Kirkland Bonuses? Forum

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Re: Kirkland Bonuses?

Post by Anonymous User » Thu Dec 30, 2021 1:04 pm

It might be too late for it, but it would have been helpful to get clear on which firms ended up not following the market on the December special bonus. Everything got jumbled up in the pre-Christmas rush of announcements, but a few firms matched what ended up being market for the end-of-year bonus, but then did not match the Special Bonus.

Kirkland seems to have gone out of its way to minimize the impact of it on their all-in comp calculations. Jones Day and GDC are black boxes, so hard to tell. Boies Schiller ignored the special bonus entirely. Are there other elite firms that tried to skate by like this?

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Re: Kirkland Bonuses?

Post by Anonymous User » Thu Dec 30, 2021 1:11 pm

Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.

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Re: Kirkland Bonuses?

Post by Anonymous User » Thu Dec 30, 2021 1:26 pm

Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
Seriously. What a cringe take with zero understanding of tax deferral. I hope that anon is litigation.

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Re: Kirkland Bonuses?

Post by Anonymous User » Thu Dec 30, 2021 7:55 pm

Anonymous User wrote:
Thu Dec 30, 2021 1:26 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
Seriously. What a cringe take with zero understanding of tax deferral. I hope that anon is litigation.
It amazes me that there is not more information out there about how little financial sense being a NSP at Kirkland (homegrown one) makes (assuming you don’t have one of those superstar contracts where they think you aren’t share partner material but don’t want you to leave and pay you like $1MM). The whole process as everyone is aware is to basically let the share partnership transfer certain costs off its books, be able to bill you out at a higher rate and somehow permit you “additional exit opportunities”. This is why you don’t have to really jump through any hoops to be a NSP. It’s in the firm’s interest to make everyone a NSP. No child left behind! All this is in exchange for a massive financial trade off than if the NSP remained an associate at Kirkland or elsewhere. When you are a NSP:

1) your health benefits aren’t covered, so you are paying the full price and if you have a family this could be an extra 1000 or more a check based on what you would pay as an associate for no additional benefit.
2) your social security and Medicare is no longer also paid by the firm, which means you’re paying double compared to if you are an associate
3) the required defined contribution amount…to the op’s point, maybe they can use the money more right now v. having an obligation to fund this
4) you pay taxes on income sourced from other states (so this can come out to 800 and more a check)
5) all of the above is in addition to paying your other state income taxes, if applicable.

The above is only manageable to swallow, again, if you’re getting some lateral starting salary that is much higher than what Kirkland pays it’s homegrown NSPs (which is basically the lockstep associate scale). So, they say, you are supposed to make up the difference in your bonus…that clearly didn’t happen this year.

So, in short, compared to if you were an associate, you’re looking at paying an additional 80K plus in taxes and additional contributions compared to if you’re an associates plus additional hours and less support in exchange for a hollow title. Moral of the story is if you are intent on being a NSP at Kirkland, lateral to Kirkland as a NSP and negotiate the hell out of your contract and sign-on bonus. Do not expect to earn on paper much higher, if at all, than an associate if you are home grown talent. And remember, even if you earn a little more on paper, you’re going to be in the red because of all the additional taxes and contributions.

Anonymous User
Posts: 428110
Joined: Tue Aug 11, 2009 9:32 am

Re: Kirkland Bonuses?

