Milbank/Davis Polk/Cravath Scale: NYC to 215-415k Forum

[ajax]

It’s a wonder how unlimited money printing by global central banks as well as unlimited student loans offered by federal government can cause high skilled labor allocation disruptions in an otherwise “free” market.

As many leaders in the investment space have been pointing out, global central bank printing causing populism and will eventually result in a reckoning (see guillotines in France, American civil war and Great Depression leading to world war 2, all of which happened after mass inequality). Hope we can keep our republic intact. Populism there for a dictator to ride.

Enjoy the wage inflation for the time being. Suggest diversifying in equities of companies in countries that have reasonable gdp/debt and high freedom index scores.

[Anonymous User]

It’s a wonder how unlimited money printing by global central banks as well as unlimited student loans offered by federal government can cause high skilled labor allocation disruptions in an otherwise “free” market.

As many leaders in the investment space have been pointing out, global central bank printing causing populism and will eventually result in a reckoning (see guillotines in France, American civil war and Great Depression leading to world war 2, all of which happened after mass inequality). Hope we can keep our republic intact. Populism there for a dictator to ride.

Enjoy the wage inflation for the time being. Suggest diversifying in equities of companies in countries that have reasonable gdp/debt and high freedom index scores.

There's so much FUD in this and then the last paragraph basically says invest in USA. Which still has a way more reasonable gdp/debt ratio than other countries.

We've had like 6 months of elevated inflation after a 10 year period of basically no inflation. R-E-L-A-X. RELAX.

[Anonymous User]

Any thoughts on whether low v100s / amlaw 100s will match?

[Wanderingdrock]

Any thoughts on whether low v100s / amlaw 100s will match?

YEEESSS, inject the rampant speculation directly into my veins. (Seriously, what the hell else am I going to do until my firm matches? Bill??)

Did they match in the last round? If I recall correctly, most did but some didn't. I suspect that will happen again - some marginal increased stratification but for the most part uniform matches, if only because if your firm can't afford to keep up then it's probably already slipping out of the top 100 and being replaced by someone who can.

[VentureMBA]

Tell anyone in any other job that we just pay people the exact same amount regardless of performance and they won't believe you. Nowhere else do you get a raise every year just because you didn't get fired and make the same whether you're the first or last associate in your class. It is insane and I see why partners resist giving raises to people they wish they could fire.

I mean, many government (especially unionized) jobs are like this (automatic raises every year just because you didnt get fired, everyone -- at least with the same degree--makes the same). Thats what the GS scale is, thats what teacher pay scales are, etc.... see eg https://www.atlantapublicschools.us/cms ... .07.21.pdf

Let me rephrase - tell anyone that private sector BigLaw attorney compensation mirrors teachers' unions and they won't believe you.

No one confuses the unionization of government employees for a meritocracy. If anything, this gives credence to my earlier point.

People actually get fired at GS. You have to basically use a racial slur to get fired from BigLaw. Anyone that has worked in major IB knows half of their class gets pushed out. How many people do you know that got pushed out of your law firm?

[The Lsat Airbender]

As many leaders in the investment space have been pointing out, global central bank printing causing populism and will eventually result in a reckoning (see guillotines in France, American civil war and Great Depression leading to world war 2, all of which happened after mass inequality). Hope we can keep our republic intact. Populism there for a dictator to ride.

Whingeing about "unlimited money printing", i.e., monetary stimulus that enabled the economy to grow through the pandemic at the low cost of 6% inflation (which is nowhere near the levels that cause populist revolt historically) never fails to amuse me. Like, the Great Depression was literally a deflationary episode, brought on in part by smoothbrains who insisted on tight money.

[Anonymous User]

Any thoughts on whether low v100s / amlaw 100s will match?

Some will match fully.
Some will "match" but do black box after first year or two.
Some will wait 4 months for no particular reason, then match/"match".
And some won't match.

[Anonymous User]

Tell anyone in any other job that we just pay people the exact same amount regardless of performance and they won't believe you. Nowhere else do you get a raise every year just because you didn't get fired and make the same whether you're the first or last associate in your class. It is insane and I see why partners resist giving raises to people they wish they could fire.

I mean, many government (especially unionized) jobs are like this (automatic raises every year just because you didnt get fired, everyone -- at least with the same degree--makes the same). Thats what the GS scale is, thats what teacher pay scales are, etc.... see eg https://www.atlantapublicschools.us/cms ... .07.21.pdf

Let me rephrase - tell anyone that private sector BigLaw attorney compensation mirrors teachers' unions and they won't believe you.

