different from someone at 2300 such that your compensation for those last 400 hours will be small. But both the 2300 and the 2700 associate are certainly going to get bonuses above the 3rd year or 4th year lockstep amount, and probably by a decent amount. That doesn't necessarily mean that "above market" means "more than you'd get at every other firm" nor does it mean "worth the extra hours."

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whats an updog

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Re: Mid-Year Bonuses

Postby whats an updog » Sun Jun 09, 2019 7:49 pm

If I averaged 2500 hours, I’d be on suicide watch

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Re: Mid-Year Bonuses

Postby Anonymous User » Sun Jun 09, 2019 8:12 pm

"That doesn't necessarily mean that 'above market' means 'more than you'd get at every other firm' nor does it mean 'worth the extra hours.'"

This quote is exactly what I am referring to when I say most lawyers do not understand what "market" means. In the business world, above market means more compensation than the average being paid in the market for certain services. So while I am getting an additional $7,500 above lockstep at K&E for 2,500 hours and someone at a V20 is getting an additional $7,500 above lockstep for 2,400 hours, K&E very well may be paying below market compared to peer firms. We do not know for certain because we would need more data.

This is why the process is as opaque as it can be, and why so many firms do not actually advertise that they pay above lockstep--if they did, there would be more transparency and we associates would take more of the slice of the pie away from partners.

At the end of the day, K&E simply does not pay above market solely because it is transparent about paying above lockstep. We cannot know what market is because it is all anecdotal, but I have heard several examples of people my year receiving more compensation than me on a per hour basis.

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Re: Mid-Year Bonuses

Postby 2013 » Sun Jun 09, 2019 8:56 pm

Anonymous User wrote:"That doesn't necessarily mean that 'above market' means 'more than you'd get at every other firm' nor does it mean 'worth the extra hours.'"

This quote is exactly what I am referring to when I say most lawyers do not understand what "market" means. In the business world, above market means more compensation than the average being paid in the market for certain services. So while I am getting an additional $7,500 above lockstep at K&E for 2,500 hours and someone at a V20 is getting an additional $7,500 above lockstep for 2,400 hours, K&E very well may be paying below market compared to peer firms. We do not know for certain because we would need more data.

This is why the process is as opaque as it can be, and why so many firms do not actually advertise that they pay above lockstep--if they did, there would be more transparency and we associates would take more of the slice of the pie away from partners.

At the end of the day, K&E simply does not pay above market solely because it is transparent about paying above lockstep. We cannot know what market is because it is all anecdotal, but I have heard several examples of people my year receiving more compensation than me on a per hour basis.


K&E is still above market because Joe Schmo associate who bills 1800 hours will almost definitely get a bonus above Cravath’s standard. No other competitor pays bonuses above Cravath for bare minimum performance. And, some “market” firms that are the lower-end competitors of K&E attach 1900-2000 billable minimums for ANY bonus.

So, yes, it’s above market. I don’t think YOU understand what above market means.

At the end of the day, Cravath is able to get top notch talent at its bonus levels. Anyone paying anything more is above market because Cravath clearly indicates that the market can support top talent. Paying above what the market needs to sustain is above market.

Gunderson doing what it did was absolutely not necessary but I’m assuming that the bonuses have a lot more to do with the firm trying to expand some of its offices.

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Re: Mid-Year Bonuses

Postby Anonymous User » Sun Jun 09, 2019 9:09 pm

@ 2013

Similar to your earlier post containing the incorrect assumption of 100% realization, here you incorrectly assume that if some associates at K&E are billing below average hours and being paid above lockstep, then that means K&E on the whole pays above market. My contention is that, given the evidence I have come upon, K&E is likely paying its associates less on the whole on a per hour basis than other peer firms.

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Re: Mid-Year Bonuses

Postby 2013 » Sun Jun 09, 2019 9:16 pm

Anonymous User wrote:@ 2013

Similar to your earlier post containing the incorrect assumption of 100% realization, here you incorrectly assume that if some associates at K&E are billing below average hours and being paid above lockstep, then that means K&E on the whole pays above market. My contention is that, given the evidence I have come upon, K&E on a per hour basis is likely paying its associates less on the whole on a per hour basis than other peer firms.



First off, I didn’t say 100% realization. I specifically mentioned write offs.

Second, no one measures biglaw salary by billable hour. But if you want to, then, yes, K&E pays less per billable hour than many of its competitors.

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Re: Mid-Year Bonuses

Postby Anonymous User » Sun Jun 09, 2019 9:56 pm

@ 2013

"First off, I didn’t say 100% realization. I specifically mentioned write offs."

Understood, but you did not mention write offs with respect to your introductory K&E analysis.

"Second, no one measures biglaw salary by billable hour. But if you want to, then, yes, K&E pays less per billable hour than many of its competitors."

This, again, is the point I am making. Almost all lawyers seem to believe lockstep equals market. In any other segment of the economy, if you were to say one employer pays less than the average of all employers on a per hour basis, such employer would undoubtedly be known for paying below market. So I think we essentially agree.

Ultramar vistas

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Re: Mid-Year Bonuses

Postby Ultramar vistas » Sun Jun 09, 2019 11:32 pm

Anonymous User wrote:"That doesn't necessarily mean that 'above market' means 'more than you'd get at every other firm' nor does it mean 'worth the extra hours.'"

