EOY Bonuses Forum

[Anonymous User]

Well it's not happening today, folks. Pack it in. Tomorrow's another day.

Historically, I think if not today, then next Monday. Don't quote me on that.

That sounds right and is what I'll go with. If I cared more I'd go back over the ATL tracker of announcement dates and see what date of the week they correspond with but don't have time. I'm guessing we get the announcement 11/28 before end of day although open to being surprised.

I feel like it's been weird in recent years though. I feel like last year Cravath announced on the Monday before/after Thanksgiving, with a flat bonus scale the same as the prior year, and then no other market-setting firm said anything for awhile, a handful of firms fell in line, TLS was outraged, and then like 3 weeks later DPW came over the top with the special bonus kickers.

Also don't quote me on that because I didn't fact check, but that's my recollection, but then the crazy salary wars happened right after in Jan/Feb so memory could be skewed by those too.

That sounds about right. The big deal last year was that the market froze as some debate (probably) happened within DPW, which revealed how DPW is now regarded as one of the necessary market setters.

It could happen again this year. Timing is everything. You need Cravath to kick things off. But then you need the combination of STB, Milbank, and DPW (especially) to weigh in before the market is fully “set.” The longer the delay between the former and the latter, the more likely something is brewing.

What is this nonsense about the market being "fully 'set''"? There's no such thing. If STB, Millbank, or DPW want to up the ante no amount of other firms matching something lower will stop them. In fact, it just makes them seem that much more important because other firms will have to scramble with some accounting voodoo just to pay out on time (or even late). But there's no doubt that if and when STB, Milbank, or DPW announces a raise/special bonus, other firms will follow, period. I do agree both as a matter of common sense and historical practice that delay past the normal announcement timeframe from the big bonus names tends to be a good thing.

Anyway, not that it's relevant to what these market-setting firms will actually consider, but for fun here's last year's base bonuses inflated by 7.7% (and rounded). Doesn't really feel like anything groundbreaking.
Y1 - $21,500 (from $20,000)
Y2 - $32,500 (from $30,000)
Y3 - $62,000 (from $57,500)
Y4 - $81,000 (from $75,000)
Y5 - $97,000 (from $90,000)
Y6 - $113,000 (from $105,000)
Y7 - $124,000 (from $115,000)

[Anonymous User]

Well it's not happening today, folks. Pack it in. Tomorrow's another day.

Historically, I think if not today, then next Monday. Don't quote me on that.

That sounds right and is what I'll go with. If I cared more I'd go back over the ATL tracker of announcement dates and see what date of the week they correspond with but don't have time. I'm guessing we get the announcement 11/28 before end of day although open to being surprised.

I feel like it's been weird in recent years though. I feel like last year Cravath announced on the Monday before/after Thanksgiving, with a flat bonus scale the same as the prior year, and then no other market-setting firm said anything for awhile, a handful of firms fell in line, TLS was outraged, and then like 3 weeks later DPW came over the top with the special bonus kickers.

Also don't quote me on that because I didn't fact check, but that's my recollection, but then the crazy salary wars happened right after in Jan/Feb so memory could be skewed by those too.

That sounds about right. The big deal last year was that the market froze as some debate (probably) happened within DPW, which revealed how DPW is now regarded as one of the necessary market setters.

It could happen again this year. Timing is everything. You need Cravath to kick things off. But then you need the combination of STB, Milbank, and DPW (especially) to weigh in before the market is fully “set.” The longer the delay between the former and the latter, the more likely something is brewing.

What is this nonsense about the market being "fully 'set''"? There's no such thing. If STB, Millbank, or DPW want to up the ante no amount of other firms matching something lower will stop them. In fact, it just makes them seem that much more important because other firms will have to scramble with some accounting voodoo just to pay out on time (or even late). But there's no doubt that if and when STB, Milbank, or DPW announces a raise/special bonus, other firms will follow, period. I do agree both as a matter of common sense and historical practice that delay past the normal announcement timeframe from the big bonus names tends to be a good thing.