No one confuses the unionization of government employees for a meritocracy. If anything, this gives credence to my earlier point.

People actually get fired at GS. You have to basically use a racial slur to get fired from BigLaw. Anyone that has worked in major IB knows half of their class gets pushed out. How many people do you know that got pushed out of your law firm?

Right. Biglaw and government/unionized jobs are completely different.

The entire biglaw system is built on the fungibility of associates. That's mostly because seniority is a much easier/better approximation of value to the firm than anything else; the firm's revenue from each associate is approximately proportional to seniority. Sure, there are better and worse associates, but when does such an associate truly create a different OUTCOME for the firm? Staff one of us on a matter, and you'll achieve approximately the same results for your client 9/10x, so why bother differentiating. Also, try justifying to a client a higher rate for some junior because they got "top notch reviews" last year... lol. That's why they treat us all the same. And where needed, firms can reward the "good ones" with something else: partnership prospects. Conversely, because of the "up or out" nature of firms, then the bad ones often leave on their own when they realize that they have no shot at partnership. You rarely need to fire them. Not to mention the grueling nature of the job creates constant attrition. This is why it works for biglaw, even if it's not the most efficient scheme in the world.

These concepts are totally inapplicable to government workers and teacher's unions. There are no analogs to the concept of "partnership" or "up or out"/high attrition to incentivize keeping the good ones and force the bad ones out, respectively. Thus, the only end goal becomes your standardized pay and pension. If that's not enough for you, the good ones leave (if they can find higher paying work). I worked for a small government agency before law school and my boss told me when I left "why do all the good ones leave for law school?" Because the career is a dead end. On the other hand, if you don't take pride in your work, it's really freaking hard to get pushed out. I work opposite that same government agency now and see how great of a gig it is for the lazy, poor performers.

I'm not arguing that it wouldn't be better to pay EVERYONE (biglaw, government, unions, etc.) based on merit. That's not my point. I'm just trying to explain why it works okay for biglaw but not elsewhere.

[Anonymous User]

Some will wait 4 months for no particular reason, then match/"match".

Does it apply retroactively when they wait 4 months then match/"match"? I'd imagine no and the longer they wait, the more the firms save (from not paying 4 months of salary increase)

[Anonymous User]

Some will wait 4 months for no particular reason, then match/"match".

Does it apply retroactively when they wait 4 months then match/"match"? I'd imagine no and the longer they wait, the more the firms save (from not paying 4 months of salary increase)

Bingo. This is what I'm fully expecting out of my cheap V50.

[Anonymous User]

Milbank and now Cadwalader are making the salary raise retroactive to January 1st. Do we think all the big, rich firms that are definitely going to match will also include the retroactive bit?

[Anonymous User]

Milbank and now Cadwalader are making the salary raise retroactive to January 1st. Do we think all the big, rich firms that are definitely going to match will also include the retroactive bit?

For the most part, yes, but mine probably won't - we're V25 but our annual raises only happen on Feb. 1 with our fiscal year changeover. So I would assume our raises will take effect Feb. 1 once announced, though it'd be nice if they retro'ed at least the previous class year's raises for the month of January.

[Anonymous User]

Cadwalader Saw Partner Profits Soar by 70% as Revenue Grew More Than 30% in 2021

Well this explains some things

[Anonymous User]

Milbank and now Cadwalader are making the salary raise retroactive to January 1st. Do we think all the big, rich firms that are definitely going to match will also include the retroactive bit?

For the most part, yes, but mine probably won't - we're V25 but our annual raises only happen on Feb. 1 with our fiscal year changeover. So I would assume our raises will take effect Feb. 1 once announced, though it'd be nice if they retro'ed at least the previous class year's raises for the month of January.

CWT associate, FWIW our annual raises typically don’t take effect until mid-late Feb either

[Anonymous User]

So do we think one of the NYC big boys are going to come in and one-up Milbank like last time? DPW/CSM/Kirkland/Cleary/Debevoise/Skadden/insert-NYC-big-firm all had monster years and don't seem to be slowing down. There seems to be less noise about coming over the top this time around. Regardless, major props to Milbank for getting things moving once again...they are really making a statement.

