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Speculate.

At no cut firms, associates are going to be paying, at least partially, for the relatively quieter partner draw decreases/delays.

At firms that have already cut, yeah things will be less than ideal come bonus time.

this is so breathtakingly obvious that I can’t believe it needs to be said out loud

there will be either no bonuses or nominal bonuses (eg 5-15k)

I’d be thrilled with 50% bonus (at a firm that hasn’t made cuts and indicated that it has “no plans” to do so - which, of course, I’m taking with a grain of salt).

But I also expect that bonuses will be zero or nominal.

wwwcol wrote:this is so breathtakingly obvious that I can’t believe it needs to be said out loud

there will be either no bonuses or nominal bonuses (eg 5-15k)

V30 firms will not have lower bonuses.

At certain firms, this is where hours thresholds work their magic. Some will get market bonuses, some will get diddly.

Ultramar vistas wrote:

wwwcol wrote:this is so breathtakingly obvious that I can’t believe it needs to be said out loud

there will be either no bonuses or nominal bonuses (eg 5-15k)

V30 firms will not have lower bonuses.

Biglaw firms, even the V10, gave out nominal bonuses starting in 2008, and didn't raise them for years despite the legal market quickly recovering. Why would this year be any different? I get that some firms might want to demonstrate strength but they'll do that by not laying off/announcing salary cuts.

VulcanVulcanVulcan wrote:

Ultramar vistas wrote:

wwwcol wrote:this is so breathtakingly obvious that I can’t believe it needs to be said out loud

there will be either no bonuses or nominal bonuses (eg 5-15k)

V30 firms will not have lower bonuses.

Biglaw firms, even the V10, gave out nominal bonuses starting in 2008, and didn't raise them for years despite the legal market quickly recovering. Why would this year be any different? I get that some firms might want to demonstrate strength but they'll do that by not laying off/announcing salary cuts.

Yeah, we already have a roadmap for a recession. People should expect low/nominal bonuses from biglaw firms. The exceptions are for the true top like Wachtell, although even they reduced bonuses (even if they were still large). The generic V10, let alone V30, does not qualify.

I think the no cut firms will need to continue to assert some dominance over cut firms come bonus time to make it worth the PR investment. I think firms that cut will have nominal to no bonuses. I think lower level no cut firms (e.g., Morgan Lewis, DLA piper US) will do like half market bonuses or I dunno maybe a little more, and I think you’ll see like Latham etc stick with market. Maybe you’ll see Kirkland or quinn do something crazy over the top who knows.

Our firm said at the outset that they were lowering the hours requirement for bonus this year, but were suspiciously quiet on whether bonuses would be the same. I would expect it to be lower with a close to full bonus for top billers. Most people I know are still on track to make hours so it would be extra crappy to have a lower bonus. Biglaw corporate.

Anonymous User wrote:Our firm said at the outset that they were lowering the hours requirement for bonus this year, but were suspiciously quiet on whether bonuses would be the same. I would expect it to be lower with a close to full bonus for top billers. Most people I know are still on track to make hours so it would be extra crappy to have a lower bonus. Biglaw corporate.

My firm has also been quiet on bonuses but I also don't think anyone has had the guts to ask. Your take is overly optimistic, for several reasons: (1) biglaw firms don't like paying bonuses and only do so, by grudgingly following Cravath, in order to compete for law students and to retain associates, (2) the economy is obviously not great and it's not going to immediately snap back, so there is a good pretext to lower bonuses, and (3) law firms can't possibly know what the bonuses will be in April. The bonuses will be whatever Cravath says they are, unless some other V10 goes over the top and everyone matches.

objctnyrhnr wrote:I think the no cut firms will need to continue to assert some dominance over cut firms come bonus time to make it worth the PR investment. I think firms that cut will have nominal to no bonuses. I think lower level no cut firms (e.g., Morgan Lewis, DLA piper US) will do like half market bonuses or I dunno maybe a little more, and I think you’ll see like Latham etc stick with market. Maybe you’ll see Kirkland or quinn do something crazy over the top who knows.

Yeah I just don’t see firms like Kirkland, Quinn, or Weil giving out lower bonuses. I think bonuses will stay roughly the same as last year. Certain firms will not feel a significant financial hit from this downturn and may take this opportunity to truly separate themselves from the pack. The move to 190K didn’t do it because everyone else followed, this is the chance to demonstrate financial stability.

Of course, there is a chance that these greedy fucks screw us on bonuses, but I guess I’m hoping that it’s not the case here.

