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To be clear, the line of thinking that "giving more money = increased attrition" is an absolutely foolish one that goes against all economic evidence. It's a classic example of lawyers overthinking something and missing the basic insight. Yes, there will be edge cases where an attorney is prompted to leave because they finally reach a number, but the overwhelming effect of more money = better retention, regardless of how it comes.Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
The additional advantage of basically announcing special bonuses for later in 2022 is that it's much easier to cut those in the future than it would be to pull back on the EOY bonus (just as EOY bonus is easier to cut than salary).Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
This is absolutely right. Bonus increases as a retention tool is based on the fact that associates will look at how much more they'll make next year and decide to stick around. Also, from personal experience, very few people actually leave biglaw after achieving some specific monetary goal that they set before they start---it very often ends up being a moving target. People quit biglaw because they're burned out and/or have a better option, not because they piled up $100K in their savings account.Anonymous User wrote: ↑Tue Oct 19, 2021 1:31 pmTo be clear, the line of thinking that "giving more money = increased attrition" is an absolutely foolish one that goes against all economic evidence. It's a classic example of lawyers overthinking something and missing the basic insight. Yes, there will be edge cases where an attorney is prompted to leave because they finally reach a number, but the overwhelming effect of more money = better retention, regardless of how it comes.Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
I understand this in theory, but I wonder how well it holds up in practice. Do we have any examples of EOY bonus being cut in biglaw? I know there were some salary cuts in 2020 to deal with uncertainties.Elvis_Dumervil wrote: ↑Tue Oct 19, 2021 2:09 pmThe additional advantage of basically announcing special bonuses for later in 2022 is that it's much easier to cut those in the future than it would be to pull back on the EOY bonus (just as EOY bonus is easier to cut than salary).Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
Yeah, literally the last recession. And I'm sure you could go back to previous recessions and find the same thing. In 2007, first-years (not stub) got $35k plus a special $10k, $45k total. 2008, $17.5k. 2009, $7.5k. (All Cravath, all from ATL posts).almostperfectt wrote: ↑Tue Oct 19, 2021 2:44 pmI understand this in theory, but I wonder how well it holds up in practice. Do we have any examples of EOY bonus being cut in biglaw? I know there were some salary cuts in 2020 to deal with uncertainties.Elvis_Dumervil wrote: ↑Tue Oct 19, 2021 2:09 pmThe additional advantage of basically announcing special bonuses for later in 2022 is that it's much easier to cut those in the future than it would be to pull back on the EOY bonus (just as EOY bonus is easier to cut than salary).Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
Oh wow I had no idea. That's an insane cut and now I feel even more entitled to $$$Anonymous User wrote: ↑Tue Oct 19, 2021 3:11 pmYeah, literally the last recession. And I'm sure you could go back to previous recessions and find the same thing. In 2007, first-years (not stub) got $35k plus a special $10k, $45k total. 2008, $17.5k. 2009, $7.5k. (All Cravath, all from ATL posts).almostperfectt wrote: ↑Tue Oct 19, 2021 2:44 pmI understand this in theory, but I wonder how well it holds up in practice. Do we have any examples of EOY bonus being cut in biglaw? I know there were some salary cuts in 2020 to deal with uncertainties.Elvis_Dumervil wrote: ↑Tue Oct 19, 2021 2:09 pmThe additional advantage of basically announcing special bonuses for later in 2022 is that it's much easier to cut those in the future than it would be to pull back on the EOY bonus (just as EOY bonus is easier to cut than salary).Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
For fifth years, the 2007-2009 numbers are $95k ($55k bonus, $40k special), $27.5k, $25k.
So yes, there was a decline of nearly 75%.
ETA: I'm not sure the salary scale has ever declined (though definitely in 2008/9 some marginal firms cut pay, and there were layoffs, start date delays, de-equitizations, etc.)
Probably you could get bonus info from earlier years, e.g. 2001, from American Lawyer, but that's not what I want to do at the moment.
Harder to walk back salary increases, though some firms got over the fear of exposing themselves as TTT and did it (*cough* Mayer Brown *cough*) at the outset of covid. Bonuses are traditionally the first to go. Demand as much bonus as you can, while you can. You never know what tomorrow brings.almostperfectt wrote: ↑Tue Oct 19, 2021 3:54 pmOh wow I had no idea. That's an insane cut and now I feel even more entitled to $$$Anonymous User wrote: ↑Tue Oct 19, 2021 3:11 pmYeah, literally the last recession. And I'm sure you could go back to previous recessions and find the same thing. In 2007, first-years (not stub) got $35k plus a special $10k, $45k total. 2008, $17.5k. 2009, $7.5k. (All Cravath, all from ATL posts).almostperfectt wrote: ↑Tue Oct 19, 2021 2:44 pmI understand this in theory, but I wonder how well it holds up in practice. Do we have any examples of EOY bonus being cut in biglaw? I know there were some salary cuts in 2020 to deal with uncertainties.Elvis_Dumervil wrote: ↑Tue Oct 19, 2021 2:09 pmThe additional advantage of basically announcing special bonuses for later in 2022 is that it's much easier to cut those in the future than it would be to pull back on the EOY bonus (just as EOY bonus is easier to cut than salary).Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
For fifth years, the 2007-2009 numbers are $95k ($55k bonus, $40k special), $27.5k, $25k.