Post by Anonymous User » Thu Dec 30, 2021 8:36 pm

Anonymous User wrote:
Thu Dec 30, 2021 7:55 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:26 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
Seriously. What a cringe take with zero understanding of tax deferral. I hope that anon is litigation.
It amazes me that there is not more information out there about how little financial sense being a NSP at Kirkland (homegrown one) makes (assuming you don’t have one of those superstar contracts where they think you aren’t share partner material but don’t want you to leave and pay you like $1MM). The whole process as everyone is aware is to basically let the share partnership transfer certain costs off its books, be able to bill you out at a higher rate and somehow permit you “additional exit opportunities”. This is why you don’t have to really jump through any hoops to be a NSP. It’s in the firm’s interest to make everyone a NSP. No child left behind! All this is in exchange for a massive financial trade off than if the NSP remained an associate at Kirkland or elsewhere. When you are a NSP:

1) your health benefits aren’t covered, so you are paying the full price and if you have a family this could be an extra 1000 or more a check based on what you would pay as an associate for no additional benefit.
2) your social security and Medicare is no longer also paid by the firm, which means you’re paying double compared to if you are an associate
3) the required defined contribution amount…to the op’s point, maybe they can use the money more right now v. having an obligation to fund this
4) you pay taxes on income sourced from other states (so this can come out to 800 and more a check)
5) all of the above is in addition to paying your other state income taxes, if applicable.

The above is only manageable to swallow, again, if you’re getting some lateral starting salary that is much higher than what Kirkland pays it’s homegrown NSPs (which is basically the lockstep associate scale). So, they say, you are supposed to make up the difference in your bonus…that clearly didn’t happen this year.

So, in short, compared to if you were an associate, you’re looking at paying an additional 80K plus in taxes and additional contributions compared to if you’re an associates plus additional hours and less support in exchange for a hollow title. Moral of the story is if you are intent on being a NSP at Kirkland, lateral to Kirkland as a NSP and negotiate the hell out of your contract and sign-on bonus. Do not expect to earn on paper much higher, if at all, than an associate if you are home grown talent. And remember, even if you earn a little more on paper, you’re going to be in the red because of all the additional taxes and contributions.
1) This is definitely an extra cost compared to being an associate elsewhere and it's absolutely a real hit that people should be aware of. With the way this interacts with taxes, it's not the full hit, and they do partially subsidize junior NSPs premiums (or they used to before the raises, not sure if they've stopped doing that), but it's definitely a hit.

2) Also totally true. Again, with the way this interacts with taxes, it's not the full hit--but still, a very meaningful hit.

3) Anyone in this situation is flat-out doing it wrong. To the overwhelming majority of people, extra tax-deferred space is gold. This is a positive, not a detriment. I don't know enough about ERISA and benefit plan stuff to know whether they could allow people to "opt out" of this--possible that doesn't actually "work." That said, at least under current law, the benefit would be reduced (but not eliminated) if you're comparing it to the (still minority) of firms that permit the mega backdoor ROTH.

4/5) This somewhat overstates the hit from incremental state taxes, given the way cross-state crediting works. Unless you're in Texas or, to a somewhat lesser extent, Illinois, though if you're in one of those states you don't have the same scope of alternative options, either. Not sure what you mean on 5. Everyone has to pay home-state income tax, NSP or not.

This year's bonuses were a system shock, for sure, because the incremental bonuses over market definitely used to make up for these costs but, this year, it seems like it may not have for a lot of people. Even from this thread though, the significant majority of people were still over market--just not as over market as they used to be and, when the incremental costs associated mostly with the insurance and self-employment tax are taken into account, probably did worse than market, but I bet not by the amount implied by quoted post. Still, it's unfortunate, and I wonder whether they really thought it through for the NSPs (they legitimately may not have fully run the numbers).

That said, part of it is definitely holding out the "real partnership" carrot where you're making more at KE than other shops--which they did shorten by a year this year. More senior NSPs do seem to have pretty good landing spots even when they don't end up making partner--there's some truth to the exit options thing, though it's obviously hard to measure that against senior associates at other shops that try to lateral to partner positions elsewhere. But, no doubt, NSP at Kirkland is a different thing from senior associate at other places. Maybe higher risk higher reward kind of thinking ultimately drives it? Who knows.

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Anonymous User
Posts: 428110
Joined: Tue Aug 11, 2009 9:32 am

Re: Kirkland Bonuses?