This quote is exactly what I am referring to when I say most lawyers do not understand what "market" means. In the business world, above market means more compensation than the average being paid in the market for certain services. So while I am getting an additional $7,500 above lockstep at K&E for 2,500 hours and someone at a V20 is getting an additional $7,500 above lockstep for 2,400 hours, K&E very well may be paying below market compared to peer firms. We do not know for certain because we would need more data.

This is why the process is as opaque as it can be, and why so many firms do not actually advertise that they pay above lockstep--if they did, there would be more transparency and we associates would take more of the slice of the pie away from partners.

At the end of the day, K&E simply does not pay above market solely because it is transparent about paying above lockstep. We cannot know what market is because it is all anecdotal, but I have heard several examples of people my year receiving more compensation than me on a per hour basis.


Where is this 7500 number coming from? If you bill 2500 as a third year or more, with an average class ranking, you will be getting 10K or more above market.

What are these other firms that all your friends are working for, that that pay above market bonuses for fewer hours than it would take a Kirkland associate to earn the same bonus?

None of your statements make any sense, and neither does your insistence on another use of the word “market” than literally everyone else on this website.

Also, what other salaried professional services work out compensation on an hourly basis? I don’t hear the folks over in the MBA forums figuring out that the hourly comp of a Blackstone analyst is actually less than at Goldman because their hours went up marginally...

If Cravath, Simpson, Paul Weiss, Cleary, Kirkland, Davis Polk, etc all pay summer bonuses then that is MARKET regardless of whether associates outside of the V10 are, hypothetically, billing fewer hours. Wachtell pays above market, even though allegedly 2800 is the norm. Susman pays above market, even though allegedly they are all billing outsized numbers. You may be upset with your life choices, but K&E pays above market and - perhaps no one told you, or you took everyone’s claims of outrageous work habits seriously - you don’t actually have to bill that much to get a good bonus!

dabigchina

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Re: Mid-Year Bonuses

Postby dabigchina » Mon Jun 10, 2019 1:41 am

if you people want to argue about kirkland's bonus structure, go do it in your own thread.

itt we talk about [how we are not getting] summer bonus.

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NotASpecialSnowflake

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Re: Mid-Year Bonuses

Postby NotASpecialSnowflake » Mon Jun 10, 2019 9:33 am

dabigchina wrote:
purpletiger wrote:People need to stop debating Kirkland bonuses and get back to agitating for Gunderson matches.


The fact that this has turned into a Kirkland bonus thread speaks volumes about how dead the dream is.

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Re: Mid-Year Bonuses

Postby Anonymous User » Mon Jun 10, 2019 9:53 am

This is the anon K&E associate. Apologies, the point was not to discuss at length K&E's bonus structure. The point was that since in actuality K&E does not pay above market, it will not be first to match/surpass Gunderson on summer bonuses.

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Re: Mid-Year Bonuses

Postby Anonymous User » Mon Jun 10, 2019 11:32 am

I heard from a buddy that Pillsbury has announced summer bonuses - can anyone confirm?

2013

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Re: Mid-Year Bonuses

Postby 2013 » Mon Jun 10, 2019 12:01 pm

Anonymous User wrote:I heard from a buddy that Pillsbury has announced summer bonuses - can anyone confirm?


Highly doubt a firm that didn’t even raise to 190 and gave bonuses in two installments last year would be giving bonuses before almost everyone. And if it did, it’s probably to make up for it’s below market salary

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rokiv

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Re: Mid-Year Bonuses

Postby rokiv » Mon Jun 10, 2019 2:48 pm

No confirmation on Pilsbury?

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LaLiLuLeLo

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Re: Mid-Year Bonuses

Postby LaLiLuLeLo » Mon Jun 10, 2019 3:18 pm

lol @ anyone who believes Pilsbury will be the second mover.

(Fully aware this comment may not age well)

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Re: Mid-Year Bonuses

Postby Anonymous User » Mon Jun 10, 2019 3:30 pm

My friend just left Pills because no 190k or summer bonus. I’d be super surprised if they gave a summer bonus.

charliekelly33

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Re: Mid-Year Bonuses

Postby charliekelly33 » Mon Jun 10, 2019 4:39 pm


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Re: Mid-Year Bonuses

Postby Anonymous User » Mon Jun 10, 2019 4:49 pm

V&E just announced a summer bonus holiday as we all get Friday, July 5 off this year in addition to July 4. Lol, at least it's something.

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LaLiLuLeLo

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Re: Mid-Year Bonuses

Postby LaLiLuLeLo » Mon Jun 10, 2019 5:05 pm

Anonymous User wrote:V&E just announced a summer bonus holiday as we all get Friday, July 5 off this year in addition to July 4. Lol, at least it's something.


I was just complaining how that’s not a day off. Tuesday/Thursday holidays...just give just the 4 day weekend! It won’t be productive anyway!

TheatreofDreams

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Re: Mid-Year Bonuses

Postby TheatreofDreams » Mon Jun 10, 2019 5:55 pm

Is the V&E bonus posted on Abovethelaw? That would be helpful...
Last edited by QContinuum on Tue Jun 11, 2019 10:25 pm, edited 1 time in total.
Reason: Outed for anon abuse.

NoLongerALurker

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Re: Mid-Year Bonuses

Postby NoLongerALurker » Mon Jun 10, 2019 5:58 pm

V&E bonus post got my hopes up before I realized it was just a joke about having another day off. Sigh.

ghostoftraynor

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Re: Mid-Year Bonuses

Postby ghostoftraynor » Mon Jun 10, 2019 6:33 pm

You guys are forgetting market is based on $/hour now. With one less day of work, V&E is new market leader.



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