[Anonymous User]

So do we think one of the NYC big boys are going to come in and one-up Milbank like last time? DPW/CSM/Kirkland/Cleary/Debevoise/Skadden/insert-NYC-big-firm all had monster years and don't seem to be slowing down. There seems to be less noise about coming over the top this time around. Regardless, major props to Milbank for getting things moving once again...they are really making a statement.

K&E can't even give out top market bonuses anymore, no shot they come over the top. They might not even match!

[Anonymous User]

Cadwalader Saw Partner Profits Soar by 70% as Revenue Grew More Than 30% in 2021

Well this explains some things

Wow. I suppose that level of growth makes CWT an outlier (and the article specifically mentions they had a weak 2020 which enlarges these growth rates). But still, I wouldn’t be surprised to see many of the other firms that were hovering in the $4-5M PPEP range move into the $5-7M PPEP range.

[Anonymous User]

As a regulatory associate, this makes me very happy. I've been stressed out about potential spring bonuses tied to hours. I really need the full year to meet my hours and can't count on doing so half-way through. I would MUCH rather have a guaranteed salary bump + sizeable EOY bonus (so long as the base salary keeps up with inflation).

Regulatory hours are more seasonal (i.e. not to busy at the start of the year, pick up at the end?)

In my group, early spring and December are slow. The rest of the year is better.

[Anonymous User]

So do we think one of the NYC big boys are going to come in and one-up Milbank like last time? DPW/CSM/Kirkland/Cleary/Debevoise/Skadden/insert-NYC-big-firm all had monster years and don't seem to be slowing down. There seems to be less noise about coming over the top this time around. Regardless, major props to Milbank for getting things moving once again...they are really making a statement.

K&E can't even give out top market bonuses anymore, no shot they come over the top. They might not even match!

This is silly (K&E will of course match) but people consistently do not understand Kirkland in comp threads. Kirkland is never, ever, ever going to set a new market - their niche is a reputation of BEATING the market on year-end bonuses (which have been declining and they are cheap misers, but they maintain that reputation) so it is in their interest to keep the rest of the market as low as possible and then just beat them.

[Anonymous User]

Delete

[Anonymous User]

Cravath partner meetings are Monday @ lunch, right? (According to TLS lore.) Does that mean we will likely see a match or raise from CSM as soon as this Monday? Or is everybody going to wait for DPW to do its thing.

[Anonymous User]

Cadwalader Saw Partner Profits Soar by 70% as Revenue Grew More Than 30% in 2021

Well this explains some things

Wow. I suppose that level of growth makes CWT an outlier (and the article specifically mentions they had a weak 2020 which enlarges these growth rates). But still, I wouldn’t be surprised to see many of the other firms that were hovering in the $4-5M PPEP range move into the $5-7M PPEP range.

Yeah, PPP at DPW/STB/PW/S&C/Kirkland will probably surpass $6 million year this year - maybe even $7 million. Who knows what Cravath is doing. They honestly should be keeping pace but they’re profit margin is for some reason consistently lower than their peers every year so probably $5-6 million. Fun question is whether Wachtell will go nuts and post something insane like $9 million lol. Crazy how much V10 partners are making rn…

[Anonymous User]

So do we think one of the NYC big boys are going to come in and one-up Milbank like last time? DPW/CSM/Kirkland/Cleary/Debevoise/Skadden/insert-NYC-big-firm all had monster years and don't seem to be slowing down. There seems to be less noise about coming over the top this time around. Regardless, major props to Milbank for getting things moving once again...they are really making a statement.

K&E can't even give out top market bonuses anymore, no shot they come over the top. They might not even match!

This is silly (K&E will of course match) but people consistently do not understand Kirkland in comp threads. Kirkland is never, ever, ever going to set a new market - their niche is a reputation of BEATING the market on year-end bonuses (which have been declining and they are cheap misers, but they maintain that reputation) so it is in their interest to keep the rest of the market as low as possible and then just beat them.

Right. Also, Kirkland’s primary focus is on winning the war for laterals, not new recruits. They shell out the big bucks to steal existing associates and partners that have already proven their profitability. They will always, always, always match market salary and go slightly above it for bonuses, but they will NEVER move first.

Talk to any Kirkland partner and they’ll say the same. They just have a different strategy.

[AureliusCapital]

Hey DPW, how are you today?

[Anonymous User]

Hey DPW, how are you today?

Quiet so far. My guess is that they are deciding whether to (1) announce bonuses (unlikely this early in the year, IMO), (2) true up (?) the pay raise to the beginning of the year and/or (3) go over the top.