Pay Cuts, Layoffs, and Extra: How Legislation Corporations Are Managing the Pandemic

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Pay Cuts, Layoffs, and More: How Law Firms Are Managing the Pandemic

Commuters on the Washington, DC Metro. Photo: Diego M. Radzinschi / ALM

Major law firms have taken drastic measures to mitigate the economic impact of the coronavirus pandemic and recession. Some companies have withdrawn their wage cuts. We will continue to update these events as the crisis progresses.

Akerman

Akerman cut wages and layoffs.

Scott Meyers, Chairman and CEO, said the Florida-based Am Law 100 firm plans to "control costs by reducing compensation payments at all levels of the firm and changing the size of our workforce." A company spokesman said in an email in April that the downsizing affected less than 5% of the company's employees.

According to the company, the draws for most partners, consultants and consultants are reduced by 12.5% ​​on an annual basis, while some partners reduce the draws on an annual basis by 17.5% "with a different compensation agreement". In addition, employee compensation is reduced by 7.5%, employees with an annual salary of $ 150,000 or more receive a 7.5% wage reduction, and employees with an annual salary of less than $ 150,000 receive a 5% reduction. All of these cuts are also made on an annual basis.

Allen & Overy

Allen & Overy has asked partners to raise capital as they take measures to protect themselves financially. Magic Circle is making a cash call and gradually reducing its partners' payouts, it confirmed on March 31. It has also frozen the payment of its employees and support staff, which means that it will not be running annual salary reviews scheduled to take place in the first quarter of the coming fiscal year. In the meantime, the premiums to be paid to earners and executives in July are split into two payments. Half is paid in July, the other half in October. The non-debt company has also postponed certain hires and canceled several events, a spokesman said in a statement.

Arent Fox

The company, based in Washington, DC, did Cost-cutting measures Including 25% wage cuts for employees and employees and 60% reduction in distributions from equity partners in accordance with above the law. In response to the economic slowdown, a firm spokesman said Arent Fox had "temporarily cut wages for all lawyers, professionals, and employees."

Baker Botts

On April 27, the firm announced that it would impose temporary wage cuts on lawyers and employees earning more than $ 70,000, but no layoffs or vacation days. According to a memo sent by managing partner John Martin to the company, the partners have agreed to cut remuneration "to absorb most of the financial impact". For a period of three months from May 1, the company will reduce attorney salaries by 20% to 30% based on their salary level, 20% for employees and up to 25% for employees. The temporary wage cuts will not affect employees who earn less than $ 70,000 a year.

In addition, the company has postponed the launch date for its incoming class of employees to 2021. In the meantime, the company may receive interim awards, according to the email, to exceptional contributors based on both individual performance and economic and corporate conditions.

The company will postpone the start of its 2020 summer program by at least one month. The company expects to host an online summer training program, and the company will offer deals for all employees in the summer, depending on maintaining strong academic performance.

In an internal email on July 29, Baker Botts' managing partner, John Martin, announced that the company plans to reinstate 50% of the compensation cuts that took effect on May 1, effective September 1. The company also announced plans to pay interim premiums to non-partners timekeepers who made “exceptional contributions” for the period May 1 through July 31.

Baker, Donelson, Bearman, Caldwell & Berkowitz

Baker Donelson has temporarily cut shareholder draws and salaries to weather the crisis. It announced on April 1 that it would make another temporary cut in wages across the company. According to a company statement, some employees will be on vacation "in the next few weeks". A spokesman for Baker Donelson said in an email that the temporary wage cuts will be 20% across the board and that vacation days will affect "less than 4% of the company's total workforce".

Baker & Hostetler

The firm said on May 7 that it will cut compensation for lawyers and employees. The annual remuneration for partners is reduced by 15% to 20%, for employees and employees by 10%. The adjustments can remain for 2020. The company added that it will not fire any employees. The base salary for the company's employees will not fall below a lower limit of $ 70,000 or $ 80,000, depending on the market. Administrative assistants and employees also have the option of creating a reduced work schedule instead of the 10% cut in wages. In addition, the company is shortening its summer employee program to four weeks and will be holding it remotely. The remuneration is based on the four weeks in which employees work for the company.

Baker & McKenzie

Baker McKenzie said on April 13 that it cuts salaries for all non-partner lawyers, other timekeepers, and business people in the US by 15%. The salary cuts will not affect people who earn less than $ 100,000, and no one will see their pay cut below that threshold. The company said the partners will also see cuts, although it offered details other than noting that the equity partners would see bigger reductions than everyone else in the company.