Post by Anonymous User » Thu Dec 30, 2021 8:53 pm

Anonymous User wrote:
Thu Dec 30, 2021 7:55 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:26 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
Seriously. What a cringe take with zero understanding of tax deferral. I hope that anon is litigation.
It amazes me that there is not more information out there about how little financial sense being a NSP at Kirkland (homegrown one) makes (assuming you don’t have one of those superstar contracts where they think you aren’t share partner material but don’t want you to leave and pay you like $1MM). The whole process as everyone is aware is to basically let the share partnership transfer certain costs off its books, be able to bill you out at a higher rate and somehow permit you “additional exit opportunities”. This is why you don’t have to really jump through any hoops to be a NSP. It’s in the firm’s interest to make everyone a NSP. No child left behind! All this is in exchange for a massive financial trade off than if the NSP remained an associate at Kirkland or elsewhere. When you are a NSP:

1) your health benefits aren’t covered, so you are paying the full price and if you have a family this could be an extra 1000 or more a check based on what you would pay as an associate for no additional benefit.
2) your social security and Medicare is no longer also paid by the firm, which means you’re paying double compared to if you are an associate
3) the required defined contribution amount…to the op’s point, maybe they can use the money more right now v. having an obligation to fund this
4) you pay taxes on income sourced from other states (so this can come out to 800 and more a check)
5) all of the above is in addition to paying your other state income taxes, if applicable.

The above is only manageable to swallow, again, if you’re getting some lateral starting salary that is much higher than what Kirkland pays it’s homegrown NSPs (which is basically the lockstep associate scale). So, they say, you are supposed to make up the difference in your bonus…that clearly didn’t happen this year.

So, in short, compared to if you were an associate, you’re looking at paying an additional 80K plus in taxes and additional contributions compared to if you’re an associates plus additional hours and less support in exchange for a hollow title. Moral of the story is if you are intent on being a NSP at Kirkland, lateral to Kirkland as a NSP and negotiate the hell out of your contract and sign-on bonus. Do not expect to earn on paper much higher, if at all, than an associate if you are home grown talent. And remember, even if you earn a little more on paper, you’re going to be in the red because of all the additional taxes and contributions.
My impression is that the "good" NSPs are making at least ~$100k more than counsel at comparable firms, so really the hit is to the "bad" NSPs, who likely don't have better options anyway.

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Re: Kirkland Bonuses?

Post by thisismytlsuername » Thu Dec 30, 2021 9:00 pm

Anonymous User wrote:
Thu Dec 30, 2021 8:36 pm
Anonymous User wrote:
Thu Dec 30, 2021 7:55 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:26 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
Seriously. What a cringe take with zero understanding of tax deferral. I hope that anon is litigation.
It amazes me that there is not more information out there about how little financial sense being a NSP at Kirkland (homegrown one) makes (assuming you don’t have one of those superstar contracts where they think you aren’t share partner material but don’t want you to leave and pay you like $1MM). The whole process as everyone is aware is to basically let the share partnership transfer certain costs off its books, be able to bill you out at a higher rate and somehow permit you “additional exit opportunities”. This is why you don’t have to really jump through any hoops to be a NSP. It’s in the firm’s interest to make everyone a NSP. No child left behind! All this is in exchange for a massive financial trade off than if the NSP remained an associate at Kirkland or elsewhere. When you are a NSP:

1) your health benefits aren’t covered, so you are paying the full price and if you have a family this could be an extra 1000 or more a check based on what you would pay as an associate for no additional benefit.
2) your social security and Medicare is no longer also paid by the firm, which means you’re paying double compared to if you are an associate
3) the required defined contribution amount…to the op’s point, maybe they can use the money more right now v. having an obligation to fund this
4) you pay taxes on income sourced from other states (so this can come out to 800 and more a check)
5) all of the above is in addition to paying your other state income taxes, if applicable.

