2021 End of Year Bonuses Forum

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Tue Oct 05, 2021 12:14 pm

Anonymous User wrote:
Mon Oct 04, 2021 11:42 am
Anonymous User wrote:
Sun Oct 03, 2021 10:02 pm
For what it’s worth, partner at my V50 dropped in conversation the other day bonuses will be bigger this year than last, mentioned it as if this was obvious and I already knew. Don’t have any reason to doubt this person. We’re also bleeding associates, bringing in record profits, workflow isn’t likely to slowdown anytime soon and seems everyone’s on verge of quitting so doesn’t surprise me.
Ironically, a larger end year bonus this year would make me more likely to quit sooner, not less, since I would get closer to my savings goal for exiting Biglaw. But YMMV. And I wouldn’t convey that to my firm’s management.
You just did.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Tue Oct 05, 2021 2:12 pm

almostperfectt wrote:
Tue Oct 05, 2021 11:08 am
Anonymous User wrote:
Tue Oct 05, 2021 12:44 am
What about pay cuts? Prefer taking a $100k pay cut and work 1/3 less.
Go away.

Not being glib, actually go in-house and you can do that exact thing.
Whenever people mention how great it'd be to take a pay cut and cut back on the hours, I roll my eyes because even if you worked less, there is still the dreaded "on call" nature of BigLaw that makes the job so terrible. E.g., you could bill only 30 hours in a week but still have an absolutely miserable week and have a chunk of those hours billed at weird hours or during the weekend.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Tue Oct 05, 2021 2:21 pm

Right, one of the worst aspects of biglaw is not having any sort of confidence that I'll have weekends off. Even if biglaw hired more people at lower pay that's still there. Adding another person onto your deal team isn't going to get rid of that (and past a certain point adding more people to a deal team gets increasingly inefficient).

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existentialcrisis

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Re: 2021 End of Year Bonuses

Post by existentialcrisis » Tue Oct 05, 2021 10:25 pm

Anonymous User wrote:
Tue Oct 05, 2021 2:21 pm
Right, one of the worst aspects of biglaw is not having any sort of confidence that I'll have weekends off. Even if biglaw hired more people at lower pay that's still there. Adding another person onto your deal team isn't going to get rid of that (and past a certain point adding more people to a deal team gets increasingly inefficient).
This.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 11:10 am

existentialcrisis wrote:
Tue Oct 05, 2021 10:25 pm
Anonymous User wrote:
Tue Oct 05, 2021 2:21 pm
Right, one of the worst aspects of biglaw is not having any sort of confidence that I'll have weekends off. Even if biglaw hired more people at lower pay that's still there. Adding another person onto your deal team isn't going to get rid of that (and past a certain point adding more people to a deal team gets increasingly inefficient).
This.
Sort of this. But I have been in countless situations where it would have been wonderful if there was another associate or two to handle things that come up. It is nearly impossible to evade "Associate X, plz handle," whereas "Associates X, Y, Z, can one of you plz handle" at least creates the opportunity for associates to confer and take turns addressing the fire drills. IMO one of the primary reasons associates don't take time off in big law (even if sick in bed or for vacation, mental breaks) is the reality that teams are becoming so lean there isn't always (or usually isn't) someone there to pick up the slack, and knowledge/responsibility gets completely centralized in one or two individuals.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 11:13 am

I think the bonus scale will be up, but only marginally so. Think like:

20
30
60
75
90
100
110

So 5-10k increases depending on class year. As someone else pointed out upthread to not increase it somewhat given the crazy economics of the industry right now would be hard to justify. But I think biglaw firms have realized there's more value in the spring/fall retention structure so that's where their focus will be as far as real money. I do expect another round of spring/fall bonuses to be announced that will be around the same level as they were in 21.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 11:29 am

I don't see a universe where firms don't announce next year's special bonuses at the same time at EOY bonuses in the next month or two. Associates who are burned out are evaluating exit options right NOW, so firms need to give them a reason to stick around and not have something lined up come January.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 11:42 am

I think bonuses are going to be up 50% across the scale.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 11:49 am

Anonymous User wrote:
Tue Oct 05, 2021 2:12 pm
almostperfectt wrote:
Tue Oct 05, 2021 11:08 am
Anonymous User wrote:
Tue Oct 05, 2021 12:44 am
What about pay cuts? Prefer taking a $100k pay cut and work 1/3 less.
Go away.

