Change my mind: Layoffs and no-offers should happen in biglaw

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bluedolphin

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by bluedolphin » Fri May 22, 2020 2:17 pm

beepboopbeep wrote:
Fri May 22, 2020 1:50 pm
Put this on the other shoe: why should students not coordinate to blackball non-100% offer firms? They apparently have the power to do so, since they do. And they gain an obvious benefit from 100% offer being the norm. What benefit would students gain from abandoning that norm?

If the argument is firms should just ignore it, well, lol. Some do. You can see how it works out for them.
If they start no-offering and they change their comp model, where people can significantly outperform market, it could work. Most students I would assume wouldn't turn down a Wachtell if Wachtell dropped its offer rates down to 85%. Theres a reason people do Mckinsey/Credit Suisse summers instead of biglaw summers.

Kirkland moving to a base + bonus model with communicated targets that get the average performer to 10-20% higher than market, and the high performer to 30-40% higher than market, maybe could work. Something like 150k base + 60k bonus target with flexiblity to go up to 120k on bonus for first years.

No-offering also shouldn't be as big of an issue for students as well. I know from my end, and doing biglaw, don't have the personality to rip through a thousand data room contracts.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by texanslimjim » Fri May 22, 2020 2:27 pm

OP, have you stopped to consider that maybe the salary and expectations for employment at elite big law firms exist because of market conditions?

Many big law firms do exactly what you are saying: they offer lower, more variable compensation; they are less reliable to their summers; they view their associates as expendable in a downturn. Budget big law is a thing and it's not even a small niche in the market; it's pretty sizable. The question you should ask isn't "why shouldn't law firms do that," but "why don't all the top law firms do that?"

The answer is because firms are competing for top talent, and they must have all come to the conclusion that the top talent is worth the price. And the top talent wants a secure job with a high base salary with little variability, because the top talent likely has heavy debt and and knows that their career is vulnerable if they don't get started off on the right foot.

Other firms want the same top talent, but can't compete on price. There's no ethical problem with a firm that does not match the Cravath scale or 100% offer their summers or reliably keep most associates for at least 4-5 years. The problem is when a firm holds itself out as a Cravath-scale style elite big law firm in its employment practices but acts clandestinely like a budget big law firm. Essentially, these firms are trying to cheat at getting elite talent without paying the market price.

It's very easy to cheat on the "norms" part of that market price -- high offer rate for summers, stable job for young associate -- because no one is signing a contract. The only penalty they pay is reputational. And that's what is happening when summers and associates complain about getting screwed: they are exacting that reputational price. Telling those summers and associates that they are being entitled and should shut up is dumb.

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beepboopbeep

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by beepboopbeep » Fri May 22, 2020 2:33 pm

Yea, texanslimjim responded better than I would have to the last couple posts.

It's worth noting there are a few other firms that do something like the model you're advocating for, at least within litigation. They exist for associates if someone wants that kind of risk/reward. Susman comes to mind. It's worth considering why that model hasn't spread like wildfire if it's either (a) much better or (b) replicable across the class of incoming associates each year. The answer is probably something like
texanslimjim wrote:
Fri May 22, 2020 2:27 pm
because firms are competing for top talent, and they must have all come to the conclusion that the top talent is worth the price. And the top talent wants a secure job with a high base salary with little variability, because the top talent likely has heavy debt and and knows that their career is vulnerable if they don't get started off on the right foot.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by Excellent117 » Fri May 22, 2020 2:34 pm

Biglaw associates are being highly compensated to be available at the drop of a hat 24/7/365, not to live in ever-present fear of layoffs.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by kovdak02 » Fri May 22, 2020 2:36 pm

What is the argument? "Biglaw should lower associate salaries" is not an argument. There are allusions to "There will be more job security for associates if salaries were lower" and "Associates would rather work for higher potential pay and lower guaranteed pay," but these are backed up by nothing. And market conditions suggest both of them are just untrue.

To the first, firms are cutting associate salaries right now to save their jobs. This is happening due to economic conditions. If the economy was whirring along at a February 2020 clip, no firm would keep talent by cutting salaries.

To the second, aren't there P-side firms that offer this? What has stopped a biglaw firm from doing this? And what evidence is there that the top of T14 2L classes would take an offer at a "120 + possibility of 120" firm over a "190 + 10 no matter what" one?