The above is only manageable to swallow, again, if you’re getting some lateral starting salary that is much higher than what Kirkland pays it’s homegrown NSPs (which is basically the lockstep associate scale). So, they say, you are supposed to make up the difference in your bonus…that clearly didn’t happen this year.

So, in short, compared to if you were an associate, you’re looking at paying an additional 80K plus in taxes and additional contributions compared to if you’re an associates plus additional hours and less support in exchange for a hollow title. Moral of the story is if you are intent on being a NSP at Kirkland, lateral to Kirkland as a NSP and negotiate the hell out of your contract and sign-on bonus. Do not expect to earn on paper much higher, if at all, than an associate if you are home grown talent. And remember, even if you earn a little more on paper, you’re going to be in the red because of all the additional taxes and contributions.
1) This is definitely an extra cost compared to being an associate elsewhere and it's absolutely a real hit that people should be aware of. With the way this interacts with taxes, it's not the full hit, and they do partially subsidize junior NSPs premiums (or they used to before the raises, not sure if they've stopped doing that), but it's definitely a hit.

2) Also totally true. Again, with the way this interacts with taxes, it's not the full hit--but still, a very meaningful hit.

3) Anyone in this situation is flat-out doing it wrong. To the overwhelming majority of people, extra tax-deferred space is gold. This is a positive, not a detriment. I don't know enough about ERISA and benefit plan stuff to know whether they could allow people to "opt out" of this--possible that doesn't actually "work." That said, at least under current law, the benefit would be reduced (but not eliminated) if you're comparing it to the (still minority) of firms that permit the mega backdoor ROTH.

4/5) This somewhat overstates the hit from incremental state taxes, given the way cross-state crediting works. Unless you're in Texas or, to a somewhat lesser extent, Illinois, though if you're in one of those states you don't have the same scope of alternative options, either. Not sure what you mean on 5. Everyone has to pay home-state income tax, NSP or not.

This year's bonuses were a system shock, for sure, because the incremental bonuses over market definitely used to make up for these costs but, this year, it seems like it may not have for a lot of people. Even from this thread though, the significant majority of people were still over market--just not as over market as they used to be and, when the incremental costs associated mostly with the insurance and self-employment tax are taken into account, probably did worse than market, but I bet not by the amount implied by quoted post. Still, it's unfortunate, and I wonder whether they really thought it through for the NSPs (they legitimately may not have fully run the numbers).

That said, part of it is definitely holding out the "real partnership" carrot where you're making more at KE than other shops--which they did shorten by a year this year. More senior NSPs do seem to have pretty good landing spots even when they don't end up making partner--there's some truth to the exit options thing, though it's obviously hard to measure that against senior associates at other shops that try to lateral to partner positions elsewhere. But, no doubt, NSP at Kirkland is a different thing from senior associate at other places. Maybe higher risk higher reward kind of thinking ultimately drives it? Who knows.
Does TLS charge Kirkland's marketing/recruiting department anything to advertise here? They should.

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

Re: Kirkland Bonuses?

Post by Anonymous User » Fri Dec 31, 2021 10:34 am

Anonymous User wrote:
Thu Dec 30, 2021 8:36 pm
That said, part of it is definitely holding out the "real partnership" carrot where you're making more at KE than other shops--which they did shorten by a year this year.
To get a sense of the wealth generated as a K&E equity partner, there are five times as many equity partners at K&E as at WLRK. Without a doubt, the top 20% of partners at K&E are making more than the $7.5M averaged at Wachtell. That is, inside Kirkland there is another WLRK, only probably much more profitable. To have $6.2M PPP and 3-5 times the number of partners of anybody else in the top 10 is incredible.

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Re: Kirkland Bonuses?

Post by Anonymous User » Fri Dec 31, 2021 11:29 am

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Re: Kirkland Bonuses?