Not being glib, actually go in-house and you can do that exact thing.
Whenever people mention how great it'd be to take a pay cut and cut back on the hours, I roll my eyes because even if you worked less, there is still the dreaded "on call" nature of BigLaw that makes the job so terrible. E.g., you could bill only 30 hours in a week but still have an absolutely miserable week and have a chunk of those hours billed at weird hours or during the weekend.
I'm a stub year billing barely 20 hrs a week, hopefully will pick up soon (I want my bonus!) but I feel this already. Had a day where my first meeting was at 8am and last email from a partner at 11pm. I was obviously not working 15 hours but yeah, on call.

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Anonymous User
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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 12:05 pm

(A) Why is it obvious that you weren't working all 15 hours? Working for 15+ hours in a day is absolutely a thing.

(B) What firm ties stub bonus to hours??

TLSposter1990

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Re: 2021 End of Year Bonuses

Post by TLSposter1990 » Fri Oct 08, 2021 12:19 pm

I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.

Buglaw

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Re: 2021 End of Year Bonuses

Post by Buglaw » Fri Oct 08, 2021 12:22 pm

Anonymous User wrote:
Tue Oct 05, 2021 2:12 pm
almostperfectt wrote:
Tue Oct 05, 2021 11:08 am
Anonymous User wrote:
Tue Oct 05, 2021 12:44 am
What about pay cuts? Prefer taking a $100k pay cut and work 1/3 less.
Go away.

Not being glib, actually go in-house and you can do that exact thing.
Whenever people mention how great it'd be to take a pay cut and cut back on the hours, I roll my eyes because even if you worked less, there is still the dreaded "on call" nature of BigLaw that makes the job so terrible. E.g., you could bill only 30 hours in a week but still have an absolutely miserable week and have a chunk of those hours billed at weird hours or during the weekend.
Yeah, this is why reduced pace so rarely works out for parents. It's not the 40 hour billable weeks that makes parenting and big law so hard. It's the multiple 50+ billable hour weeks in a row that make it Super Hard and 60+ hour weeks that make it basically impossible. You don't really get to avoid those on a reduced pace schedule. You just get more 20-30 billable hour weeks.

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cornerstone

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Re: 2021 End of Year Bonuses

Post by cornerstone » Fri Oct 08, 2021 1:08 pm

TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?

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Monochromatic Oeuvre

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Re: 2021 End of Year Bonuses

Post by Monochromatic Oeuvre » Fri Oct 08, 2021 1:39 pm

Anonymous User wrote:
Sun Oct 03, 2021 1:00 pm
Anonymous User wrote:
Sun Oct 03, 2021 12:04 pm
almostperfectt wrote:
Sun Oct 03, 2021 10:41 am
Anonymous User wrote:
Sun Oct 03, 2021 9:43 am
As someone who lateraled this year and got his new firm to pay the full special bonuses, and knows others who did the same, the notion that they are driving “retention” is laughable. If anything, it’s just that associates are now structuring their departures around the timing of the bonuses—which is exactly what they have always done with end-year bonuses.
Exactly this. If every peer firm is paying them and theres no clawback if you leave (or required time hired to have them) then they are indistinguishable from year end bonus and don't drive retention any moreso
Isn’t it customary to have a one-year clawback on any bonuses paid or guaranteed at the new firm? If that is true, the retention bonuses would only work to increase retention at the new firm and not the old firm.
I lateralled earlier this year and there was no clawback in my offer letter on my signing bonus or any of the special/annual bonuses. This might be more of a thing when you lateral late year and get your annual bonus guaranteed, or in a less hot hiring market.