Anyway, not that it's relevant to what these market-setting firms will actually consider, but for fun here's last year's base bonuses inflated by 7.7% (and rounded). Doesn't really feel like anything groundbreaking.
Y1 - $21,500 (from $20,000)
Y2 - $32,500 (from $30,000)
Y3 - $62,000 (from $57,500)
Y4 - $81,000 (from $75,000)
Y5 - $97,000 (from $90,000)
Y6 - $113,000 (from $105,000)
Y7 - $124,000 (from $115,000)

You read my post too quickly. I said the market isn’t set until we hear from (at least) Cravath STB DPW Milbank. I think everyone recognizes this. Baker’s best service this year was to establish a floor.

[Anonymous User]

Well it's not happening today, folks. Pack it in. Tomorrow's another day.

Historically, I think if not today, then next Monday. Don't quote me on that.

That sounds right and is what I'll go with. If I cared more I'd go back over the ATL tracker of announcement dates and see what date of the week they correspond with but don't have time. I'm guessing we get the announcement 11/28 before end of day although open to being surprised.

I feel like it's been weird in recent years though. I feel like last year Cravath announced on the Monday before/after Thanksgiving, with a flat bonus scale the same as the prior year, and then no other market-setting firm said anything for awhile, a handful of firms fell in line, TLS was outraged, and then like 3 weeks later DPW came over the top with the special bonus kickers.

Also don't quote me on that because I didn't fact check, but that's my recollection, but then the crazy salary wars happened right after in Jan/Feb so memory could be skewed by those too.

That sounds about right. The big deal last year was that the market froze as some debate (probably) happened within DPW, which revealed how DPW is now regarded as one of the necessary market setters.

It could happen again this year. Timing is everything. You need Cravath to kick things off. But then you need the combination of STB, Milbank, and DPW (especially) to weigh in before the market is fully “set.” The longer the delay between the former and the latter, the more likely something is brewing.

What is this nonsense about the market being "fully 'set''"? There's no such thing. If STB, Millbank, or DPW want to up the ante no amount of other firms matching something lower will stop them. In fact, it just makes them seem that much more important because other firms will have to scramble with some accounting voodoo just to pay out on time (or even late). But there's no doubt that if and when STB, Milbank, or DPW announces a raise/special bonus, other firms will follow, period. I do agree both as a matter of common sense and historical practice that delay past the normal announcement timeframe from the big bonus names tends to be a good thing.

Anyway, not that it's relevant to what these market-setting firms will actually consider, but for fun here's last year's base bonuses inflated by 7.7% (and rounded). Doesn't really feel like anything groundbreaking.
Y1 - $21,500 (from $20,000)
Y2 - $32,500 (from $30,000)
Y3 - $62,000 (from $57,500)
Y4 - $81,000 (from $75,000)
Y5 - $97,000 (from $90,000)
Y6 - $113,000 (from $105,000)
Y7 - $124,000 (from $115,000)

You read my post too quickly. I said the market isn’t set until we hear from (at least) Cravath STB DPW Milbank. I think everyone recognizes this. Baker’s best service this year was to establish a floor.

Ahh sorry bud. Good points, then.

[Anonymous User]

Agree it would be totally unprecedented for any of CSM DPW or others to now announce below Baker (the last time this happened was to Skadden in 2008 iirc and that was a BIG deal).

I am hoping for last year's DPW scale, which is what Baker announced plus a small kicker. What I'm dreaming for is higher than that so that this year's 7th years make at least as much as last year's 7th years accounting for all the special bonuses last year and the big raise this year. That's actually only a $1,500 difference so doesn't matter either way.

For reference, last year's 7th years made 539,500 all in. If we get DPW's kicker this year, 7th years will make 538,000 (400 base plus 115 plus 23 kicker).