Post by Anonymous User » Fri Dec 31, 2021 2:28 pm

Anonymous User wrote:
Fri Dec 31, 2021 10:34 am
Anonymous User wrote:
Thu Dec 30, 2021 8:36 pm
That said, part of it is definitely holding out the "real partnership" carrot where you're making more at KE than other shops--which they did shorten by a year this year.
To get a sense of the wealth generated as a K&E equity partner, there are five times as many equity partners at K&E as at WLRK. Without a doubt, the top 20% of partners at K&E are making more than the $7.5M averaged at Wachtell. That is, inside Kirkland there is another WLRK, only probably much more profitable. To have $6.2M PPP and 3-5 times the number of partners of anybody else in the top 10 is incredible.
Good for them. Why were they so stingy this bonus season then? Also the proportion of lateral equity partners seems to be increasing. This is not much of a carrot considering the odds and the misery required of the homegrown few that make it.

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Re: Kirkland Bonuses?

Post by Anonymous User » Fri Dec 31, 2021 3:43 pm

Anonymous User wrote:
Fri Dec 31, 2021 2:28 pm
Anonymous User wrote:
Fri Dec 31, 2021 10:34 am
Anonymous User wrote:
Thu Dec 30, 2021 8:36 pm
That said, part of it is definitely holding out the "real partnership" carrot where you're making more at KE than other shops--which they did shorten by a year this year.
To get a sense of the wealth generated as a K&E equity partner, there are five times as many equity partners at K&E as at WLRK. Without a doubt, the top 20% of partners at K&E are making more than the $7.5M averaged at Wachtell. That is, inside Kirkland there is another WLRK, only probably much more profitable. To have $6.2M PPP and 3-5 times the number of partners of anybody else in the top 10 is incredible.
Good for them. Why were they so stingy this bonus season then? Also the proportion of lateral equity partners seems to be increasing. This is not much of a carrot considering the odds and the misery required of the homegrown few that make it.
I think you’re missing the point of one of the above posters where when you have this many partners, lateral SPs are inevitable and they actually increase the odds of homegrown SPs to inherit their book because most of these folks need 2-4 SPs to help service the book, but the data of homegrown NSPs to SPs is pretty solid and historically was shown to all NSPs at the annual meeting pre-COVID and the chances are certainly better than competitors where the partnership is generally flat or growing marginally.

The bonus in my view was a miscalculation in particular at the senior associate level where the SP promotion is still pretty far off but they’ll see people leave this spring and how they react will be the most interesting to watch, but moving SP to 9 years instead of 10 was pretty brilliant given it allowed them to potentially retain their highest margin profit centers without having to pay more. There’s inevitably going to be a stress between the WLRK-level comp contingent at Kirkland and the rest and while the moving shares a year earlier keeps some people who help generate that gap, inevitably you’re going to need to see something to address that. A higher share spread might have the effect of losing NSPs and younger SPs to more attractive offers, a discretionary black box bonus system like some other firms might help mask it for a few years, or the most profitable people just accept less money given it may be better than they can get elsewhere, but there’s definitely additional change on the horizon at some point.

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Re: Kirkland Bonuses?

Post by Anonymous User » Mon Jan 03, 2022 11:09 pm

Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
I'm the anon who made this original post that has generated so much commentary. I stand by what I originally said. Everyone I presume understands the benefits of tax deferred investment savings. But at best that argues for giving people the option to take part of their comp. in that manner rather than forcing it paternalistically onto NSPs so that, again and to be clear, your average NSP here is getting less in their bank account come bonus season than their equivalent at any other V25. Kirkland sure doesn't like to advertise that, do they? Everyone has different situations. I already have substantial savings (close to a million dollars in my 30s) in tax deferred spaces and I have substantial cash flow demands on me now and so the personal utility value of a dollar in my hand right now is much, much higher than getting another 40k x growth shoved into a 401(k) that I can't touch for two decades.

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Re: Kirkland Bonuses?