In Australia, Baker & McKenzie has not made any cuts so far, but has increased the work flexibility of employees to help them perform their duties to care for other members of their household, especially for those with young children, as schools and daycare centers are closed and the centers Homeschooling requirements. Voluntary options include the possibility to adjust working hours, shorten working hours and take up supervisors or take annual / long official leave.

Canadian attorneys, timekeepers, and business people will have their salaries reduced by 10%. The company has an office in Toronto. Local guidelines and regulations prevent any reduction in Mexico, where the company has five offices.

Ballard Spahr

According to a company spokesman, the firm cuts wages for employees by 10% for those who earn between $ 75,000 and $ 250,000 a year, and by 15% for those who earn more than $ 250,000 a year. The number of partners will be reduced by 20% to 25%, the spokesman said. Employees and lawyers who earn less than $ 75,000 will not be cut.

"We made the difficult decision to take painful but necessary cost-cutting measures in the hope that the company would be better positioned if the situation improved," said Chairman Mark Stewart. "We hope to avoid layoffs and to stay as busy as before to guide our customers through this turmoil and back to normal as quickly as possible."

Barclay Damon

The firm lowered wages for employees, lawyers and partners, which were reduced from at least 25% for equity partners to 15% for employees and employees in order to improve cash flow.

Empty Rome

Empty Rome took some employees on leave, but didn't do the same with any lawyer, the firm confirmed on April 3. In addition, on April 7, the law firm confirmed in a statement: "We are introducing a temporary 15% reduction in compensation across the law firm shared by our partners, employees, consultants, professionals and assistants, and temporarily a small number employees and other measures to reduce operating costs. "

Bryan Cave Leighton Paisner

The transatlantic law firm with 1,400 lawyers will postpone "parts of the partner distributions as the first line of defense" in the coming months, according to a statement by the law firm leaders on April 8. Bryan Cave Leighton Paisner aims to cut wages by 15% "for all employees in all offices" over a period of 13 weeks from May. Employees who earn less than $ 40,000 will not see a cut.

In June, the firm cut the salaries of its newly qualified London-based lawyers by 2.5%. The company has also taken leave of some of its legal assistants and legal assistants.

On July 15, Law.com reported that Bryan Cave was planning to cut attorneys and staff across the firm while the small base in Beijing, which houses a partner and two employees, was closed. While the company would not confirm the number of layoffs worldwide, 40 people in London were affected, including 14 earners and 26 business services employees. However, the wage cuts that the company made earlier this year will be cut to just 7.5%, but will remain the same for the rest of the year. According to a firm statement, the new wage cut will run from August to the end of 2020.

Buchanan Ingersoll & Rooney

CEO Joseph Dougherty said in a statement that Buchanan had temporarily adjusted remuneration at all levels and "given a very limited number of administrative staff" leave to bring them back "when the pandemic subsides".

Cadwalader, Wickersham & Taft

Cadwalader said in a firm memo dated March 31 that it will stop paying partners, cut employee salaries by 25%, and cut wages by 10% to 25% in response to the coronavirus crisis and its impact on the economy. will impose.

In a company memo dated July 29, managing partner Patrick Quinn announced with effect from August 1 that the law firm wanted to reverse the 25% and 10% cut in remuneration for employees, special advisers, lawyers, senior lawyers, lawyers, legal assistant and administrative staff Forward. "The return to full pay begins with your first paycheck in August," he wrote. The company confirmed that partner distributions will also normalize again.

Cahill Gordon & Reindel

The New York-based company announced on April 7 that it would suspend its summer associate program, but after graduation in 2021 would offer jobs to prospective students and continue to pay 30 summer employees "in full for the summer." Cahill's statement said that it would give the class the opportunity to remotely help with the company's pro bono work in the summer, and if the risks are so small that personal work becomes possible, it would “find appropriate ways "To resume the program for" some "part of the summer. "

Clark Hill

Detroit-based Clark Hill has initiated cost-cutting measures, including lowering wages for attorneys and employees, freezing discretionary spending, and revising certain benefits. This emerges from a statement by the firm on April 2. The company has also taken some employees on leave.

"We hope that this will be a temporary measure, and we believe that we will be able to review these difficult decisions again during the global health and economic crisis," a spokesman said in the statement.

Clayton Utz

The Australian law firm Clayton Utz has introduced a hiring freeze and will consider reducing working hours if economic conditions deteriorate.

Cozen O’Connor

According to CEO Michael Heller, the company asked the equity partners to postpone part of their compensation between 10% and 20% at the end of the year. The company has less than 5% of its administrative staff on leave, whose tasks could not be performed remotely. According to Heller, these employees will continue to be covered by the company and will eventually receive 100% of their compensation under the CARES law. He said the firm's goal was to avoid layoffs or cut wages for lawyers and employees.