[Anonymous User]

Agree it would be totally unprecedented for any of CSM DPW or others to now announce below Baker (the last time this happened was to Skadden in 2008 iirc and that was a BIG deal).

I am hoping for last year's DPW scale, which is what Baker announced plus a small kicker. What I'm dreaming for is higher than that so that this year's 7th years make at least as much as last year's 7th years accounting for all the special bonuses last year and the big raise this year. That's actually only a $1,500 difference so doesn't matter either way.

For reference, last year's 7th years made 539,500 all in. If we get DPW's kicker this year, 7th years will make 538,000 (400 base plus 115 plus 23 kicker).

Do you have time to run this out for all years? Never thought about the raise this year as solidifying a good chunk of the special bonuses from last year.

[Anonymous User]

Today is the day folks. DPW to raise.

[Anonymous User]

Today is the day folks. DPW to raise.

Inside scoop or just wishcasting?

[Anonymous User]

Agree it would be totally unprecedented for any of CSM DPW or others to now announce below Baker (the last time this happened was to Skadden in 2008 iirc and that was a BIG deal).

I am hoping for last year's DPW scale, which is what Baker announced plus a small kicker. What I'm dreaming for is higher than that so that this year's 7th years make at least as much as last year's 7th years accounting for all the special bonuses last year and the big raise this year. That's actually only a $1,500 difference so doesn't matter either way.

For reference, last year's 7th years made 539,500 all in. If we get DPW's kicker this year, 7th years will make 538,000 (400 base plus 115 plus 23 kicker).

Do you have time to run this out for all years? Never thought about the raise this year as solidifying a good chunk of the special bonuses from last year.

This website makes it easy (especially as salary bumps were as of Jan 1):
https://www.biglawinvestor.com/biglaw-salary-scale/

If I were a betting person, I'd say total comp (including salary, bonus and special bonuses) would be more or less flat between 2021 and 2022. That would mean the following increase above Baker:

Class year 2021 TC Baker 2022 TC Difference
1st Year $233,500 $235,000 $(1,500)
2nd Year $259,500 $255,000 $4,500
3rd Year $331,000 $307,500 $23,500
4th Year $399,000 $370,000 $29,000
5th Year $452,500 $435,000 $17,500
6th Year $502,700 $475,000 $27,700
7th Year $539,500 $515,000 $24,500
8th Year $554,500 $530,000 $24,500

[Anonymous User]

Today is the day folks. DPW to raise.

Inside scoop or just wishcasting?

It raises an interesting question about timing. The sort of expectation is Cravath is going to announce within the next week or so and then DPW or Milbank is going to come in like a big swinging dick and raise Cravath to finalize "the market," at which point everyone in the V50 will match (or re-match in the case of Cravath). The question is, is Cravath comfortable playing that role or is its partnership getting tired of being second fiddle to DPW and Milbank which might force a game of chicken. Law firms tend to be basically conservative so odds on Cravath just does its thing but you do wonder after two successive years of Cravath being "beaten" by competitor firms. Another option for Cravath would be to keep timing as is but definitively raise the scale in a way that causes the rest of the competition to give up trying to best it and just match.

[Anonymous User]

Today is the day folks. DPW to raise.

Inside scoop or just wishcasting?

It raises an interesting question about timing. The sort of expectation is Cravath is going to announce within the next week or so and then DPW or Milbank is going to come in like a big swinging dick and raise Cravath to finalize "the market," at which point everyone in the V50 will match (or re-match in the case of Cravath). The question is, is Cravath comfortable playing that role or is its partnership getting tired of being second fiddle to DPW and Milbank which might force a game of chicken. Law firms tend to be basically conservative so odds on Cravath just does its thing but you do wonder after two successive years of Cravath being "beaten" by competitor firms. Another option for Cravath would be to keep timing as is but definitively raise the scale in a way that causes the rest of the competition to give up trying to best it and just match.

To be fair, I think Cravath still maintains its status as a comp leader even if others come over the top. To me it just suggests that others need to talk louder to try to be in the same league as Cravath. Now someone raising BEFORE Cravath would put them in an interesting spot.