The ultimate grievance seems to be "These associates in their 20s and early 30s have it too good, and they just should get less." Too bad. The market decides. I think associates benefit greatly from a secondary effect of the conflicts/ethics rules: there are still dozens of elite law firms that otherwise would have consolidated into just a few. This competition is fierce and ultimately means associates earn more. Milbank pushing salaries is a strong example of this.

Associates are compensated very well. (It's odd to me that you compare their salaries against support staff rather than focusing on partner comp, though.) Any biglaw firm is welcome to slash salaries for any of the reasons you offer and promise that the top 20 or 30% of every class will beat market compensation. There is a reason why none of them have done so.

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bluedolphin

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by bluedolphin » Fri May 22, 2020 3:03 pm

texanslimjim wrote:
Fri May 22, 2020 2:27 pm
OP, have you stopped to consider that maybe the salary and expectations for employment at elite big law firms exist because of market conditions?

Many big law firms do exactly what you are saying: they offer lower, more variable compensation; they are less reliable to their summers; they view their associates as expendable in a downturn. Budget big law is a thing and it's not even a small niche in the market; it's pretty sizable. The question you should ask isn't "why shouldn't law firms do that," but "why don't all the top law firms do that?"

The answer is because firms are competing for top talent, and they must have all come to the conclusion that the top talent is worth the price. And the top talent wants a secure job with a high base salary with little variability, because the top talent likely has heavy debt and and knows that their career is vulnerable if they don't get started off on the right foot.

Other firms want the same top talent, but can't compete on price. There's no ethical problem with a firm that does not match the Cravath scale or 100% offer their summers or reliably keep most associates for at least 4-5 years. The problem is when a firm holds itself out as a Cravath-scale style elite big law firm in its employment practices but acts clandestinely like a budget big law firm. Essentially, these firms are trying to cheat at getting elite talent without paying the market price.

It's very easy to cheat on the "norms" part of that market price -- high offer rate for summers, stable job for young associate -- because no one is signing a contract. The only penalty they pay is reputational. And that's what is happening when summers and associates complain about getting screwed: they are exacting that reputational price. Telling those summers and associates that they are being entitled and should shut up is dumb.
I am not talking about lower variable compensation though. I think alot of my counterparts at firms should actually be paid significantly higher than what they make now. They run IBD associate hours but make anywhere from 20-30% less depending on bank, and the work isn't harder at IBD. ROI is there if that provides incentives for the average collectables to go up by 50 or so hours.

My issue with the 100% offer, no layoffs, is that there is usually some sort of drag, the associate that got horrible summer reviews that had the firm had to offer, or people who coast on 70% of average billables. Banks can deal with this, by bucketing their bonuses, but firms have a harder time. Top performers get PAID, average performers do slightly better than historically, weaker performers are paid less.

I am more in favor of lowering salary and increasing the average bonus by a larger amount than the decrease in salary tied to hours + performance. This isn't a model that has been tried at any reputable transaction based firms other than maybe Kirkland who has had some related success in recruiting with above market bonuses, and significant success on the client side. I guess Wachtell as well but that is not a good comp since I understand they have always been significantly above market.

If a good corporate firm switched to this model, I could definitely see them getting a very strong crop of associates who want to put their heads down and grind. Also I'll be clear I'm not advocating for practice group layoffs but more performance driven (which are usually the case; its not like the top bucket associates were laid off from Latham).

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by L'orDuCommun » Fri May 22, 2020 3:09 pm

Also, fun fact, the 160K that first years made back in 2007 is worth about 198K in today's dollars. So, in real terms, associates salaries have actually decreased since 2007.

By contrast, taking Cravath as an example, PPP in 2007 was 3,075,000, or about 3,800,000 in today's dollars. Cravath PPP in 2019 was 4,414,000, so it's increased by about 16% in real terms.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by bluedolphin » Fri May 22, 2020 3:12 pm

kovdak02 wrote:
Fri May 22, 2020 2:36 pm
What is the argument? "Biglaw should lower associate salaries" is not an argument. There are allusions to "There will be more job security for associates if salaries were lower" and "Associates would rather work for higher potential pay and lower guaranteed pay," but these are backed up by nothing. And market conditions suggest both of them are just untrue.

To the first, firms are cutting associate salaries right now to save their jobs. This is happening due to economic conditions. If the economy was whirring along at a February 2020 clip, no firm would keep talent by cutting salaries.

To the second, aren't there P-side firms that offer this? What has stopped a biglaw firm from doing this? And what evidence is there that the top of T14 2L classes would take an offer at a "120 + possibility of 120" firm over a "190 + 10 no matter what" one?