In a statement dated May 13, the company said it had taken a further 5% of its administrative staff on leave until July 31, "given the seemingly slow and methodical transition back to an office environment during the summer and the reduced need for administrative support when working remotely. “The statement added that Cozen O’Connor pays 100% of the health benefits of these employees during this period and enables them to keep their PTO. "We do not expect additional vacation days," said the company.

In a July email, Heller said the company would start paying the partners back in full on July 1st. However, Heller did not return a message asking for an additional comment on the status of the employee on leave.

Crowell & Moring

The firm announced on April 15 that it would reduce lawyers and some professional staff wages by 5% to 25%. Philip Inglima, chairman of the company, said the equity partners will cut the remuneration by 25%, the income partners will cut the 20% and the employees and lawyers will cut the 15%. Employees who earn more than $ 100,000 – about a third of the company's employees – are also paid 5% to 20%, he said. He said the cuts are temporary and the company expects to lift them by the end of the year, depending on the impact of the pandemic.

Curtis, Mallet-Prevost, Colt & Mosle

The firm cut its employees' salaries by 25%, Above the Law reported on April 1. A Curtis spokesman said in an email to Law.com that the firm "is taking some similar steps to other law firms in response to COVID-19."

Davidoff Hutcher & Citron

The mid-sized law firm based in New York City submitted a WARNING announcing that the coronavirus had fired 34 people due to the effects of the coronavirus. Jeffrey Citron, the company's co-managing partner, said the company fired its secretarial and back office staff, described the move as "preventive," and compared it to "playing defense" in a phone call on April 14. He said the company hoped to recruit when the circumstances improve.

"It was very difficult to let the secretaries work and not be in the office," he said. While the firm's lawyers "all have laptops and most lawyers have computer skills," it is more difficult to adapt the work of support personnel to the constraints of the pandemic.

Davis & Gilbert

This medium-sized law firm in NYC lowers wages for partners, employees and employees. For a number of partners, the company significantly reduced the base drawing amounts so that all partners now have the same base drawing amount. The company temporarily limits partner distributions to 75% of this base amount. And it is planned to postpone the distribution in midsummer if the partners usually receive an advance on their profit allocations at the end of the year.

Salaries for employees, senior lawyers and attorneys have been reduced by 15%. Employee and manager salaries for those earning more than $ 150,000 a year have been reduced by 15%. and the company cuts salaries by 10% for those who earn between $ 70,000 and $ 150,000. All salary cuts will apply from May 4th. Salaries below $ 70,000 per year are not adjusted.

Davis Wright Tremaine

The firm is taking a number of measures, including reducing quarterly distributions from equity partners with the expectation that total equity partner compensation will be at least 25% below budget by 2020. For lawyers and employees, payment is reduced from May 1 to the end of the year. The cuts are 15% for contractors; 12% for employees, lawyers and attorneys; 15% for managers at C level; and 6-10% for employees based on salary levels, with no reduction below $ 60,000.

Around 8% of employees will be on leave "to adjust to workflows that have been disrupted or reduced due to lower demand" and the schedule will be reduced for a small number of employees. These employees continue to benefit from the company.

The company shortens its employee summer program to six weeks and runs it remotely. It has not yet decided whether the start date for employees in the first year in autumn should be changed.

In addition, the company is launching a partner funded “employee fund to provide financial relief to employees experiencing financial difficulties as a result of the pandemic” to help them with household costs. And a holiday bank was created, in which employees can donate unused vacation time to others who need it for medical emergencies or for family care.

Day Pitney

In a statement dated April 8, managing partner Tom Goldberg said the firm had reduced pay for all attorneys and some employees, as well as other employees, by 15% to 60% of normal working hours and remuneration during remote working hours. The company also made "significant reductions in partner raffles" and suspended a planned additional distribution in April. Goldberg said the company had implemented the measures "to maintain our financial stability during this time while still serving our customers effectively."

Dentons

Compensation cuts that take effect on May 1 will apply to all partners, lawyers and employees who earn at least $ 60,000. The partners will bear the brunt of the impact. The cuts start at 20% and extend “much higher” for the company's highest paid partners. For employees, including employees and consultants, as well as other timekeepers and business services employees, the cuts will be progressive, starting at 0% for those who earn less than $ 60,000 and 20% for those who earn more than $ 190,000. Individual service providers, whether lawyers, specialists or employees of business services, may receive some or all of these cuts back as bonuses in 2020, depending on the firm's performance. A total of 41 business services employees, many of whom are unable to do their jobs remotely, will be on leave for 90 days from May 1. The company said it would pay all health premiums, including the employee share, for this interval.