[RedNewJersey]

If I were a betting person, I'd say total comp (including salary, bonus and special bonuses) would be more or less flat between 2021 and 2022.

This seems quite optimistic to me. I basically think of raises as market-driven, i.e., firms give raises if they think it will put them in a better position to attract profit-increasing talent. You need to raise associate compensation if firms want more associates, and are losing them (either to each other, or another employment sector). Last year, firms wanted more associates, but were losing them to other firms and the options were pretty good in other sectors (banking, tech, etc.). So, they gave special bonuses. It helped that partners were making more. This year, firms do not want more associates. And they are not losing associates to other firms. And banking, tech, etc. are less attractive options too.

So, I doubt they will pay more than the minimum necessary to retain who they have. To me, that means flat annual bonuses with no special bonus.

[Anonymous User]

If I were a betting person, I'd say total comp (including salary, bonus and special bonuses) would be more or less flat between 2021 and 2022.

This seems quite optimistic to me. I basically think of raises as market-driven, i.e., firms give raises if they think it will put them in a better position to attract profit-increasing talent. You need to raise associate compensation if firms want more associates, and are losing them (either to each other, or another employment sector). Last year, firms wanted more associates, but were losing them to other firms and the options were pretty good in other sectors (banking, tech, etc.). So, they gave special bonuses. It helped that partners were making more. This year, firms do not want more associates. And they are not losing associates to other firms. And banking, tech, etc. are less attractive options too.

So, I doubt they will pay more than the minimum necessary to retain who they have. To me, that means flat annual bonuses with no special bonus.

Weirdly enough (but here we are) the strongest counter to the idea of flat bonuses to me has become the fact that Baker once again is trying to set the market. Do we really think that, among the group of STB, Milbank, Cravath, and DPW, particularly given how aggressive they've become with compensation since COVID, that they're all going to settle with matching the "Baker Scale" this year? Happy to be quoted a month from now if I'm wrong but even if it's just a marginal, one-upsmanship move, hard to imagine that at least one of the four won't break and e.g., sweeten the scale by 5k/10k/15k -- something to claim the market lead.

[Monochromatic Oeuvre]

To be fair, I think Cravath still maintains its status as a comp leader even if others come over the top. To me it just suggests that others need to talk louder to try to be in the same league as Cravath. Now someone raising BEFORE Cravath would put them in an interesting spot.

Whoever sets the scale is the namesake of the scale. If Cravath merely matches Baker, it remains the Baker Scale, although I would accept the Faiza Saeed Salty Tears Scale.

[Anonymous User]

To be fair, I think Cravath still maintains its status as a comp leader even if others come over the top. To me it just suggests that others need to talk louder to try to be in the same league as Cravath. Now someone raising BEFORE Cravath would put them in an interesting spot.

Whoever sets the scale is the namesake of the scale. If Cravath merely matches Baker, it remains the Baker Scale, although I would accept the Faiza Saeed Salty Tears Scale.

+1 This bullshit idea that "Cravath leads because ... Cravath" needs to go away (and has gone away, right, based on their getting styled on the past two years by DPW and Milbank).

[Anonymous User]

To be fair, I think Cravath still maintains its status as a comp leader even if others come over the top. To me it just suggests that others need to talk louder to try to be in the same league as Cravath. Now someone raising BEFORE Cravath would put them in an interesting spot.

Whoever sets the scale is the namesake of the scale. If Cravath merely matches Baker, it remains the Baker Scale, although I would accept the Faiza Saeed Salty Tears Scale.

+1 This bullshit idea that "Cravath leads because ... Cravath" needs to go away (and has gone away, right, based on their getting styled on the past two years by DPW and Milbank).

That's not at all what I was saying. I agree with the above re naming the scale. What I was trying to sayis IF Cravath raises and THEN DPW raises over the top, Cravath still gets credit for being a comp leader (pusher?) even if it ends up being called the DPW scale.