So yes, there was a decline of nearly 75%.
ETA: I'm not sure the salary scale has ever declined (though definitely in 2008/9 some marginal firms cut pay, and there were layoffs, start date delays, de-equitizations, etc.)
Probably you could get bonus info from earlier years, e.g. 2001, from American Lawyer, but that's not what I want to do at the moment.
Barrred wrote: ↑Tue Oct 19, 2021 2:43 pmAnonymous User wrote: ↑Tue Oct 19, 2021 1:31 pmWhat about $1.0mm on top of that 100k? I should quit already.Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmPeople quit biglaw because they're burned out and/or have a better option, not because they piled up $100K in their savings account.
lol $1.1m can be a lot or a little depending on how you are living your life and what your future plans are. Absolute numbers w/o context are pretty meaninglessAnonymous User wrote: ↑Tue Oct 19, 2021 8:18 pmBarrred wrote: ↑Tue Oct 19, 2021 2:43 pmAnonymous User wrote: ↑Tue Oct 19, 2021 1:31 pmWhat about $1.0mm on top of that 100k? I should quit already.Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmPeople quit biglaw because they're burned out and/or have a better option, not because they piled up $100K in their savings account.
This but not joking.Anonymous User wrote: ↑Tue Oct 19, 2021 10:38 pmHi for any partners reading this I just want you to know that if you give me a big bonus I will be very grateful and loyal to the firm.
This and I'm burnt out. The only way to keep me going is with more EOY cash bonus than I already expect to receive based on prior year scales. I really like money because it motivates me to work harder and makes me feel good about what I'm doing with my life.Wanderingdrock wrote: ↑Wed Oct 20, 2021 8:22 amThis but not joking.Anonymous User wrote: ↑Tue Oct 19, 2021 10:38 pmHi for any partners reading this I just want you to know that if you give me a big bonus I will be very grateful and loyal to the firm.
A partner mentioned to me in passing that, then as an associate, it took five years post-Recession for his bonus amount to return to the level it had been before the crash.almostperfectt wrote: ↑Tue Oct 19, 2021 3:54 pmOh wow I had no idea. That's an insane cut and now I feel even more entitled to $$$Anonymous User wrote: ↑Tue Oct 19, 2021 3:11 pmYeah, literally the last recession. And I'm sure you could go back to previous recessions and find the same thing. In 2007, first-years (not stub) got $35k plus a special $10k, $45k total. 2008, $17.5k. 2009, $7.5k. (All Cravath, all from ATL posts).almostperfectt wrote: ↑Tue Oct 19, 2021 2:44 pmI understand this in theory, but I wonder how well it holds up in practice. Do we have any examples of EOY bonus being cut in biglaw? I know there were some salary cuts in 2020 to deal with uncertainties.Elvis_Dumervil wrote: ↑Tue Oct 19, 2021 2:09 pmThe additional advantage of basically announcing special bonuses for later in 2022 is that it's much easier to cut those in the future than it would be to pull back on the EOY bonus (just as EOY bonus is easier to cut than salary).Anonymous User wrote: ↑Tue Oct 19, 2021 1:06 pmIt seems there are two trains of thought on this:
1. Biglaw is having another historic year in terms of profits and hours worked by associate, and not increasing bonuses whilst the partners make record amounts would be unfathomable.
2. Increasing EOY bonuses is likely to just cause more associates to leave as they get a large lump sum and thus worsen attrition.
I personally believe that the first option is more likely, but would not be surprised if the bonus is paid out over the course of the year, similar to banking where there is a material time gap between bonus announcements and vesting. A lot of people also believe that retention/special bonuses will also be announced at the same time in order to try and reign in the amount of people that would leave after getting an increased bonus. Just my $0.02.
For fifth years, the 2007-2009 numbers are $95k ($55k bonus, $40k special), $27.5k, $25k.
So yes, there was a decline of nearly 75%.
ETA: I'm not sure the salary scale has ever declined (though definitely in 2008/9 some marginal firms cut pay, and there were layoffs, start date delays, de-equitizations, etc.)
Probably you could get bonus info from earlier years, e.g. 2001, from American Lawyer, but that's not what I want to do at the moment.
I can't tell you the number of colleagues I've seen this year especially who have just said "fuck it" and have gone in-house. People who were viewed as promising candidates for equity. People with great reputations. People who were considered great lawyers. Everyone is getting burned out.