Dickinson Wright

The company said in a statement: “Our leadership has developed a tiered contingency plan for the potential for reduced earnings. This plan includes reducing discretionary expenses, reducing the workforce by approximately 3%, canceling our summer program and providing an offer for all participants in this summer class, as well as postponing our employee class arriving in autumn to January. "

Dorsey & Whitney

The Minneapolis-based law firm announced on April 8 that it limited the value of its monthly distributions from equity partners and took less than 4% of its 1,100+ employees on vacation. The company also cuts its employee pension contributions by 33%. In the meantime, Dorsey has instructed his employees to closely monitor the amount of money they are spending. The company said it would "re-evaluate its actions from time to time and intend to limit disruption to its workforce as much as possible."

Duane Morris

Philadelphia-based law firm Am Law 200 announced on April 9 that it plans to delay this month's distributions to equity partners. A company spokesman also said it had "given a limited number of administrative staff who cannot effectively work remotely," but plans to call them back to work as soon as the company can reopen its offices. "Employees keep their health insurance paid for by Duane Morris," the company said.

On April 14, the company informed employees and special advisors that their basic salaries would be temporarily reduced by 15% from May 1 to the end of the year, a source said. In an updated statement dated April 16, the company announced that it had also reduced the target compensation for equity partners by 25% and the compensation for non-share partners by 20% at the end of the year. The 15% cut in wages for employees, special advisors, and employees who earn more than $ 100,000 annually was recognized, and retirement benefits were suspended for all employees until the end of 2020.

Eversheds Sutherland

On May 6, the firm announced to its lawyers that it would reduce the remuneration for US attorneys and employees by an average of 10% and leave approximately 40 employees on leave. The law firm postpones the start date for its associate class in the first year from autumn to January 2021. From July, the law firm will host a shortened, remote-controlled summer associate program for its approximately 20 US law students and plans to find a job offers for the fall of 2021. Equity partners will "lead the way in reducing compensation," said Mark Wasserman, co-chair of the company in the United States, because as revenues decrease, their payouts will decrease. (The company remunerates its equity partners solely through profit distributions and does not pay them any draws.)

Faegre Drinker Biddle & Reath

The company, the result of a merger between Minneapolis’s Faegre Baker Daniels and Philadelphian Drinker Biddle & Reath on February 1, announced on April 14 that it had postponed its third-party partner distributions by a third to “ prudent and conservative ”during the ongoing COVID-19 pandemic.

According to a statement on May 13, the firm also introduced a temporary 15% wage cut for all other lawyers, which it announced in mid-April and which came into force on May 1. Payments for professional consultants and staff have also been reduced after completing their schedule for those who earn $ 50,000 or more annually and save a maximum of 15%. The company also stated that it took around 1.5% of its staff on leave, many of whom work in the office. These employees continue to receive their benefits.

The company has also made several layoffs due to redundancies created during the February 1 merger. The departed employees make up 1.5% of the total number of employees, and those affected received severance packages, the company said.

Finnegan, Henderson, Farabow, Garrett & Dunner

The firm announced on May 14 that wages cuts for lawyers and employees will come into force on June 1. "The share partners will bear a large part of the resulting financial impact," said the firm's statement. All other lawyers and employees who earn $ 75,000 or more must reduce their pay by 10% to 20%. In particular, Finnegan makes 20% pay cuts for those who earn $ 150,000 or more, 15% cuts for people who earn between $ 100,000 and $ 150,000, and 10% cuts for people who earn $ 75,000 to $ 100,000. Those who earn less than $ 75,000 will not see any wage cuts, the company says.

Fried, Frank, Harris, Shriver and Jacobson

The company offers voluntary takeovers for employees. No binding measures are still being taken, and lawyers are unaffected, a spokeswoman said in June. However, employees can take advantage of buyouts. Those who register will receive a week's salary for each year of service in the company, up to 24 weeks, plus $ 1,000 for each year.

Fisher & Phillips

The employment agency has temporarily cut wages for all attorneys and employees while on leave of some employees who cannot work remotely, law firm chairman Roger Quillen said in an interview on April 10. Quillen said the Atlanta-based company is proactively "trying to secure a solid financial foundation for the company during the COVID-19 crisis and its economic impact."

FordHarrison

The firm told law students that it would cancel its summer associate program because of the “uncertainty and challenges” of the COVID 19 pandemic.

