In a recession, who gets laid off first? Forum

[Anonymous User]

I hope you’re right - but the fact that they came back from it cuts the other way. LW is one of, if not the, most sought after firm(s) in non-NY markets and especially CA…

You can be sought after and still have a reputation problem. See, e.g., CSM and K&E. Tons of my law school classmates (c/o 2017) excluded Latham from their bid list (or declined an offer) because of Latham's recession shenanigans. While Latham is certainly doing fine despite that, many other firms would be worried that they wouldn't have that luxury. Besides, I don't think law firms are built culturally for systematic layoffs. Anecdotally, my firm consistently says when business is slow that's a partner problem, not an associate problem.

But you don't have to drink that Kool-Aid to agree with me. Take a step back. Latham was an outlier even in '08. Given that the term "Lathaming" has persisted for more than a decade, I don't think law firms will be clamoring to make ATL headlines by cleaning house. I'm not saying nobody will Latham associates come a recession - someone is bound to make that mistake. I'm just saying that it will be rare like it was last time.

I'll caveat this with the fact that law firms more than ever have become profit maximizers above all else. I see an argument that '08 changed the business, and it's more likely to trim the fat to preserve profits come the next downturn.

[Anonymous User]

I reckon it depends on your group and its culture. I began my career with a British magic circle firm in London. Back in 2015, they asked almost all the senior associates to leave because they had no partnership prospects. Granted none of them were fired, but their lives were made difficult if they didn’t leave promptly. There was no economic motivation for the decision other than the partners wanted a younger age profile. Nothing was raised in the legal press despite the group having close to 100 attorneys working in it.

[Anonymous User]

I reckon it depends on your group and its culture. I began my career with a British magic circle firm in London. Back in 2015, they asked almost all the senior associates to leave because they had no partnership prospects. Granted none of them were fired, but their lives were made difficult if they didn’t leave promptly. There was no economic motivation for the decision other than the partners wanted a younger age profile. Nothing was raised in the legal press despite the group having close to 100 attorneys working in it.

This sounds really bad!

[Anonymous User]

I hope you’re right - but the fact that they came back from it cuts the other way. LW is one of, if not the, most sought after firm(s) in non-NY markets and especially CA…

But you don't have to drink that Kool-Aid to agree with me. Take a step back. Latham was an outlier even in '08. Given that the term "Lathaming" has persisted for more than a decade, I don't think law firms will be clamoring to make ATL headlines by cleaning house. I'm not saying nobody will Latham associates come a recession - someone is bound to make that mistake. I'm just saying that it will be rare like it was last time.

This is a bit of a misleading take, IMO. Latham did it publicly, as did a couple of other firms, but pretty much everyone except Wachtell-tier firms were engaging in large stealth layoffs. Latham gets a bad rap, and deservedly so because they unapologetically nuked a bunch of first years’ careers, but they were far from an outlier, except that they were one of the first and they made it public (and, for what it’s worth, I believe the first round of Lathamings came with pretty generous severance, something that became far less common from firms as the financial crisis dragged on). At least that is what I recall from being active in various legal forums / blogs in the immediate aftermath of the financial crisis. It’s been a while, and luckily my OCI came a tad after the worst of the worst was over.

[person237]

Anyone have any insight into the effects on government attorneys (state or fed)? Lol I know that it’s gonna depend on a lot of factors, but I recall hearing of furloughs at state agencies.

[Anonymous User]

Anyone have any insight into the effects on government attorneys (state or fed)? Lol I know that it’s gonna depend on a lot of factors, but I recall hearing of furloughs at state agencies.

I haven't heard of furloughs in state agencies, though that could just be me and who I know. Feds get furloughed when Congress can't pass a budget.

[TatteredDignity]

Those that tried to ride the big law train and put in minimum effort last couple years based on the fact that the firm needed bodies are in for a treat because I think real reviews are back and we don’t forget

This post exudes some of the dweebiest energy I've ever encountered

It's kind of breathtaking.

edit: whoops, accidental anon, this is nixy

I'll put a slightly different spin on original anon's take. I don't begrudge people who want to coast (you do you! the job ain't for everyone), but it doesn't mean I have to staff them on my cases, and I don't forget who they are. I'm not gonna try to tank their career or anything though.