The ultimate grievance seems to be "These associates in their 20s and early 30s have it too good, and they just should get less." Too bad. The market decides. I think associates benefit greatly from a secondary effect of the conflicts/ethics rules: there are still dozens of elite law firms that otherwise would have consolidated into just a few. This competition is fierce and ultimately means associates earn more. Milbank pushing salaries is a strong example of this.

Associates are compensated very well. (It's odd to me that you compare their salaries against support staff rather than focusing on partner comp, though.) Any biglaw firm is welcome to slash salaries for any of the reasons you offer and promise that the top 20 or 30% of every class will beat market compensation. There is a reason why none of them have done so.
Again I'm not advocating for less total comp for associates, I am advocating for higher total associate comp, re-allocated by performance. Firms are in the salary stratosphere that job security shouldn't be guaranteed.

The grievance isn't that associates in their 20s and 30s have it too good and should get less, the grievance is that people in their 20s and 30s have it good but should stop complaining about inherent parts of their job that their high guaranteed compensation is tied to.

People who perform should get more, people who coast/should have been no offered/people hate working with, shouldn't be getting the same or 5% less because they didn't get the 10k part of the bonus.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by PMan99 » Fri May 22, 2020 3:17 pm

People who perform should get more, people who coast/should have been no offered/people hate working with, shouldn't be getting the same or 5% less because they didn't get the 10k part of the bonus.
The latter group of people get fired at most firms (along with others who don't hit their metrics for whatever reason). The entire thread is premised on the idea that shitty associates are floating around for a while causing a serious drag on the firm, which isn't true. Maybe for first or second years, but after that firms tend to be pretty cutthroat. You don't get 5 partners from a 100 person associate class through voluntary attrition alone.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by JusticeSquee » Fri May 22, 2020 3:20 pm

I don't see the connection between the Kirkland email and the OP - OP is talking about who should bear the risk when work dries up, employees or owners (it is always ends up being the employees). The Kirkland email isn't about work drying up, it seems to be about partners having trouble getting associates to work on projects even though everyone's utilization is shit.

I agree with Kirkland but not necessarily OP.

If your hours are shit right now, you better not be ducking work - if you get a call to work on something, the answer should be thank you sir, can I have another - this goes for downturns and upturns in the economy.

If your hours are shit and you can't get work because the firm doesn't have any, it is understandable for associates to expect the firm to be a little forgiving.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by hdr » Fri May 22, 2020 3:29 pm

PMan99 wrote:
Fri May 22, 2020 3:17 pm
People who perform should get more, people who coast/should have been no offered/people hate working with, shouldn't be getting the same or 5% less because they didn't get the 10k part of the bonus.
The latter group of people get fired at most firms (along with others who don't hit their metrics for whatever reason). The entire thread is premised on the idea that shitty associates are floating around for a while causing a serious drag on the firm, which isn't true. Maybe for first or second years, but after that firms tend to be pretty cutthroat. You don't get 5 partners from a 100 person associate class through voluntary attrition alone.
That hasn't been true in my experience. When things are busy it's not hard for shitty associates to hit 1600-1700 hours doing menial work, which is usually all it takes to survive another year. I know multiple 6th-7th year associates who have never gotten a bonus yet are now making $300k or whatever. They're doing things the right way, IMO.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by texanslimjim » Fri May 22, 2020 3:35 pm

bluedolphin wrote:
Fri May 22, 2020 3:03 pm
I am not talking about lower variable compensation though. I think alot of my counterparts at firms should actually be paid significantly higher than what they make now. They run IBD associate hours but make anywhere from 20-30% less depending on bank, and the work isn't harder at IBD. ROI is there if that provides incentives for the average collectables to go up by 50 or so hours.

My issue with the 100% offer, no layoffs, is that there is usually some sort of drag, the associate that got horrible summer reviews that had the firm had to offer, or people who coast on 70% of average billables. Banks can deal with this, by bucketing their bonuses, but firms have a harder time. Top performers get PAID, average performers do slightly better than historically, weaker performers are paid less.

I am more in favor of lowering salary and increasing the average bonus by a larger amount than the decrease in salary tied to hours + performance. This isn't a model that has been tried at any reputable transaction based firms other than maybe Kirkland who has had some related success in recruiting with above market bonuses, and significant success on the client side. I guess Wachtell as well but that is not a good comp since I understand they have always been significantly above market.

