Biglaw Salaries going up? Forum

[Johann]

I don't really care about salaries I just don't want the economy to tank in the next 2-3 years.

yeah this. i have enough money to do what i want. 30k would matter, but its not going to improve my day to day life other than getting out of here sooner. i mainly just dont want to be shitcanned and have 0 skills other than oh you need me to write a memo summarizing that document/conference call.

[Desert Fox]

Who are these mega shitfirms? Are we talking Baker Daniels? or is this just counting staff attorneys who technically work for a big firm.

[Anonymous User]

I've heard rumblings that a couple top firms are considering a salary raise to put the squeeze on other firms that aren't doing too well.

[Desert Fox]

I've heard rumblings that a couple top firms are considering a salary raise to put the squeeze on other firms that aren't doing too well.

This only makes sense if they are worried about losing midlevels to other firms. Because 2Ls tend to already select for prestige anyway. Dont have to pay for it .

[Hutz_and_Goodman]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

[84651846190]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

I think that's a fairly reasonable bet if you're talking about *any* firm raising salaries above 160k (other than the ones that already have). If you're talking about *all* biglaw firms (or at least all of the firms that were 160k pre-crash, then no fucking way.

[2014]

Does those of you more educated than I think if it happens it's going to be a one-off firm (like Boies currently) or it will be a haves/have nots situation where a dozen or whatever wealthier (presumably NY) firms raise it and the rest stick at 160 for the time being?

Sub question - would anyone expect DC/Chi/LA/SF firms currently paying 160 to match a NY raise?

[Monochromatic Oeuvre]

Salaries are never going to go up simultaneously across all biglaw firms like they did during the 2000s. From now on, I think the tippy top firms are going to continue distinguishing themselves more and more from the rest of biglaw when it comes to total comp. There will be a sliding scale of salary increases (or lack thereof) with the crappier firms giving only very small or non-existent salary increases.

Agree with the prediction that it will segment. Only minor quibble is that I wouldn't term the firms that don't keep up with the market to be "Biglaw" at all, in the same way we don't consider a place like Fragomen or Jackson Lewis to be "Biglaw" despite being large law firms. However that fragmentation plays out, my rule will be that if three or more large (101+) firms in the city pay more than a firm, it gets stripped of the Biglaw designation and is branded a TTT.

[Desert Fox]

Biglaw is going to split into two totally separate tiers based on billable rates. I'm sure eventually comp will split too. But I see no reason for V20 firms to blow it out re: comp. They already get the top talent for no increase.

[Monochromatic Oeuvre]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

I'd place an even-money bet on any firm currently paying at least a $160k base to first-years to raise the base salary of any class level within a year.

[Monochromatic Oeuvre]

I don't really care about salaries I just don't want the economy to tank in the next 2-3 years.

I'd forego any salary increase if a firm guaranteed that (a) it would never no-offer for financial reasons, (b) associates laid off for financial reasons would be hired back before any laterals or new summer offers, and (c) it would pay half-salary to anyone fired for financial reasons until they could be hired back.

[Hutz_and_Goodman]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

I think that's a fairly reasonable bet if you're talking about *any* firm raising salaries above 160k (other than the ones that already have). If you're talking about *all* biglaw firms (or at least all of the firms that were 160k pre-crash, then no fucking way.

I'm talking about V50 firms NYC offices going above $160k. Five or more firms will do it by January 1, 2017.

[Johann]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

i'm in depending on the bet. more than 25 V100 NYC firms paying >= 190k base for first years on January 1 2017 or more than 15 V100 firms paying >= 190k base for first years on January 1 2017 in NYC and 1 office. I'll take either.

I'm obviously on the short side.

[dixiecupdrinking]

I don't really care about salaries I just don't want the economy to tank in the next 2-3 years.

I'd forego any salary increase if a firm guaranteed that (a) it would never no-offer for financial reasons, (b) associates laid off for financial reasons would be hired back before any laterals or new summer offers, and (c) it would pay half-salary to anyone fired for financial reasons until they could be hired back.

I have a weird feeling you'll forgo a pay increase and not get any of that. What are you gonna do? Go to another firm paying the same thing?

Some weirdo firm will probably raise salaries by 2017 but I really doubt we see a new "market," even among some subset of elite firms.

[m.r.ducks]

There are multiple vault firms and well established boutiques (Buckley Sandler) that pay under 160 here in DC. Sure the V20 pay market, but there is more disparity than one would think given the cost of living. Even elite practice groups primarily based in DC are not immune. McKenna just raised their salary to 160 last year, this despite having the best government contracts business in the US. That business is now moving to Covington due to the Dentons merger. Many of these Mid/lower Vault firms lowered salary during the recession and never went back up. See. eg., Nixon Peabody. There simply is no business justification to raise salaries, bonus pools provide the flexibility to adjust to changing market conditions where salaries did not. Associates are fungible.