Post by Anonymous User » Mon Jan 03, 2022 11:19 pm

Anonymous User wrote:
Thu Dec 30, 2021 7:55 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:26 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
Seriously. What a cringe take with zero understanding of tax deferral. I hope that anon is litigation.
It amazes me that there is not more information out there about how little financial sense being a NSP at Kirkland (homegrown one) makes (assuming you don’t have one of those superstar contracts where they think you aren’t share partner material but don’t want you to leave and pay you like $1MM). The whole process as everyone is aware is to basically let the share partnership transfer certain costs off its books, be able to bill you out at a higher rate and somehow permit you “additional exit opportunities”. This is why you don’t have to really jump through any hoops to be a NSP. It’s in the firm’s interest to make everyone a NSP. No child left behind! All this is in exchange for a massive financial trade off than if the NSP remained an associate at Kirkland or elsewhere. When you are a NSP:

1) your health benefits aren’t covered, so you are paying the full price and if you have a family this could be an extra 1000 or more a check based on what you would pay as an associate for no additional benefit.
2) your social security and Medicare is no longer also paid by the firm, which means you’re paying double compared to if you are an associate
3) the required defined contribution amount…to the op’s point, maybe they can use the money more right now v. having an obligation to fund this
4) you pay taxes on income sourced from other states (so this can come out to 800 and more a check)
5) all of the above is in addition to paying your other state income taxes, if applicable.

The above is only manageable to swallow, again, if you’re getting some lateral starting salary that is much higher than what Kirkland pays it’s homegrown NSPs (which is basically the lockstep associate scale). So, they say, you are supposed to make up the difference in your bonus…that clearly didn’t happen this year.

So, in short, compared to if you were an associate, you’re looking at paying an additional 80K plus in taxes and additional contributions compared to if you’re an associates plus additional hours and less support in exchange for a hollow title. Moral of the story is if you are intent on being a NSP at Kirkland, lateral to Kirkland as a NSP and negotiate the hell out of your contract and sign-on bonus. Do not expect to earn on paper much higher, if at all, than an associate if you are home grown talent. And remember, even if you earn a little more on paper, you’re going to be in the red because of all the additional taxes and contributions.
This post is 100% spot on. Anyone who is an NSP here for long enough (outside of the very small cohort that knows they're pre-destined to make shares and for whom the NSP track is just a temporary holding spot) realizes after awhile that the NSP thing is a charade. Maybe it was different thirty years ago but the NSP position has become a permanent purgatory at this point--it drives profits at the firm and lets the SPs milk a group of talented attorneys to death without offering them the benefit of advancement.

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Re: Kirkland Bonuses?

Post by Anonymous User » Tue Jan 04, 2022 1:50 am

Anonymous User wrote:
Fri Dec 31, 2021 10:34 am
Anonymous User wrote:
Thu Dec 30, 2021 8:36 pm
That said, part of it is definitely holding out the "real partnership" carrot where you're making more at KE than other shops--which they did shorten by a year this year.
To get a sense of the wealth generated as a K&E equity partner, there are five times as many equity partners at K&E as at WLRK. Without a doubt, the top 20% of partners at K&E are making more than the $7.5M averaged at Wachtell. That is, inside Kirkland there is another WLRK, only probably much more profitable. To have $6.2M PPP and 3-5 times the number of partners of anybody else in the top 10 is incredible.
I don't understand this post. what does WLRK have to do with 20% of K&E partners being very rich

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Re: Kirkland Bonuses?

Post by Sackboy » Tue Jan 04, 2022 6:26 am

Anonymous User wrote:
Tue Jan 04, 2022 1:50 am
Anonymous User wrote:
Fri Dec 31, 2021 10:34 am

To get a sense of the wealth generated as a K&E equity partner, there are five times as many equity partners at K&E as at WLRK. Without a doubt, the top 20% of partners at K&E are making more than the $7.5M averaged at Wachtell. That is, inside Kirkland there is another WLRK, only probably much more profitable. To have $6.2M PPP and 3-5 times the number of partners of anybody else in the top 10 is incredible.
I don't understand this post. what does WLRK have to do with 20% of K&E partners being very rich
I think the point of OP's post is just that there are likely a group of rainmakers at KE who make a few million a year than the average WLRK partner. I'm not really sure why that's news, but OP seems to think it is news that EWYK fiend KE has a couple dozen rain makers making more than partners at the most elite corporate firm that chooses an entirely different incentive structure that specifically moves money away from rainmakers. *Surprised Pikachu*

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Re: Kirkland Bonuses?