If a good corporate firm switched to this model, I could definitely see them getting a very strong crop of associates who want to put their heads down and grind. Also I'll be clear I'm not advocating for practice group layoffs but more performance driven (which are usually the case; its not like the top bucket associates were laid off from Latham).
There are certainly firms that have tried to attract talent by offering lower base salaries and offering large bonuses on an "eat what you kill" model and the like. They just typically aren't attractive for the elite talent. Elite transactional firms don't do this because they want their elite talent.

Elite law graduates generally want the guaranteed high salary. This makes sense; even if you've done well in law school, there's no guarantee you are going to like or succeed in your big law practice. There's not actually any guarantee what kind of hours or work you will have. Compared to law school, much less is under your control. There's just too many unknowns for it to be wise to take a lower salary with higher potential bonus instead of a high fixed salary. And big law offers plenty of other upside for super-achievers, the big one being partnership.

Law firms pay this price knowing full well that some of their associates will be overachievers and some will be underachievers, and that it's hard sort out who's who until after a few years. And even the most mediocre associates usually make money for their firms as long as there's a bare minimum of work to be done.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by bluedolphin » Fri May 22, 2020 3:40 pm

JusticeSquee wrote:
Fri May 22, 2020 3:20 pm
I don't see the connection between the Kirkland email and the OP - OP is talking about who should bear the risk when work dries up, employees or owners (it is always ends up being the employees). The Kirkland email isn't about work drying up, it seems to be about partners having trouble getting associates to work on projects even though everyone's utilization is shit.

I agree with Kirkland but not necessarily OP.

If your hours are shit right now, you better not be ducking work - if you get a call to work on something, the answer should be thank you sir, can I have another - this goes for downturns and upturns in the economy.

If your hours are shit and you can't get work because the firm doesn't have any, it is understandable for associates to expect the firm to be a little forgiving.
I view the underlying motivation as being one and the same. There is a lot less people sticking their hands up, just trying to collect checks (noted that some people have significant home life obligations during these times.) And yet those same people who are slow in that office will blast Kirkland if they do get laid off due to Kirkland being slow in Oil & Gas M&A.

The people who are being staffed/sticking their hands up, aren't the ones who get laid off in the Houston office if layoffs were too happen. Layoffs always have some sort of performance component to them unless there is an axing of an entire practice group/office.

No harm no foul if you get paid a normal wage, and staff should never be laid off here. But at biglaw comp levels, I just see alot of entitlement.

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galba

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by galba » Fri May 22, 2020 3:45 pm

From a client perspective, seems eminently reasonable to express a preference for a comp structure that rewards good performers and penalizes bad more than the current system. Likewise it seems eminently reasonable that risk-averse lawyers might prefer a comp structure with less variability. Think OP's framing of "should" really misses the point here.

(I do find it amusing that some people in this thread shitting on OP are the same that frequently advocate that associates coast for as long as they can in biglaw until asked to leave. Absolutely nothing wrong with doing that, none of us "owe" anything to our employers, but why would clients want to pay for the work of those people?)

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by kovdak02 » Fri May 22, 2020 3:56 pm

What clients are refusing to hire V20 firms because they have some 3rd and 4th years who are doing mediocre work just to survive to the next January? That doesn’t seem like a problem that actually exists in need of a solution.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by Anonymous User » Fri May 22, 2020 4:39 pm

kovdak02 wrote:
Fri May 22, 2020 3:56 pm
What clients are refusing to hire V20 firms because they have some 3rd and 4th years who are doing mediocre work just to survive to the next January? That doesn’t seem like a problem that actually exists in need of a solution.
Not sure how or why that's relevant, particularly given the relatively limited universe of firms that can reasonably serve large corporate clients. Clients would surely prefer a world in which that "slack" in the system didn't exist, and it's not unexpected that they'd argue for comp systems that would disincentivize it. It's a little disingenuous to on the one hand argue that associates should try to bleed off a few months or even years of high comp for little work, and then act shocked and appalled that clients (who ultimately pay for this) would like things to be different.