And I think the special bonuses are absolutely stringing along some associates and delaying biglaw exit plans. Attrition is bad right now but we don't see what it would be but for the special bonuses. And it's also true that the special bonuses aren't true retention bonuses...the reported Skadden bonuses that are tied to being at the firm on X date in 2022 are (and there's very little chance those would get matched by another firm).
For posterity: signing bonuses also sometimes partially vest, by not having a clawback but just coming in multiple payments over time, or having a clawback fully prorated to the portion of a year you last.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 2:06 pm

cornerstone wrote:
Fri Oct 08, 2021 1:08 pm
TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?
Because profit growth in the V25 has been bonkers and retention is shit and those two things together mean it will be hard to stand pat on EoY bonuses when associates are already pissed off / demoralized and looking for any excuse to walk. Some firm in the V10/V25 is going to blink and offer more money than 2020 status quo and then it will follow w/ the others.

TLSposter1990

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Re: 2021 End of Year Bonuses

Post by TLSposter1990 » Fri Oct 08, 2021 3:05 pm

cornerstone wrote:
Fri Oct 08, 2021 1:08 pm
TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?
I don't have any special insight, if that's what you're asking. I just think that firms recognize that they are doing too well and associates have been far too busy for bonuses to stay the same without seriously pissing off their associates. The additional 10-15k per class that I put are (in my view) the minimum amounts that will make associates feel recognized and appreciated for all the craziness (e.g., no 5th year is feeling appreciated over an extra 5-10k). At the end of the day, firms hope that recognition/appreciation will have a positive effect on morale and retention -- a happy worker bee is a productive worker bee.

In the event the EOY scale stays the same, I think that just means the spring/fall retention bonuses will go up by approximately those same amounts. Same logic -- firms do not want to risk pissing off their associates at a time when associates are so valuable and in such short supply. Maybe firms will prefer this route since it forces the associate to stick around longer for the extra cash, but since I think the two scales will be announced together, it more or less accomplishes the same goal.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 3:28 pm

I wonder why we don't see firms go with a big multiplier for high billers (like 2x market for 2500+ hours) so they can stratify pay for busiest and slowest practices

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Anonymous User
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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 3:41 pm

Anonymous User wrote:
Fri Oct 08, 2021 2:06 pm
cornerstone wrote:
Fri Oct 08, 2021 1:08 pm
TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?
Because profit growth in the V25 has been bonkers and retention is shit and those two things together mean it will be hard to stand pat on EoY bonuses when associates are already pissed off / demoralized and looking for any excuse to walk. Some firm in the V10/V25 is going to blink and offer more money than 2020 status quo and then it will follow w/ the others.
I feel like this topic has been addressed a lot, but if retention is the problem/goal (and it is), any EOY increase that a firm is tempted to tack on would be better served as an April bonus or something. "Here's your usual market year end bonus - oh yeah, and you can get 40% of it again if you're still here as of April 29th."

Increasing EOY bonuses as a windfall probably is counterproductive to retention, since I expect it would push some wobbly associates off of the biglaw ledge, deciding they've finally pocketed enough cash to make the jump and leave biglaw entirely.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 4:03 pm

Anonymous User wrote:
Fri Oct 08, 2021 3:41 pm

I feel like this topic has been addressed a lot, but if retention is the problem/goal (and it is), any EOY increase that a firm is tempted to tack on would be better served as an April bonus or something. "Here's your usual market year end bonus - oh yeah, and you can get 40% of it again if you're still here as of April 29th."

Increasing EOY bonuses as a windfall probably is counterproductive to retention, since I expect it would push some wobbly associates off of the biglaw ledge, deciding they've finally pocketed enough cash to make the jump and leave biglaw entirely.
Are that many associates out there really biding their time until they hit an exact net worth to leave? I'm sure there is one or two, but this is not at all part of my calculus and have never been told by any peer (still in big law or having already left) this is what they're doing. Obviously if they suddenly pushed the bonuses into retire-early territory ($500k+) then I could see people suddenly deciding to leave, although let's be honest, if they started throwing out those kind of bonuses I think a lot of people would stop leaving. But I have a hard time believing tacking on an extra 10-20k at year end will suddenly lead to a massive exodus.

