Milbank/Davis Polk/Cravath Scale: NYC to 215-415k Forum

[Anonymous User]

Anyone know if Kirkland re-raised to match Cravath or still only matched DPW?

We haven't updated to match Cravath, but there's a 100% chance that we will prior to the March 15th payroll.

[Anonymous User]

How does a firm determines its billing rate? Wouldn't it be in the firm's interest to bill the highest amount it can collect/get away with? What I don't get is how a v25 firm can bill out its senior associates at almost twice the rate of a v75 firm, yet both firms pay senior associates at the same salary scale.

[Anonymous User]

How does a firm determines its billing rate? Wouldn't it be in the firm's interest to bill the highest amount it can collect/get away with? What I don't get is how a v25 firm can bill out its senior associates at almost twice the rate of a v75 firm, yet both firms pay senior associates at the same salary scale.

They don't, most lower v100s compress at some point.

[Anonymous User]

Latham match, paid March 31 and retroactive to Jan 1. Includes certain (but not all) international offices.

[Anonymous User]

How does a firm determines its billing rate? Wouldn't it be in the firm's interest to bill the highest amount it can collect/get away with? What I don't get is how a v25 firm can bill out its senior associates at almost twice the rate of a v75 firm, yet both firms pay senior associates at the same salary scale.

They don't, most lower v100s compress at some point.

Yep, my v100 pays market for all 8 years (hasn't matched this year yet) but based on performance review. AKA if you hit your hours and are killing it all 8 years, you get paid, but if they ever decide you're not, you don't.

[Anonymous User]

How does a firm determines its billing rate? Wouldn't it be in the firm's interest to bill the highest amount it can collect/get away with? What I don't get is how a v25 firm can bill out its senior associates at almost twice the rate of a v75 firm, yet both firms pay senior associates at the same salary scale.

They don't, most lower v100s compress at some point.

Yep, my v100 pays market for all 8 years (hasn't matched this year yet) but based on performance review. AKA if you hit your hours and are killing it all 8 years, you get paid, but if they ever decide you're not, you don't.

Interesting. Say, if they decide you're not up to par re performance, you're simply not getting paid market? When do you actually get the boot?

[Anonymous User]

Over/Under is page 100 in this thread before the first V10 match/raise

Not quite, but we did hit 100 before the market finished making moves!

[Anonymous User]

How does a firm determines its billing rate? Wouldn't it be in the firm's interest to bill the highest amount it can collect/get away with? What I don't get is how a v25 firm can bill out its senior associates at almost twice the rate of a v75 firm, yet both firms pay senior associates at the same salary scale.

A firm can't just decide one year to double their rates to start matching the V10. Clients wouldn't stand for it. Some firms may be able to raise in big increments and get away with it, but once you start moving down the list (generally; Vault doesn't directly correlate to billing rates) it gets harder and harder to justify.

Firms therefore have to play a delicate balancing game by raising rates just enough that they don't stand out from the rest of the industry . If a firm backs off for a couple years they can end up significantly behind their former peers since rate increases compound. If a firm wants to play catch up, it can take a long time to do so without raising eyebrows.

Lower ranked firms also have to attract talent, which is why they pay market (or close to market) and take a profits hit for it. For better or for worse, biglaw associates expect to be paid about the same, so a firm that starts to break that trend is going to lose out bigtime unless they have another sell (maybe 1500 hours target or something).

There's nothing that requires the market for associates' work to directly match the market for associates' salaries. Plus, firms that charge high amounts for associates can do so because the client is paying for the partners that they want on a matter, not because the associates' work is inherently more valuable.

[Anonymous User]

Latham match, paid March 31 and retroactive to Jan 1. Includes certain (but not all) international offices.

Now I wonder if some firms that matched DPW with a mid-March true-up will change course and match Cravath with an end-of-March true-up instead.

[Anonymous User]

Debevoise matched Cravath.

[Anonymous User]

PW did this as well - true-up will be included in the March 31 paycheck (was previously supposed to be paid March 15). The special discretionary bonus will still be included in the March 15 paycheck though.

[Anonymous User]

So do we now have three compensation leaders? lol

[Anonymous User]

Ranking Milbank 10 for first mover and CSM 9 for re-raising. Ranking DPW 1 for dragging their asses only to be reupped.

[Anonymous User]

Where's Freshfields in the list? I thought they matched DPW some days ago

[Anonymous User]

Ranking Milbank 10 for first mover and CSM 9 for re-raising. Ranking DPW 1 for dragging their asses only to be reupped.

Too late, I already ranked before the reraise. Also CSM dragged just as much, nothing stopping them from announcing this the day after Milbank scale.

[Anonymous User]

Hogan Lovells town hall happening now.... TBD....

[Anonymous User]

Ranking Milbank 10 for first mover and CSM 9 for re-raising. Ranking DPW 1 for dragging their asses only to be reupped.

Too late, I already ranked before the reraise. Also CSM dragged just as much, nothing stopping them from announcing this the day after Milbank scale.

I think it's clear now that CSM and DPW were playing cat and mouse to see who could have the last word. Arguably, DPW is more commendable for finally breaking the silence.

[Anonymous User]

Hogan Lovells town hall happening now.... TBD....

Hogan just announced...