Again, associates aren't doing anything wrong here! Don't owe firms anything and should take what we can get. But like... other actors in this game obviously have the same motivations and incentives, and that's not at all surprising or "wrong."

edit: accidental anon, this is galba

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by ghostoftraynor » Fri May 22, 2020 4:46 pm

hdr wrote:
Fri May 22, 2020 3:29 pm
PMan99 wrote:
Fri May 22, 2020 3:17 pm
People who perform should get more, people who coast/should have been no offered/people hate working with, shouldn't be getting the same or 5% less because they didn't get the 10k part of the bonus.
The latter group of people get fired at most firms (along with others who don't hit their metrics for whatever reason). The entire thread is premised on the idea that shitty associates are floating around for a while causing a serious drag on the firm, which isn't true. Maybe for first or second years, but after that firms tend to be pretty cutthroat. You don't get 5 partners from a 100 person associate class through voluntary attrition alone.
That hasn't been true in my experience. When things are busy it's not hard for shitty associates to hit 1600-1700 hours doing menial work, which is usually all it takes to survive another year. I know multiple 6th-7th year associates who have never gotten a bonus yet are now making $300k or whatever. They're doing things the right way, IMO.
It's very firm/practice group dependent. In my group, people get axed every year, and not just people with obvious performance issues.

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Lesion of Doom

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by Lesion of Doom » Fri May 22, 2020 4:55 pm

bluedolphin wrote:
Fri May 22, 2020 3:40 pm


The people who are being staffed/sticking their hands up, aren't the ones who get laid off in the Houston office if layoffs were too happen. Layoffs always have some sort of performance component to them unless there is an axing of an entire practice group/office.

No harm no foul if you get paid a normal wage, and staff should never be laid off here. But at biglaw comp levels, I just see alot of entitlement.
Bolded is where your argument falls apart. The same associate could get wildly divergent reviews depending upon firm, group, specific partner, midlevel or senior supervisor, economy and other factors. Law students generally understand this reality and rely on uniform compensation and advancement to defuse the risk of a bad situation.

First years, especially, frequently have little control over their hours. I don't think anyone would argue that someone who refuses to work should be protected. But once you understand how arbitrary "performance" can be, it's obvious why top students demand the present format.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by texanslimjim » Fri May 22, 2020 5:19 pm

Anonymous User wrote:
Fri May 22, 2020 4:39 pm
kovdak02 wrote:
Fri May 22, 2020 3:56 pm
What clients are refusing to hire V20 firms because they have some 3rd and 4th years who are doing mediocre work just to survive to the next January? That doesn’t seem like a problem that actually exists in need of a solution.
Not sure how or why that's relevant, particularly given the relatively limited universe of firms that can reasonably serve large corporate clients. Clients would surely prefer a world in which that "slack" in the system didn't exist, and it's not unexpected that they'd argue for comp systems that would disincentivize it. It's a little disingenuous to on the one hand argue that associates should try to bleed off a few months or even years of high comp for little work, and then act shocked and appalled that clients (who ultimately pay for this) would like things to be different.

It's really a gross oversimplification of how these firms work to say clients are "paying for" below-average associates to be paid the same as above-average ones. Sophisticated clients will understand that white shoe firms try to get the highest average quality of associate possible, and their comp structure serves that. An incentives-based comp structure for associates is counterproductive if your lose more in the quality of candidates you attract than you gain in motivating them. And it averages out anyway, because you're getting above-average associates at a discount that mirrors the "cost" of the below-average.

Those bearing the "slack" are the firm and the above-average associates. The firm is willing to accept that some associates will be less profitable than others, because what matters is overall profitability. The cost of trying to weed out or motivate slackers early is probably greater than just accepting them. The other associates are willing to accept it because that's the deal they signed up for -- and once they get a few years experience they'll be much better positioned to switch to a high-risk, high-reward situation if that's what they want for their career.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by Monochromatic Oeuvre » Fri May 22, 2020 5:35 pm

bluedolphin wrote:
Fri May 22, 2020 1:38 pm
Monochromatic Oeuvre wrote:
Fri May 22, 2020 1:08 pm
What's your actual thesis here, bootlicker? Do you think you're the first person to suggest that Biglaw could treat its employees worse and still have a waiting list? I'm guessing the same is true of your job. No-offers wreck someone's chance of ever getting back into Biglaw. Layoffs are not quite as deleterious but, when they happen at a junior level, indebted associates often can't afford them. Why are you arguing for them? Partners feeling a little inadequate at the yacht auction this year?

Firms can conduct business how they want, but people who aren't sociopaths think millionaires should bear financial burdens before people who make 10-50x less than they do, and this board (and the rest of the Internet) takes, and should take, every opportunity to call out the ones treating employees like shit and tell other people not to go there and be treated like shit.