Post by Anonymous User » Tue Jan 04, 2022 11:35 pm

Anonymous User wrote:
Mon Jan 03, 2022 11:09 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
I'm the anon who made this original post that has generated so much commentary. I stand by what I originally said. Everyone I presume understands the benefits of tax deferred investment savings. But at best that argues for giving people the option to take part of their comp. in that manner rather than forcing it paternalistically onto NSPs so that, again and to be clear, your average NSP here is getting less in their bank account come bonus season than their equivalent at any other V25. Kirkland sure doesn't like to advertise that, do they? Everyone has different situations. I already have substantial savings (close to a million dollars in my 30s) in tax deferred spaces and I have substantial cash flow demands on me now and so the personal utility value of a dollar in my hand right now is much, much higher than getting another 40k x growth shoved into a 401(k) that I can't touch for two decades.
I'm not an ERISA expert but my understanding is that a company has to require these contributions (and not make them optional) for all persons within a certain class for there to be a tax advantage.

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Re: Kirkland Bonuses?

Post by Anonymous User » Wed Jan 05, 2022 3:29 pm

Anonymous User wrote:
Tue Jan 04, 2022 11:35 pm
Anonymous User wrote:
Mon Jan 03, 2022 11:09 pm
Anonymous User wrote:
Thu Dec 30, 2021 1:11 pm
Anonymous User wrote:
Mon Dec 20, 2021 11:10 pm
It’s not a strange take at all? 130k cash in my bank account now (what I’d get at Latham or Sidley or literally any other biglaw firm) is more valuable to me than 110k cash in my bank account now (what I’d get at K&E) plus a 40k contribution into my 401k that is utterly meaningless to me until I’m 60 years old.
I often make the wrong financial choice (see, e.g., I work at Jones Day) but even I know that this is wrong.
I'm the anon who made this original post that has generated so much commentary. I stand by what I originally said. Everyone I presume understands the benefits of tax deferred investment savings. But at best that argues for giving people the option to take part of their comp. in that manner rather than forcing it paternalistically onto NSPs so that, again and to be clear, your average NSP here is getting less in their bank account come bonus season than their equivalent at any other V25. Kirkland sure doesn't like to advertise that, do they? Everyone has different situations. I already have substantial savings (close to a million dollars in my 30s) in tax deferred spaces and I have substantial cash flow demands on me now and so the personal utility value of a dollar in my hand right now is much, much higher than getting another 40k x growth shoved into a 401(k) that I can't touch for two decades.
I'm not an ERISA expert but my understanding is that a company has to require these contributions (and not make them optional) for all persons within a certain class for there to be a tax advantage.
Okay cool then can you give the Firm Committee a call and tell them to make sure next year everyone gets at least market in their bank account net of what they force into the 401k? Thanks.

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The Lsat Airbender

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Re: Kirkland Bonuses?

Post by The Lsat Airbender » Wed Jan 05, 2022 4:47 pm

you're so mad haha

like, your attitude is a much sharper indictment of K&E than the possibility that NSP is a raw deal for some people (kind of an open secret anyway)

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Re: Kirkland Bonuses?

Post by Anonymous User » Wed Jan 05, 2022 5:04 pm

Are people under the impression that at other firms you get equity at 8 years? Aside from like Cravath I think pretty much all firms do NSP these days, with equity much later if at all.

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Re: Kirkland Bonuses?

