US Law Firm 2011 Bonus Season Begins
It’s that time of year again. The major players in the US legal market are starting to announce their 2011 year end associate lawyer bonuses. Whilst there has certainly been much optimism that there would be some sort of increase on last year’s levels to at least nearer 2008 (see below for comparison), it has not come as the greatest surprise that in fact bonuses so far appear to be the same as 2010.
As is the norm, Cravath Swaine & Moore was the first firm to announce associate bonuses, closely followed Skadden Arps Slate Meagher & Flom. The figures for both firms are:
2011 Scale
|
Class Year |
Bonus $ |
|
2010 |
7,500 |
|
2009 |
10,000 |
|
2008 |
15,000 |
|
2007 |
20,000 |
|
2006 |
25,000 |
|
2005 |
30,000 |
|
2004 |
37,500 |
In 2008, most firms (including Cravath) significantly dropped their bonuses across the board. Skadden was one of the few exceptions; it kept them at 2007 levels.
2008 Scale
|
Class Year |
Cravath Bonus $ |
Skadden Bonus $ |
|
2007 |
17,500 |
35,000 |
|
2006 |
20,000 |
40,000 |
|
2005 |
22,500 |
45,000 |
|
2004 |
25,000 |
50,000 |
|
2003 |
27,500 |
55,000 |
|
2002 |
30,000 |
60,000 |
|
2001 |
30,000 |
65,000 |
In 2007, the bonuses were significantly higher at Cravath and included (like most New York firms at the time) an additional “special bonus”
2007 Scale
|
Class Year |
Regular Bonus $ |
Special Bonus $ |
|
2006 |
35,000 |
10,000 |
|
2005 |
40,000 |
15,000 |
|
2004 |
45,000 |
20,000 |
|
2003 |
50,000 |
30,000 |
|
2002 |
55,000 |
40,000 |
|
2001 |
60,000 |
50,000 |
|
2000 |
65,000 |
50,000 |
There has only been a slight change in 2011 at the 7th year level (Class of 2004) which has increased by $2,500 from $35,000 to $37,500 which is likely in response to the fact that other firms paid this amount year to 7th year associates in 2010.
Looking at some of the comments on US legal news site Above The Law, it seems that there is still some vague hope that one or two of the other elite New York law firms may step in and break the mould, but from an outsiders perspective, this looks unlikely. It remains to be seen whether additional spring bonuses will be paid in 2012 as in 2011 (there has been no mention of them by either Cravath or Skadden), but that will likely depend on how the US and global economies fare over the coming months.
We expect to see further news of bonuses between now and the end of the year, although do not anticipate any major surprise moves away from the scale set by Cravath. Bearing in mind that base salaries in the US have remained virtually static since 2007 and taking into account lower bonuses and inflation, US lawyers are now earning significantly less in real terms in 2011 than 4 years ago.
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Update: Friday 2nd December
Milbank Tweed has now announced its bonuses and unsurprisingly they are on the same scale as Cravath and Skadden. The firm is however offering a bonus of $7500 to the Class of 2011, pro-rated to the length of time they have been with the firm. It's only a token amount, but every little helps.
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Update: Tuesday 6th December
Proskauer Rose is the latest firm to reveal its 2011 bonuses. Again they are matching the scale set by Cravath. Unlike Milbank however, there is no mention of any pro-rated bonuses to the Class of 2011.
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Update: Thursday 15th December
Sullivan & Cromwell have revealed their associate bonus scale. It is virtually the same as the Cravath scale, but with larger amounts for the most senior associates. It has also announced that it will pay a supplemental spring bonus in 2012, but has not as yet revealed any figures. Could this be the start of another spring bonus trend?
|
Class Year |
Bonus $ |
|
2010 |
7,500 |
|
2009 |
10,000 |
|
2008 |
15,000 |
|
2007 |
20,000 |
|
2006 |
25,000 |
|
2005 |
30,000 |
|
2004 |
37,500 |
| 2003+ | 42,500 |
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Update: Friday 16th December
A quick round up of who's doing what in the US bonus rounds.
Matching Cravath:
- Skadden
- Milbank (but with additional pro-rata bonuses for class of 2011)
- Proskauer Rose
- Weil Gotshal (which has also removed it’s “distinguished” bonus for top performers (this was announced last year))
- Kaye Scholer (plus they have given extra for the Spring Bonus they didn’t pay earlier in the year – no mention yet of Spring Bonus next year)
Matching Sullivan & Cromwell (but with no other mentions of spring bonus)
- Cleary Gottlieb (but with additional pro-rata bonuses for class of 2011)
- Debevoise & Plimpton
- Paul Weiss (but with additional pro-rata bonuses for class of 2011)
- Cadwalader Wickersham & Taft
- Davis Polk
- Simpson Thacher
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