Wanderingdrock

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Re: 2021 End of Year Bonuses

Post by Wanderingdrock » Fri Oct 08, 2021 4:07 pm

Anonymous User wrote:
Fri Oct 08, 2021 3:41 pm
Anonymous User wrote:
Fri Oct 08, 2021 2:06 pm
cornerstone wrote:
Fri Oct 08, 2021 1:08 pm
TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?
Because profit growth in the V25 has been bonkers and retention is shit and those two things together mean it will be hard to stand pat on EoY bonuses when associates are already pissed off / demoralized and looking for any excuse to walk. Some firm in the V10/V25 is going to blink and offer more money than 2020 status quo and then it will follow w/ the others.
I feel like this topic has been addressed a lot, but if retention is the problem/goal (and it is), any EOY increase that a firm is tempted to tack on would be better served as an April bonus or something. "Here's your usual market year end bonus - oh yeah, and you can get 40% of it again if you're still here as of April 29th."

Increasing EOY bonuses as a windfall probably is counterproductive to retention, since I expect it would push some wobbly associates off of the biglaw ledge, deciding they've finally pocketed enough cash to make the jump and leave biglaw entirely.
On the other hand, 5-15k isn't a big compensation bump percentage-wise, especially not in real terms given rising inflation, so maybe firms will recognize that associates aren't exactly making perfectly rational economic decisions and there's a degree of "Do I feel appreciated?" in all of this. Increasing EOY bonuses *might* push some wobbly associates to quit, but remember that those same associates could just wait an extra biweekly paycheck's worth of time to collect the difference if EOY bonuses don't increase. On the other hand, cynically pushing up the retention bonuses instead could just piss off those wobbly associates, not to mention the rest of us, who will look at static EOY bonuses and say to ourselves, "My firm's PPP has increased by HOW MUCH over the past few years and they're still labeling us with the same value numbers?"

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Re: 2021 End of Year Bonuses

Post by Buglaw » Fri Oct 08, 2021 4:09 pm

Anonymous User wrote:
Fri Oct 08, 2021 3:41 pm
Anonymous User wrote:
Fri Oct 08, 2021 2:06 pm
cornerstone wrote:
Fri Oct 08, 2021 1:08 pm
TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?
Because profit growth in the V25 has been bonkers and retention is shit and those two things together mean it will be hard to stand pat on EoY bonuses when associates are already pissed off / demoralized and looking for any excuse to walk. Some firm in the V10/V25 is going to blink and offer more money than 2020 status quo and then it will follow w/ the others.
I feel like this topic has been addressed a lot, but if retention is the problem/goal (and it is), any EOY increase that a firm is tempted to tack on would be better served as an April bonus or something. "Here's your usual market year end bonus - oh yeah, and you can get 40% of it again if you're still here as of April 29th."

Increasing EOY bonuses as a windfall probably is counterproductive to retention, since I expect it would push some wobbly associates off of the biglaw ledge, deciding they've finally pocketed enough cash to make the jump and leave biglaw entirely.
I disagree with this take. As a general rule, more money is better for retention and less money is worse. Partners sometimes come up with some crazy mental gymnastics regarding pay, but this one seems even beyond that.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 4:14 pm

I think changing the EOY bonus model entirely would actually do wonders for retention. Give out bonuses every month that are directly tied to billables. Create real incentives to bill more than necessary to make market and hand out the reward more frequently than every 12 months.

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Re: 2021 End of Year Bonuses

Post by Anonymous User » Fri Oct 08, 2021 4:59 pm

Buglaw wrote:
Fri Oct 08, 2021 4:09 pm
Anonymous User wrote:
Fri Oct 08, 2021 3:41 pm
Anonymous User wrote:
Fri Oct 08, 2021 2:06 pm
cornerstone wrote:
Fri Oct 08, 2021 1:08 pm
TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?
Because profit growth in the V25 has been bonkers and retention is shit and those two things together mean it will be hard to stand pat on EoY bonuses when associates are already pissed off / demoralized and looking for any excuse to walk. Some firm in the V10/V25 is going to blink and offer more money than 2020 status quo and then it will follow w/ the others.
I feel like this topic has been addressed a lot, but if retention is the problem/goal (and it is), any EOY increase that a firm is tempted to tack on would be better served as an April bonus or something. "Here's your usual market year end bonus - oh yeah, and you can get 40% of it again if you're still here as of April 29th."