I've heard an onslaught of in-house bitching in my time, and yet you dickcheeses keep paying these ridiculous rates. Why don't you convince your bosses to stop using Biglaw and instead hiring Shingle and Yokel LLP for your needs? Most of my colleagues have been drowning in work their entire careers and would love to have one of their pain-in-the-ass clients off their plate. So why don't you come on here and tell us when you've given your "biglaw firm hiring/firing recommendations to investment leaders," and I'll come here and tell you to get fucked with a rake every time you do?
I actually agree with most of your points, I just don't think biglaw associates are in the place compensation wise to class yourself in with the rest of the people who make these arguments. Most biglaw associates, unless you went to school late are in the top 1-2% of their age bracket for income. How much more do you make than the janitorial staff at your office 6x, 7x? The legal assistants 3x?

Biglaw comp is high enough now, where it is the type of job that shouldn't have pure job security. Layoffs really suck, and really shouldn't happen to first years since they haven't had a chance to prove themselves, but beyond that inherent risk is part of the compensation biglaw associates earn. Earning 200k or whatever the comp number for first year isn't a right, its something that is earned.

I actually think alot of the associates I work with alot are underpaid, they make sacrifices on a personal level, where its likely they hit 2500 billables in a year, but full lockstep just fucks them. Maybe their comp that year was 220, it should be closer to 300.

Theres a reason why I noted that if you are laying off support staff first, thats shit. They are in the compensaiton position where they should have a secure job.
You're just all over the place, dude.

I don't get to complain because I make more than the support staff? FWIW, I think good support staff should make more anyway. I certainly wouldn't advocate they get fired more often. But when it comes to the partners making 20x what I make, or the multibillion dollar client, suddenly the right to complain is back on the table?

You're positing a bunch of questions that have obvious management answers. Why doesn't Cravath pay more than Dechert? Because it doesn't have to in order to differentiate itself among good talent (DRIPPING with preftige). Why don't good associates make more, and why aren't bad associates shitcanned at a higher rate? Because associates in a given class year bill out at the same rate and your company doesn't demand to differentiate when it pays the bills or refuse to pay for the shitty lawyers. Why don't associates who bill 2200+ make more? Because they're not decamping for places with lower hours expectations at particularly unique rates. Why isn't the 20% associate turnover a year--which, by the way, would be considered outrageously high in almost any other industry--even higher? Because, as you danced around but never bullseyed, it's really expensive to recruit, provide for, and train associates for several years until they're good, and clients aren't willing to pay more than they do to make it happen.

It's a bit ironic that you spend all this breath on how the Biglaw model is broken and then talking about how your company hires Latham and Kirkland and all of the people who would have the power to change all of these things if they really gave a shit. The strong do what they will and the weak suffer what they must. The in-house criticism is always so pointless because it almost always comes from the same people who constantly fail to hire laterals due to giant pay cut demands, and who for the same work year after year with consistent 6% rate increases. Why would I listen to an exhortation for change from the people who are largely responsible for keeping this industry the same year after exhausting year?

12YrsAnAssociate

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by 12YrsAnAssociate » Fri May 22, 2020 6:10 pm

Monochromatic Oeuvre wrote:
Fri May 22, 2020 5:35 pm

You're just all over the place, dude.
I think this is the most accurate statement in this entire thread.

I guess the thesis has morphed into firms could pay more if they no-offered and laid people off. The answer is that they do. If you suck, you're out. I doubt firing someone on no notice would save an appreciable sum of money that would offset the recruiting disadvantage it would case; I highly doubt that giving people bigger survivor bonuses (to the extent there would even be that much more money available) would make the risk of getting fired worth it. At the end of the day, this "plan" sounds like dog shit.

I also don't believe (1) that you received work completed by a second year, that was not reviewed and very heavily edited by much more senior lawyers, or (2) that a partner had the incredible gall to tell you that the reason you were billed for shitty work was that his firm didn't no offer. If your employer has any clout at all, you'd fire that firm ASAP and tell him he's an idiot for staffing a shitty lawyer on your project, not reviewing and fixing the work before it went out, billing for admittedly shitty work, and having the terrible discretion to use the excuse that the reason the work was shitty was that the firm had a bad retention policy. Give me a fucking break.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by bluedolphin » Fri May 22, 2020 6:18 pm

Monochromatic Oeuvre wrote:
Fri May 22, 2020 5:35 pm
bluedolphin wrote:
Fri May 22, 2020 1:38 pm
Monochromatic Oeuvre wrote:
Fri May 22, 2020 1:08 pm
What's your actual thesis here, bootlicker? Do you think you're the first person to suggest that Biglaw could treat its employees worse and still have a waiting list? I'm guessing the same is true of your job. No-offers wreck someone's chance of ever getting back into Biglaw. Layoffs are not quite as deleterious but, when they happen at a junior level, indebted associates often can't afford them. Why are you arguing for them? Partners feeling a little inadequate at the yacht auction this year?