[Monochromatic Oeuvre]

There are multiple vault firms and well established boutiques (Buckley Sandler) that pay under 160 here in DC. Sure the V20 pay market, but there is more disparity than one would think given the cost of living. Even elite practice groups primarily based in DC are not immune. McKenna just raised their salary to 160 last year, this despite having the best government contracts business in the US. That business is now moving to Covington due to the Dentons merger. Many of these Mid/lower Vault firms lowered salary during the recession and never went back up. See. eg., Nixon Peabody. There simply is no business justification to raise salaries, bonus pools provide the flexibility to adjust to changing market conditions where salaries did not. Associates are fungible.

Wasn't the bonus flexibility and associate fungibility present when salaries were raised three times in seven years? Why would firms not do it this time?

[Hutz_and_Goodman]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

i'm in depending on the bet. more than 25 V100 NYC firms paying >= 190k base for first years on January 1 2017 or more than 15 V100 firms paying >= 190k base for first years on January 1 2017 in NYC and 1 office. I'll take either.

I'm obviously on the short side.

I'm not betting 190k. I'm betting 170k+.

[Desert Fox]

Dc big law is still worth it. It's shocking how much better the firm's treat people.

[sublime]

..

[m.r.ducks]

You're absolutely right, these same options were available to firms before. I think firms are smarter than they were prior. That and irrational exuberance made them, well irrational. I was an ibanker before and there was every reason to raise salaries in the 2006/2007, but even, salaries stayed fairly constant. You might get the top flight firms to raise salaries, but the rest seem very comfortable just remaining with the rest of the pack. Somewhat unrelated, but lock-step raises have also disappeared, and there is no way merit based pay is making associates better off.

[Johann]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

i'm in depending on the bet. more than 25 V100 NYC firms paying >= 190k base for first years on January 1 2017 or more than 15 V100 firms paying >= 190k base for first years on January 1 2017 in NYC and 1 office. I'll take either.

I'm obviously on the short side.

I'm not betting 190k. I'm betting 170k+.

Yeah I think that's fair. I'd take also take this: more than 25 V100 NYC firms paying >= 176k base for first years on January 1 2017 or more than 15 V100 firms paying >= 176k base for first years on January 1 2017 in NYC and 1 office. I'll take either.

But yeah it wouldn't surprise me to see 15-20 firms paying 170k in NYC and DC/LA by 2017.

[Cobretti]

Does those of you more educated than I think if it happens it's going to be a one-off firm (like Boies currently) or it will be a haves/have nots situation where a dozen or whatever wealthier (presumably NY) firms raise it and the rest stick at 160 for the time being?

Sub question - would anyone expect DC/Chi/LA/SF firms currently paying 160 to match a NY raise?

Not more educated than you, but... I think what we are talking about here is something like the V10~20 separating from the pack, there are already one offs (like you mentioned) and another one wouldn't necessarily be a significant occurance.

As far as not everyone following an increase, the financial metrics seem to keep showing a greater schism between the top firms and the rest of the pack, so it would make sense that compensation would follow. And my thoughts on the secondary 160 markets are that this same thing will play out, but it would be much more significant because fewer secondary market firms/offices are comparable to NYC profitability. A lot of these markets just simply aren't that profitable (DC Lit is an example, its prestigious as hell but at the end of the day transactional is just more profitable for just about every firm outside of PW/GDC), and there may be few (if any) firms/offices willing to follow an increase. More transactional focused and profitable secondaries like Chicago/SF/SV could see more firms follow suit though (personal wishful thinking may bias me here.....).

Hopefully internal pressure within firms with highly integrated offices will get them to increase in secondaries though, which would put pressure on others in the market. There are firms like Skadden that would definitely increase in NYC but then have such integrated secondary offices that they might face more pressure than other firms to increase comp across the board. Maybe just wishful thinking, but the simple fact that this is already how it is currently should support something similar happening in the future.

[Mal Reynolds]

Maybe this summer all the SAs should just casually mention to any partner they see that salaries are going up. Maybe it will start a frenzy whereby rumor turns to truth.

[Cobretti]

If anyone on here wants to bet on base salary going up by January 1, 2017 let me know. I have $500 that says YES.

If anyone betting Hutz wants to double down, I'll take the same bet

[Anonymous User]

Why are people talking about vault rankings and not PPP rankings when deciding if firms will be able to raise salaries?