[Anonymous User]

I reckon it depends on your group and its culture. I began my career with a British magic circle firm in London. Back in 2015, they asked almost all the senior associates to leave because they had no partnership prospects. Granted none of them were fired, but their lives were made difficult if they didn’t leave promptly. There was no economic motivation for the decision other than the partners wanted a younger age profile. Nothing was raised in the legal press despite the group having close to 100 attorneys working in it.

Did they do anything to set them up at other places? E.g., I've heard that at Slaughter and May, it's not uncommon to see senior associates who aren't going to make it go to Macfarlanes on a short-term promise, etc. (Used to be more common at firms in New York, too, from what I understand - giving someone a counsel title on the understanding that it'll help a job search, trying to place them in house, etc.)

[nealric]

Anyone have any insight into the effects on government attorneys (state or fed)? Lol I know that it’s gonna depend on a lot of factors, but I recall hearing of furloughs at state agencies.

I haven't heard of furloughs in state agencies, though that could just be me and who I know. Feds get furloughed when Congress can't pass a budget.

With the Feds, it seems the more common thing is long periods of hiring freezes. There was a time between 2009 and about 2014 where it was almost impossible to get hired by the federal government. But you aren't going to be fired for mediocre performance. Poor performing federal government workers usually just get staffed on lower profile and less interesting matters rather than being shown the door.

State and local agencies are more likely to have layoffs since state/local governments can't deficit spend like the feds and can run up against hard spending limits. But a layoff is probably still much less likely than in the private sector.

[Anonymous User]

I hope you’re right - but the fact that they came back from it cuts the other way. LW is one of, if not the, most sought after firm(s) in non-NY markets and especially CA…

But you don't have to drink that Kool-Aid to agree with me. Take a step back. Latham was an outlier even in '08. Given that the term "Lathaming" has persisted for more than a decade, I don't think law firms will be clamoring to make ATL headlines by cleaning house. I'm not saying nobody will Latham associates come a recession - someone is bound to make that mistake. I'm just saying that it will be rare like it was last time.

This is a bit of a misleading take, IMO. Latham did it publicly, as did a couple of other firms, but pretty much everyone except Wachtell-tier firms were engaging in large stealth layoffs. Latham gets a bad rap, and deservedly so because they unapologetically nuked a bunch of first years’ careers, but they were far from an outlier, except that they were one of the first and they made it public (and, for what it’s worth, I believe the first round of Lathamings came with pretty generous severance, something that became far less common from firms as the financial crisis dragged on). At least that is what I recall from being active in various legal forums / blogs in the immediate aftermath of the financial crisis. It’s been a while, and luckily my OCI came a tad after the worst of the worst was over.

This is a total whitewash of what Latham did. Most firms didn't engage in behavior to the extent or in the manner that Latham did. There was in fact just a post about this by a user who crunched the numbers and it bears out. Latham was among only a handful of biglaw firms that laid off at the level it did percentagewise, and absolute numbers wise it was probably the leader. Latham's firings were also particularly vicious in that it targeted their young, newly hired attorneys which can spell career destruction.

[Helicopter]

I cancelled a callback with Latham because I saw what they did a number of years ago and their semi-response to Covid.

I still do not trust Latham and the fact that so many attorneys still rank them high enough to be a top vault firm is wild to me.

[nealric]

I cancelled a callback with Latham because I saw what they did a number of years ago and their semi-response to Covid.

I still do not trust Latham and the fact that so many attorneys still rank them high enough to be a top vault firm is wild to me.

Keep in mind that Vault isn't supposed to be a ranking of good places to work, or places that are fair to their employees. As long as PPP stays high and they keep getting high-end matters, they are likely to stay high in Vault.

[Anonymous User]

I cancelled a callback with Latham because I saw what they did a number of years ago and their semi-response to Covid.

I still do not trust Latham and the fact that so many attorneys still rank them high enough to be a top vault firm is wild to me.

I'm currently at Latham and am curious what you are referring to by "semi-response to Covid" as there is nothing I'm aware of unique to Latham and if anything we have had the loosest in office demand among any of the firms that my friends work at.

Recognizing my bias, Latham is likely one of the firms to do whatever it can to not let anyone go because they recognize the impact that still has on recruiting today. If they weather a swell of firings, then they'll come out better on the other side. We have associates at all end of the spectrum (junior through senior) who are generally incompetent in my practice group (one that is not known for its intellectual rigor) and who the partners question how they're still working here when speaking privately but those same partners also note that no one is getting fired because of reputational concern and they'd rather have the bodies around for when work comes back.