Firms can conduct business how they want, but people who aren't sociopaths think millionaires should bear financial burdens before people who make 10-50x less than they do, and this board (and the rest of the Internet) takes, and should take, every opportunity to call out the ones treating employees like shit and tell other people not to go there and be treated like shit.

I've heard an onslaught of in-house bitching in my time, and yet you dickcheeses keep paying these ridiculous rates. Why don't you convince your bosses to stop using Biglaw and instead hiring Shingle and Yokel LLP for your needs? Most of my colleagues have been drowning in work their entire careers and would love to have one of their pain-in-the-ass clients off their plate. So why don't you come on here and tell us when you've given your "biglaw firm hiring/firing recommendations to investment leaders," and I'll come here and tell you to get fucked with a rake every time you do?
I actually agree with most of your points, I just don't think biglaw associates are in the place compensation wise to class yourself in with the rest of the people who make these arguments. Most biglaw associates, unless you went to school late are in the top 1-2% of their age bracket for income. How much more do you make than the janitorial staff at your office 6x, 7x? The legal assistants 3x?

Biglaw comp is high enough now, where it is the type of job that shouldn't have pure job security. Layoffs really suck, and really shouldn't happen to first years since they haven't had a chance to prove themselves, but beyond that inherent risk is part of the compensation biglaw associates earn. Earning 200k or whatever the comp number for first year isn't a right, its something that is earned.

I actually think alot of the associates I work with alot are underpaid, they make sacrifices on a personal level, where its likely they hit 2500 billables in a year, but full lockstep just fucks them. Maybe their comp that year was 220, it should be closer to 300.

Theres a reason why I noted that if you are laying off support staff first, thats shit. They are in the compensaiton position where they should have a secure job.
You're just all over the place, dude.

I don't get to complain because I make more than the support staff? FWIW, I think good support staff should make more anyway. I certainly wouldn't advocate they get fired more often. But when it comes to the partners making 20x what I make, or the multibillion dollar client, suddenly the right to complain is back on the table?

You're positing a bunch of questions that have obvious management answers. Why doesn't Cravath pay more than Dechert? Because it doesn't have to in order to differentiate itself among good talent (DRIPPING with preftige). Why don't good associates make more, and why aren't bad associates shitcanned at a higher rate? Because associates in a given class year bill out at the same rate and your company doesn't demand to differentiate when it pays the bills or refuse to pay for the shitty lawyers. Why don't associates who bill 2200+ make more? Because they're not decamping for places with lower hours expectations at particularly unique rates. Why isn't the 20% associate turnover a year--which, by the way, would be considered outrageously high in almost any other industry--even higher? Because, as you danced around but never bullseyed, it's really expensive to recruit, provide for, and train associates for several years until they're good, and clients aren't willing to pay more than they do to make it happen.

It's a bit ironic that you spend all this breath on how the Biglaw model is broken and then talking about how your company hires Latham and Kirkland and all of the people who would have the power to change all of these things if they really gave a shit. The strong do what they will and the weak suffer what they must. The in-house criticism is always so pointless because it almost always comes from the same people who constantly fail to hire laterals due to giant pay cut demands, and who for the same work year after year with consistent 6% rate increases. Why would I listen to an exhortation for change from the people who are largely responsible for keeping this industry the same year after exhausting year?
I mean we don't pay for shit work and overbilling that is how this got started. Also I'd advise against playing the ad-hominem comp insult game, its not one you will win - I'm also not in-house counsel. My job and all of my colleagues job is at risk for lay-offs, its part of the exchange, in boom times we do exceedingly well, in not so great times, we don't do as well. Its likely I am laid off or things don't work out in the next 5-10 years and it is what it is. We all know it, and its all business.

If you look at your comparison set of true employees who make similar amounts of money to you its largely consulting, banking, and high finance. All have bonus heavy structures, and you don't see people blackballing Evercore because they conducted layoffs this year, or Mckinsey because they no-offered pat of the summer class.