That they'll be doing 5% extra bonus at 2100 hours; 10% at 2200; 15% at 2300; 20% at 2400.

Nothing on Cravath scale other than they're "watching" the compensation market to see how the firm will "adapt."

[Anonymous User]

Hogan Lovells town hall happening now.... TBD....

Hogan just announced...

That they'll be doing 5% extra bonus at 2100 hours; 10% at 2200; 15% at 2300; 20% at 2400.

Nothing on Cravath scale other than they're "watching" the compensation market to see how the firm will "adapt."

Lol, that's not "matching." When does Hogan plan to pay its bonus?

PW's bonus pays on 3/15. When does Desmarais plan to pay its "spring bonus"?

[Anonymous User]

ATL is reporting that Latham is paying $425 for 9th years, in case anybody is wondering: https://abovethelaw.com/2022/03/the-mon ... glaw-firm/.

[Anonymous User]

Hogan Lovells town hall happening now.... TBD....

Hogan just announced...

That they'll be doing 5% extra bonus at 2100 hours; 10% at 2200; 15% at 2300; 20% at 2400.

Nothing on Cravath scale other than they're "watching" the compensation market to see how the firm will "adapt."

Lol, that's not "matching." When does Hogan plan to pay its bonus?

PW's bonus pays on 3/15. When does Desmarais plans to pay its "spring bonus"?

They didn't pretend they were matching. Hogan pays bonus on Dec. 31, so last year they paid market for anyone above 2000 hours, but none of these step extra raises. This is a (reasonable) ploy for the current billable year to get people to bill extra and not just peace out at 2001 hours.

[Anonymous User]

I've seen a couple questions from people asking what happens for attorneys above 8th year. As far as I can tell, the "good" firms (V50) will scale the salary increases along with the rest of the market. Meaning, for example, if you were an 11th year making 415k before all this went down, you'll see your base go up by **counts with fingers** 50k, so now to 465k; they try to keep the compensation differential equivalent. That makes sense if you think about it because otherwise you'd create disgruntlement among more senior attorneys as their compensation compresses against regular senior associates.

[Anonymous User]

So with how much money these firms are paying for 7th year associates... What happens if that 7th year fails to make partner?

I don't even know where to start with this question. Are you a law student? In biglaw? First off, class of 2014 is an 8th year (which is included on the CSM scale) - I assume what you meant is what happens if an 8th year doesn't make partner?

What does the scale look like for the class of 2013? 2012?

As we've seen for the DPW scale, which also went to 2014, some firms just pay 2014+ the same rate (often listed in the memo as 2014+). Other firms have gone a step above (I think $10k) for 2013. Other firms are intentionally opaque about pay for 2013+. That's to say, it's entirely firm dependent. Some may pay even more to signal to certain seniors that partnership is a real possibility.

Are these associates going to get pushed out if they don't make partner?

Again, this is incredibly firm dependent. But if you're question is "are all associates after 2014 pushed out immediately because there isn't a specific salary figure on the CSM scale for them?" then the answer is absolutely not. A quick search through the attorney roles at any firm that lists graduation years could answer that. Lots of firms have a 10y+ track to partnership. Plus, lots of firms are opening up permanent counsel roles as an alternative to the up or out model.

Yes I am a law student. Thanks for the info.

[Anonymous User]

I've seen a couple questions from people asking what happens for attorneys above 8th year. As far as I can tell, the "good" firms (V50) will scale the salary increases along with the rest of the market. Meaning, for example, if you were an 11th year making 415k before all this went down, you'll see your base go up by **counts with fingers** 50k, so now to 465k; they try to keep the compensation differential equivalent. That makes sense if you think about it because otherwise you'd create disgruntlement among more senior attorneys as their compensation compresses against regular senior associates.

But is a super senior really more "senior" to a regular senior? Up or out may be dead but at that point you've been passed over for partnership.

[Anonymous User]

I've seen a couple questions from people asking what happens for attorneys above 8th year. As far as I can tell, the "good" firms (V50) will scale the salary increases along with the rest of the market. Meaning, for example, if you were an 11th year making 415k before all this went down, you'll see your base go up by **counts with fingers** 50k, so now to 465k; they try to keep the compensation differential equivalent. That makes sense if you think about it because otherwise you'd create disgruntlement among more senior attorneys as their compensation compresses against regular senior associates.

But is a super senior really more "senior" to a regular senior? Up or out may be dead but at that point you've been passed over for partnership.

I guess it depends on who we're talking about. At my firm (a V25), it's routine to see people have to wait 10, 12, 14 years before they get equity (it's also routine to see people's billing rates continue to go up over those years!). So, in my example, that 11th year attorney isn't "passed over for partnership" he/she is in the running recognizing it's a much more extended track. My impression is those sort of people are all continuing to benefit from the comp. gains. If we're talking about a 25th year of counsel that's a different ball of wax.

Also, I think the fact that that dynamic exists broadly within the market (less up or out; people having to spend more time in the trenches of "income partner" or "super senior" status before they can get equity) also contributes to why those sort of attorneys are continuing to get raises. Because if firm X doesn't bump the comp. for the 11th year, firm Y certainly will and suddenly the first firm has lost someone bringing them 2-2.5m revenue & with a developed skillset because they wanted to get stingy over a 50k raise.