Managing partners at small and mid-size firms aren’t anticipating a trickle-down effect on attorney compensation in the Boston market from BigLaw’s scramble to offer first-year associates annual salaries of $190,000 or more.
Instead, the consensus is that the smaller firms won’t feel the need to respond competitively to the pay bump enjoyed by associates at firms such as Ropes & Gray and WilmerHale, at least in the near term.
“The salary wars might be going on nationwide, but they’re going on at a certain altitude,” says John T. Morrier, managing partner at the 44-attorney Boston firm Casner & Edwards.
Recruitment and retention
Judy St. John, a recruiter with the associate practice group at Major, Lindsey & Africa’s Boston office, says she expects all the big firms in Boston at least to match the $190,000 starting salary for associates. Some firms are even spicing up job offers with signing or “early” bonuses, she says.
According to St. John, the increase in salary structures is due as much to the need to retain legal talent as it is to attract new talent.
“Firms are anxious to retain the talent that they already have,” she reports. “I get calls all the time from associates who are completely burned-out and want to go in-house or to a ‘life-style’ firm.”
While managing partners such as Morrier and Lando don’t see firms like their own being impacted by the new round of BigLaw salary increases, St. John is another legal recruiter who thinks that Boston-area boutiques and mid-sized firms may not be as immune as they think they are.
St. John foresees smaller and mid-sized firms struggling to compete for and retain talent as a result of the new BigLaw pay structures for one basic reason: supply and demand. She points out that law school applications are down, meaning the pool of candidates to fill openings is significantly smaller than what it has been.
“And associates are burning-out very quickly on both the corporate side and the IP side,” she says, adding that, overall, smaller firms are going to have a “big challenge on their hands.”
Recruiter Robert L. Zinn, who heads the partner practice group at MLA’s Boston office, says he doesn’t think there’s an “apples to apples” comparison when analyzing BigLaw’s pay scale impact on smaller firms.
“From the outset, [smaller firms] weren’t really in the running to attract the people who are going to be looking at potential $190,000-a-year salaries,” Zinn says.
Too much attention is being paid to the new salaries for first-year associates and not enough attention to the “domino effect” such pay increases mean for other associates at a firm, Zinn adds.
“Look at the total amount that just this one bump does to the entire associate community,” he says. “Where that money has to come from, whether it’s raising the capital contribution or simply more money out of the equity partner’s share, it’s not just those first-years that are making a dent in the bottom line; it’s the whole lineup. It’s impactful not just for the firms but most importantly for the clients.”
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