Are further raises likely? Forum

[Anonymous User]

Given the crazy lateral market, the COVID hours (which might not relent), and the rumours of Skadden offering 6-figure retention bonuses, how likely do people think that firms increase year-end bonuses this year (seems like a given due to the crazy COVID hours and summer raises) and/or increase base salary next year?

[JTIII]

Out of curiosity, why do people who think there will be EOY bonus raises think that to be the case? I don't see why firms would do this.

[Ultramar vistas]

Out of curiosity, why do people who think there will be EOY bonus raises think that to be the case? I don't see why firms would do this.

Because there’s three comp levers firms can pull, in order of flexibility: salary, EOY bonus, and special bonus.

Once salaries have been raised, they’re not coming down. EOY bonuses are a bit more movable - in 2008, they got cut heavily. Special bonuses are completely flexible, firms have no history of repeating them year on year so it’s no commitment.

I don’t think anyone will raise salaries again so soon, because we’re back at a good level against past salaries in terms of inflation adjusted numbers.

I could definitely see the EOY bonuses, which have been stagnant for years, being the next lever that firms pull to keep folks around without sacrificing flexibility down the line.

[Anonymous User]

Raising EOY bonuses might increase churn and lower retention. If I got more $ than expected in December, I think I’d be more likely to finally bail from biglaw.

The best retention tool is a bonus payable in the future, not an unexpected windfall like a larger EOY bonus would be. If firms are really desperate to retain associates, I could see an announcement late this year that another round of large special bonuses will be paid in the spring/summer. The rumors floating around suggest Skadden is already doing exactly this.

[Anonymous User]

Raising EOY bonuses might increase churn and lower retention. If I got more $ than expected in December, I think I’d be more likely to finally bail from biglaw.

The best retention tool is a bonus payable in the future, not an unexpected windfall like a larger EOY bonus would be. If firms are really desperate to retain associates, I could see an announcement late this year that another round of large special bonuses will be paid in the spring/summer. The rumors floating around suggest Skadden is already doing exactly this.

As a Skadden associate, I can confirm that Skadden's approach has kept me around an extra 6 months. If they increased their year-end bonus by an extra $100k, all they would have done is guaranteed I'd dip in Jan.

[Anonymous User]

Raising EOY bonuses might increase churn and lower retention. If I got more $ than expected in December, I think I’d be more likely to finally bail from biglaw.

The best retention tool is a bonus payable in the future, not an unexpected windfall like a larger EOY bonus would be. If firms are really desperate to retain associates, I could see an announcement late this year that another round of large special bonuses will be paid in the spring/summer. The rumors floating around suggest Skadden is already doing exactly this.

As a Skadden associate, I can confirm that Skadden's approach has kept me around an extra 6 months. If they increased their year-end bonus by an extra $100k, all they would have done is guaranteed I'd dip in Jan.

My hunch is that this year's bonuses will be a tad higher than last year's, but def no salary increases for a while. Also I think it's likely other firms will match Skadden's approach and offer special retention bonuses.

[Anonymous User]

I don’t foresee a large increase in year-end bonuses; as someone mentioned earlier, an unexpected windfall would just hasten the departure of a lot of associates who might otherwise stick around a while longer.

It’s important to see bonuses for what they are: firms may say they are using them to show “appreciation,” but they’re really just designed to influence associate decision-making. A far more effective tool than a year-end windfall would indeed be a guarantee of some sort that another round of large special bonuses would be arriving next summer — associates would be more likely to stick around for more cash, and of course by that point, they’re also more likely to finish out the rest of the year to get the year-end bonus. Rinse and repeat.

I think any permutation of regular year-end bonuses and no retention promises or even a year-end windfall is likely to result in mass departures. Retention bonuses are, in my view, the only thing that will keep large numbers of associates around.

[Monochromatic Oeuvre]

Raising EOY bonuses might increase churn and lower retention. If I got more $ than expected in December, I think I’d be more likely to finally bail from biglaw.

The best retention tool is a bonus payable in the future, not an unexpected windfall like a larger EOY bonus would be. If firms are really desperate to retain associates, I could see an announcement late this year that another round of large special bonuses will be paid in the spring/summer. The rumors floating around suggest Skadden is already doing exactly this.

As a Skadden associate, I can confirm that Skadden's approach has kept me around an extra 6 months. If they increased their year-end bonus by an extra $100k, all they would have done is guaranteed I'd dip in Jan.

Can you guys shut the fuck up management people read this site

I for one will only stay at my law firm if bonuses are doubled