Post by Anonymous User » Wed Jan 05, 2022 5:12 pm

The Lsat Airbender wrote:
Wed Jan 05, 2022 4:47 pm
you're so mad haha

like, your attitude is a much sharper indictment of K&E than the possibility that NSP is a raw deal for some people (kind of an open secret anyway)
so many people @ TLS are weirdly eager to jump down people's throats in K&E threads and it's bizarre. It's a "sharper indictment?" Are you serious right now lol The point is to encourage open discussion about comp. here vs. the industry when the firm tries to keep it black box from everyone. Most KE associates don't even understand what's up which is why the 6th year to NSP "promotion" is such a shock. I personally didn't understand how this part of end of year comp would happen--they breeze over this part in like 30 seconds during the overview presentation at least for my year where they spent most of their time talking about the CRM system lol

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Re: Kirkland Bonuses?

Post by The Lsat Airbender » Wed Jan 05, 2022 5:49 pm

Anonymous User wrote:
Wed Jan 05, 2022 5:12 pm
so many people @ TLS are weirdly eager to jump down people's throats in K&E threads and it's bizarre. It's a "sharper indictment?" Are you serious right now lol The point is to encourage open discussion about comp. here vs. the industry when the firm tries to keep it black box from everyone. Most KE associates don't even understand what's up which is why the 6th year to NSP "promotion" is such a shock. I personally didn't understand how this part of end of year comp would happen--they breeze over this part in like 30 seconds during the overview presentation at least for my year where they spent most of their time talking about the CRM system lol
It probably doesn't get much attention from your classmates or firm management because tax-deferred compensation is a positive thing for most people in the 37% tax bracket. As in, if you held a referendum among NSPs, they would most likely vote to preserve the status quo and get $40k in their 401(k) rather than $40k of taxable bonus. It's not something the dastardly equity partnership have foisted upon you; it's a perfectly-reasonable policy that happens to ever-so-slightly disadvantage a minority of NSPs with unusual financial priorities.

FYI, if you're legitimately suffering under the yoke of maxed 401(k) contributions, you can take a loan up to $50k (which actually makes you more liquid in the year you do it because it's pre-tax money). You can also initiate a SEPP once you leave the firm. So this is an even smaller problem than we're pretending it is arguendo.

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Sackboy

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Re: Kirkland Bonuses?

Post by Sackboy » Thu Jan 06, 2022 5:40 am

Anonymous User wrote:
Wed Jan 05, 2022 5:04 pm
Are people under the impression that at other firms you get equity at 8 years? Aside from like Cravath I think pretty much all firms do NSP these days, with equity much later if at all.
I'd say 10-12 years is a pretty typical path these days. 8 years as an associate 2-4 years as a counsel and then equity.

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Re: Kirkland Bonuses?

Post by Anonymous User » Thu Jan 06, 2022 11:25 am

The firm had a down year. People are being too harsh on K&E.


https://news.bloomberglaw.com/business- ... -law-firms

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Re: Kirkland Bonuses?

Post by Anonymous User » Fri Jan 07, 2022 1:12 pm

Anonymous User wrote:
Thu Jan 06, 2022 11:25 am
The firm had a down year. People are being too harsh on K&E.


https://news.bloomberglaw.com/business- ... -law-firms
they seriously need to raise bonuses, 1.1-1.3x is a joke.

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unlicensedpotato

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Re: Kirkland Bonuses?

Post by unlicensedpotato » Fri Jan 07, 2022 4:16 pm

Anonymous User wrote:
Fri Jan 07, 2022 1:12 pm
Anonymous User wrote:
Thu Jan 06, 2022 11:25 am
The firm had a down year. People are being too harsh on K&E.


https://news.bloomberglaw.com/business- ... -law-firms
they seriously need to raise bonuses, 1.1-1.3x is a joke.
lol only took them 9x the deals and probably at least 10x the lawyers to pass WLRK

Seriously? What are you waiting for?

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