That's in our interest as associates because it affords goodwill to firms that up the ante even if they don't end up with the last word. It's bad for us if Cravath stops raising comp because they know DPW/STB/Milbank might raise over top - we want a bidding war with as many participants as possible.

[Anonymous User]

Hold fast folks. Hearing that DPW - STB are handing cash to senior associates or “fake partners” to stop the bleeding. Likely they give us loyalists a flat bonus

[Anonymous User]

If I were a betting person, I'd say total comp (including salary, bonus and special bonuses) would be more or less flat between 2021 and 2022.

This seems quite optimistic to me. I basically think of raises as market-driven, i.e., firms give raises if they think it will put them in a better position to attract profit-increasing talent. You need to raise associate compensation if firms want more associates, and are losing them (either to each other, or another employment sector). Last year, firms wanted more associates, but were losing them to other firms and the options were pretty good in other sectors (banking, tech, etc.). So, they gave special bonuses. It helped that partners were making more. This year, firms do not want more associates. And they are not losing associates to other firms. And banking, tech, etc. are less attractive options too.

So, I doubt they will pay more than the minimum necessary to retain who they have. To me, that means flat annual bonuses with no special bonus.

If this is the case why pay the same annual bonus as last year at all? Why not go back to the pre-pandemic scale?

[RedNewJersey]

If this is the case why pay the same annual bonus as last year at all? Why not go back to the pre-pandemic scale?

"Sticky wages," i.e., the same reason companies across virtually every sector of the economy opt for layoffs rather than pay reductions: employees have strong loss-aversion, and would be demoralized by a nominal pay cut.

[Anonymous User]

Hold fast folks. Hearing that DPW - STB are handing cash to senior associates or “fake partners” to stop the bleeding. Likely they give us loyalists a flat bonus

Not a fan of these secret bonuses. It just means firms not paying them are effectively paying beneath market.

[LittleRedCorvette]

Hold fast folks. Hearing that DPW - STB are handing cash to senior associates or “fake partners” to stop the bleeding. Likely they give us loyalists a flat bonus

Is there bleeding right now?

[Anonymous User]

At my V5 the only bleeding amongst seniors is people who’ve been asked to leave in the past few months. Not a great posture for bonuses.

[Anonymizer]

Bleeding is limited and overblown. The idea certain groups were driving record profits so they have an outsized importance is not at odds with firms still being profitable. Economic headwinds notwithstanding, many groups, even those that rightsized following pandemic boomtimes, are objectively busy enough for their firm to continue making partners wealthy. This is even after accounting for increased expenses, RTO and higher wages. The bleeding narrative seems like bullshit fearmongering to corral upstart associates and not share the wealth.

[Anonymous User]

Don’t forget that special bonuses were already baked into the revised salary scale from the start of the year. This suggests bonuses will remain flat (no add’l special).

[Anonymous User]

Don’t forget that special bonuses were already baked into the revised salary scale from the start of the year. This suggests bonuses will remain flat (no add’l special).

What?! The way some people contort thinking around here is so odd it makes me wonder if there aren't partner plants lurking. The special bonuses were the special bonuses. The scale increase was the scale increase. I think very few people regard the periodic increase in the biglaw salary scale as the equivalent of "baking in" a special bonus.

[Anonymous User]

Don’t forget that special bonuses were already baked into the revised salary scale from the start of the year. This suggests bonuses will remain flat (no add’l special).

What?! The way some people contort thinking around here is so odd it makes me wonder if there aren't partner plants lurking. The special bonuses were the special bonuses. The scale increase was the scale increase. I think very few people regard the periodic increase in the biglaw salary scale as the equivalent of "baking in" a special bonus.

I guarantee there are partners from non market leader firms trying to influence online discussion. Have a look at the arguments being made on Reddit biglaw. There also seems to be a bot army upvoting the notion that simply holding onto your job is enough of a bonus.