When compensation pacesetter Cravath announced its modest 2010 bonus scheme for associates last month, partners throughout BigLaw breathed an audible sigh of relief—awarding 2009-level bonuses (despite a much improved year for most) means more cash for partners and lower expectations throughout the industry. Since the announcement, numerous BigLaw mainstays have agreed to match Cravath: Skadden, Proskauer Rose, Milbank, Willkie Farr, Weil, Kirkland & Ellis, MoFo—the list goes on. Surely the rest of the pack will follow suit in a matter of days.
But one modest firm, the likes of which Vault-surveyed attorneys said typically "flies under the radar," is threatening to buck that trend. According to a tipster on Above the Law, Cahill Gordon & Reindel is that dark horse. The source, who apparently sat in on a compensation committee meeting, suggested that associates could expect to receive "a multiple" of Cravath's bonus this winter. That’s right—not a match, not an improvement—a multiple.
Is Cahill, which endured a number of layoffs in 2009, really going to give its associates double, triple, quadruple what the rest of the industry is getting? For starters, if this tipster is to be trusted, the firm is planning to clandestinely hand out two sets of bonuses—one this month, one in January—in order to avoid the certain resentment on tap for any partnership who dares flout Cravath's tacit authority.
Of course, it's all speculation at this point. If recent history is to be considered, however, it's possible; the firm did hand out rare mid-year bonuses this summer while Cravath, Skadden, and the rest of the usual suspects remained tight-fisted.
So what's at play here? Is Cahill making a power-play to curry favor with associates, both current and future? After all, surveyed attorneys (both inside and outside Cahill) tell Vault that the firm has a reputation for "working their associates to the bone." Is the partnership simply recognizing the efforts of its overworked associates? Or is this just a good, old-fashioned headline grabber aimed squarely at the Class of 2010 and beyond?
Either way, you've got to like the underdog. Stay tuned.
UPDATE: Above the Law is now reporting that, according to a pair of new sources at the firm, Cahill's associate bonuses will indeed put Cravath—and the rest of the market—to shame. The sources suggest that all associates will receive bonuses between $15-20k this month, only to reap further reward in January on par with Cravath's one-time offering. Could it be true? Is Cahill Gordon & Reindel, as the folks at ATL put it, really "the new definition of competitive market salary in New York City"?
UPDATE UPDATE: According to a press release dated December 12, pocket-sized litigation specialists Susman Godfrey have smashed Cravath's bonus scale, besting even the upstart Cahill with some eye-opening numbers. Associate bonuses range from $45,000 to $100,000, the release reveals. Translation: the most junior Susman Godfrey associate is worth more than the most senior Cravath associate. Ouch.
For more information:
PR Newswire: Big Year Leads to Big Bonuses at Susman Godfrey
Above the Law
Above the Law
- Sam Reynolds
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