Increasing EOY bonuses as a windfall probably is counterproductive to retention, since I expect it would push some wobbly associates off of the biglaw ledge, deciding they've finally pocketed enough cash to make the jump and leave biglaw entirely.
I disagree with this take. As a general rule, more money is better for retention and less money is worse. Partners sometimes come up with some crazy mental gymnastics regarding pay, but this one seems even beyond that.
OK, fair (I am the quoted anon). I'll revise my take to say the associate-retention value of any dollar above the static EOY bonus amounts is highest when the dollar is used as a 2022 special bonus, rather than as an increase in the EOY bonus scale.

TLSposter1990

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Re: 2021 End of Year Bonuses

Post by TLSposter1990 » Fri Oct 08, 2021 5:05 pm

Anonymous User wrote:
Fri Oct 08, 2021 4:59 pm
Buglaw wrote:
Fri Oct 08, 2021 4:09 pm
Anonymous User wrote:
Fri Oct 08, 2021 3:41 pm
Anonymous User wrote:
Fri Oct 08, 2021 2:06 pm
cornerstone wrote:
Fri Oct 08, 2021 1:08 pm
TLSposter1990 wrote:
Fri Oct 08, 2021 12:19 pm
I think the scale will be set by Davis Polk and will go up 10k for juniors and 15k for midlevels/seniors. Something like this:

25k
35k
65k
80k
95k
105k
115k
115k

I also think they will announce spring/fall retention bonuses, same scale as last year, payable April 30 and August 31.
Why do you think this? Anything to say to those ITT who doubt that base bonuses will go up this year?
Because profit growth in the V25 has been bonkers and retention is shit and those two things together mean it will be hard to stand pat on EoY bonuses when associates are already pissed off / demoralized and looking for any excuse to walk. Some firm in the V10/V25 is going to blink and offer more money than 2020 status quo and then it will follow w/ the others.
I feel like this topic has been addressed a lot, but if retention is the problem/goal (and it is), any EOY increase that a firm is tempted to tack on would be better served as an April bonus or something. "Here's your usual market year end bonus - oh yeah, and you can get 40% of it again if you're still here as of April 29th."

Increasing EOY bonuses as a windfall probably is counterproductive to retention, since I expect it would push some wobbly associates off of the biglaw ledge, deciding they've finally pocketed enough cash to make the jump and leave biglaw entirely.
I disagree with this take. As a general rule, more money is better for retention and less money is worse. Partners sometimes come up with some crazy mental gymnastics regarding pay, but this one seems even beyond that.
OK, fair (I am the quoted anon). I'll revise my take to say the associate-retention value of any dollar above the static EOY bonus amounts is highest when the dollar is used as a 2022 special bonus, rather than as an increase in the EOY bonus scale.
This may be true, but firms also recognize (as do associates) that it is more important and makes a bigger statement when EOY bonuses increase. The same way it has traditionally made more of a statement when salaries increased as opposed to EOY bonuses. With work as crushing as it's been and given that the EOY scale has been stagnant for 5+ years, I expect someone (David Polk, Milbank) to increase the EOY scale.

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cornerstone

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Re: 2021 End of Year Bonuses

Post by cornerstone » Mon Oct 11, 2021 11:34 am

I hear what everyone is saying - from the associate perspective bumping up EOY bonuses would be a bigger morale boost than special bonuses in the same amount. That said, I think that difference will be lost on most partners who are more concerned with maintaining their (now even larger) PPP in the event that the economy takes a downturn. I think the better argument from a partner's perspective is that bumping EOY bonuses is like a retention bonus that keeps on giving (you incentivize staying the a full year, and then the next, etc.), rather than just something that sends a better message (see, e.g., firms that prioritized client messaging over associate messaging by delaying the first COVID bonus announcements until EOY bonus decisions).

All it takes is one firm (likely CSM, DPW, or Milbank?) to get the point and the whole lot will fall in line. I'm just not convinced that will happen this year (that's just like my opinion, man). Regardless, I do think there's a good chance we see extra $$$ over market EOY in some form.

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