I'm advocating for stronger performance incentives and cutting people/not offering summers that aren't performing. If you are worried about your job at that point, or your comp at that point that is on you. I agree you should be paid more, if you are performing.

Also on support staff versus yourself, support staff are often in a position where they can't be furloughed/laid off for a few months because they don't have the ability to meaningfully save. I would hope that you aren't in that position if you are more senior than a first year.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by bluedolphin » Fri May 22, 2020 6:32 pm

Lesion of Doom wrote:
Fri May 22, 2020 4:55 pm
bluedolphin wrote:
Fri May 22, 2020 3:40 pm


The people who are being staffed/sticking their hands up, aren't the ones who get laid off in the Houston office if layoffs were too happen. Layoffs always have some sort of performance component to them unless there is an axing of an entire practice group/office.

No harm no foul if you get paid a normal wage, and staff should never be laid off here. But at biglaw comp levels, I just see alot of entitlement.
Bolded is where your argument falls apart. The same associate could get wildly divergent reviews depending upon firm, group, specific partner, midlevel or senior supervisor, economy and other factors. Law students generally understand this reality and rely on uniform compensation and advancement to defuse the risk of a bad situation.

First years, especially, frequently have little control over their hours. I don't think anyone would argue that someone who refuses to work should be protected. But once you understand how arbitrary "performance" can be, it's obvious why top students demand the present format.
Workforce wise, layoffs aren't cutting 50% of the work force, its at most usually a quarter, unless your at a company that doesn't make money. If you are kept, and someone put their hand up for you, and there is usually a reason. I am in a very performance driven industry, and the people that are let go, there has always been some sort of trait that lets them go.
- Perfect work product - but yells at juniors, axed.
- Missing deadlines - axed.
- Produces Ok work, people like working with them, kept and advanced, people can see they are trying. - usually kept.

The best people can work with everyone, and most good people can work with everyone as well. There is some forms of racism/sexism that exists thats hard to quash but thats why at least on our end, our reviews are from both people more junior and senior than you and across the board.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by bluedolphin » Fri May 22, 2020 6:46 pm

Anonymous User wrote:
Fri May 22, 2020 4:39 pm
kovdak02 wrote:
Fri May 22, 2020 3:56 pm
What clients are refusing to hire V20 firms because they have some 3rd and 4th years who are doing mediocre work just to survive to the next January? That doesn’t seem like a problem that actually exists in need of a solution.
Not sure how or why that's relevant, particularly given the relatively limited universe of firms that can reasonably serve large corporate clients. Clients would surely prefer a world in which that "slack" in the system didn't exist, and it's not unexpected that they'd argue for comp systems that would disincentivize it. It's a little disingenuous to on the one hand argue that associates should try to bleed off a few months or even years of high comp for little work, and then act shocked and appalled that clients (who ultimately pay for this) would like things to be different.

Again, associates aren't doing anything wrong here! Don't owe firms anything and should take what we can get. But like... other actors in this game obviously have the same motivations and incentives, and that's not at all surprising or "wrong."

edit: accidental anon, this is galba
And I'll note, I am all for people who bill 1600 hours and that still have flawless work, responsive, still advancing, staying, maybe advancing slower than the rest. The lockstep system sucks, because it doesn't reward high performers, there is a significant number of biglaw associates who just clock in clock out.

I think that there should be a system where some machine who bills 2700 hours, produces good work,and likely makes personal sacrifices on my deal, gets paid significantly more than the 1600 hours associate. The incentive component is too small, and the high guaranteed salary fucks incentives around, especially when firms aren't pulling in 3b in revenue or whatever ungodly number Kirkland and Latham are this past year.

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Re: Change my mind: Layoffs and no-offers should happen in biglaw

Post by 12YrsAnAssociate » Fri May 22, 2020 6:50 pm

bluedolphin wrote:
Fri May 22, 2020 6:46 pm

I think that there should be a system where some machine who bills 2700 hours, produces good work,and likely makes personal sacrifices on my deal, gets paid significantly more than the 1600 hours associate. The incentive component is too small, and the high guaranteed salary fucks incentives around, especially when firms aren't pulling in 3b in revenue or whatever ungodly number Kirkland and Latham are this past year.
They do, at every firm I've ever worked at. Every firm I've worked at paid above-market bonuses for above-market billers. And advancement opportunities at every firm I've ever heard of is much better for high billers. There are lots of 1600 hour associates, and I've never seen one make it to year 6.

Seriously? What are you waiting for?

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