Cravath bonuses in 2009 topped out at $30,000 for senior associates. https://abovethelaw.com/2009/11/breakin ... -and-down/

By contrast, in 2007, the bonus for 1st-year associates was $35k plus a $10k "special" bonus, and $60k + $50k special for senior associates. https://blogs.wsj.com/law/2007/10/29/cr ... son-begin/

I'd expect to see V20 bonuses range from $10k-50k; maybe 2-3 firms with strong years will continue to pay 2019-level bonuses.

What do you think will they do about rx associates who bill a ton this year?

Anonymous User wrote:What do you think will they do about rx associates who bill a ton this year?

No one knows, though I suspect some firms will want to reward top billers. FWIW in 2009 Weil paid up to $50k in additional "distinguished" bonuses on top of the regular bonuses. https://abovethelaw.com/2009/12/associa ... k-bonuses/

My V10 firm has already telegraphed to us to expect reduced bonuses at the end of this year.

Expect same bonuses for exceptional billers (some people are busier than ever at my firm), half bonuses under a certain threshold.

Anonymous User wrote:My V10 firm has already telegraphed to us to expect reduced bonuses at the end of this year.

Which one? My V10 is just as busy (and busier in several groups) than before the pandemic and we've been told that our performance is stronger than this point last year. Not Kirkland or Weil. If they reduce our bonuses, I don't think it'll be because we made any less money. Likely because why pay more than they have to if rest of market is down?

My V10 office billed more in March than in February and April is still buzzing right along. I think there’s a decent chance that bonuses go down everywhere, but there isn’t a single “market” bonus across the V50-100 or whoever usually participates in it. Our cuts might be lesser.

Sounds like a great opportunity for Milbank to show some leadership and establish itself as the market leader.

Anonymous User wrote:My V10 office billed more in March than in February and April is still buzzing right along.

Same here.

Anonymous User wrote:

Anonymous User wrote:My V10 firm has already telegraphed to us to expect reduced bonuses at the end of this year.

Which one? My V10 is just as busy (and busier in several groups) than before the pandemic and we've been told that our performance is stronger than this point last year. Not Kirkland or Weil. If they reduce our bonuses, I don't think it'll be because we made any less money. Likely because why pay more than they have to if rest of market is down?

I have to admit I am confused by how associates view bonuses. They are set by external market factors (Cravath), similar to how salaries are set. Another firm having a very hot year or a very cold year doesn't top Cravath unless you are Kirkland or maybe a couple others. Firms had great years in 2012, etc. comparable to 2006-2007 but bonuses were still down by 50% or more because Cravath and other market leaders did not want to pay more. That's it.

Everyone else just follows irrespective of firm performance. At my firm, we follow Cravath because that is the prevailing market rate and they need to retain associates, not due to any sort of internal calculation of the firm's revenue for the year.

It's complicated. Yes, there are market forces at play. But, it's also hard for a firm to justify significant reductions in bonuses if its financials were similar (or better) than the previous year. Especially for associates that end up working more than normal due to the circumstances. Bonuses are a huge part of associate morale and firms can't be oblivious to that. That does not mean well-performing firms won't use the market as an excuse to reduce bonuses, but I just don't think its that clear cut. Obviously uncharted waters somewhat, but if I was to bet on anything, it would be bonuses to be highly variable this year between firms, and possibly within firms.

ghostoftraynor wrote:It's complicated. Yes, there are market forces at play. But, it's also hard for a firm to justify significant reductions in bonuses if its financials were similar (or better) than the previous year. Especially for associates that end up working more than normal due to the circumstances. Bonuses are a huge part of associate morale and firms can't be oblivious to that. That does not mean well-performing firms won't use the market as an excuse to reduce bonuses, but I just don't think its that clear cut. Obviously uncharted waters somewhat, but if I was to bet on anything, it would be bonuses to be highly variable this year between firms, and possibly within firms.

Agreed. Associate retention still matters. Hopefully Cravath and Milbank still understand that screwing associates on bonuses will have long-term impacts.

PMan99 wrote:

VulcanVulcanVulcan wrote:

Ultramar vistas wrote:

wwwcol wrote:this is so breathtakingly obvious that I can’t believe it needs to be said out loud

there will be either no bonuses or nominal bonuses (eg 5-15k)

V30 firms will not have lower bonuses.

Biglaw firms, even the V10, gave out nominal bonuses starting in 2008, and didn't raise them for years despite the legal market quickly recovering. Why would this year be any different? I get that some firms might want to demonstrate strength but they'll do that by not laying off/announcing salary cuts.

Yeah, we already have a roadmap for a recession. People should expect low/nominal bonuses from biglaw firms. The exceptions are for the true top like Wachtell, although even they reduced bonuses (even if they were still large). The generic V10, let alone V30, does not qualify.

Maybe im being optimistic, and I don't want to start a debate about the virus, but I don't think firms see the current situation as analogous to the financial crisis