Fox Rothschild

Philadelphia-based law firm Am Law 100 announced that a 10% to 15% gradual salary reduction will come into force in May for all lawyers and employees, those earning $ 100,000 or more annually. There will be no cut wages for lawyers and employees who earn less than this amount. Equity partners have made a special capital contribution and are reducing their monthly draws in stages between 10% and 20%, also from May.

In addition, the summer program for employees will be shortened and employees in the first year will start employment in January 2021. The company does not currently plan or undertake layoffs or vacations of employees or lawyers.

Freshfields Bruckhaus Deringer

Freshfields has closed its last quarterly partner distribution. In the three months to April, the law firm does not pay a distribution to the partners and freezes the payment for its lawyers and delays the decision on the amount of the bonuses. The company's bonus levels are usually set in April, but are now reviewed in September. In addition, the company examines flexible work regulations and offers interested people reduced working hours. The measures are global, but differ from region to region. The company tries to remain financially flexible so that it does not have to lay off or take off employees.

Gilbert + Tobin

Gilbert + Tobin reduced partner drawings by 50%.

Goldberg Segalla

Managing partner Richard Cohen said on March 23 that the company had made an unspecified number of layoffs, "mainly … those whose responsibilities in the current work environment would be immaterial or contentious". He said the company had provided a severance payment, but hoped to resume it as the situation improved.

Goodwin Procter

In a statement on April 10, the company said it had recently reviewed the performance and size of its global operations team – a label for professional personnel. “As a result of our analysis, we made the difficult decision to ask a limited number of our global operations team members to leave the company. We offer affected employees severance packages based on their tenure, ”the company said. It was also noted that it will continue to contribute to the health benefits for these employees until the end of September.

In addition, Goodwin's Summer Associate program is now run remotely and consists of five paid weeks instead of the usual 10.

Greenspoon marten

Florida law firm Am Law 200 confirmed on April 15 that it had fired five attorneys and 40 employees and cut wages across the board. Greenspoon co-founders Gerry Greenspoon and Michael Marder said in a statement that the cuts were preventive measures to offset an expected loss of revenue due to the coronavirus pandemic.

Hogan Lovells

The firm cuts compensation for all U.S. lawyers who earn more than $ 100,000 annually, the firm said on May 6. The cuts, which take effect on June 1, include a 15% to 25% reduction in monthly draws by equity partners. Eigenkapitalpartner werden auch die Hälfte aller Gewinne aus dem ersten Quartal, die normalerweise im August gezahlt werden, auf Dezember verschieben. Bei Nicht-Aktien-Partnern wird die Grundvergütung um 15% reduziert, was einer jährlichen Gehaltskürzung von 8,75% entspricht, wenn die Änderung für das gesamte Jahr in Kraft bleibt. Die meisten Nicht-Partner-Anwälte der Kanzlei, einschließlich aller Mitarbeiter, erhalten eine Gehaltskürzung von 10%, was 6% über das gesamte Jahr entspricht, während die am höchsten entschädigten Anwälte und Spezialisten ebenso wie alle leitenden Anwälte mit 15% gekürzt werden. Anwälte, die derzeit weniger als 100.000 US-Dollar verdienen, bleiben davon unberührt.

Hogan Lovells gab am 16. April bekannt, dass es die Dauer seines US-Sommer-Associate-Programms von 10 auf vier Wochen verkürzen wird, obwohl es die Sommer für acht Wochen bezahlen wird. Das Unternehmen verteilt stattdessen auch Partnerverteilungen und Boni, die ursprünglich für Mai in den kommenden Monaten geplant waren. Anstatt die Partnervergütung auf der Grundlage der Leistung des Unternehmens im Jahr 2019 Anfang Mai zu verteilen, verteilt das Unternehmen die Zahlungen je nach dem jedem Partner geschuldeten Betrag gleichmäßig auf jeden Monat.

Alle Sommermitarbeiter im zweiten Jahr erhalten nach ihrem Abschluss im Jahr 2021 Stellenangebote, während die Sommermitarbeiter im ersten Jahr zur Teilnahme am Sommerprogramm 2021 des Unternehmens eingeladen werden. Hogan Lovells verzögert auch den Starttermin für Mitarbeiter im ersten Jahr in den USA von Oktober 2020 bis Januar 2021, da die meisten staatlichen Anwaltsprüfungen vom Sommer auf den Herbst verschoben werden.

Holland & Hart

Das in Denver ansässige Unternehmen hat Anfang Juni Vergütungskürzungen vorgenommen. Dazu gehörten Kürzungen bei den Ausschüttungen von Eigenkapitalpartnern, die die Kürzungen von 15% für alle Nicht-Eigenkapital-Anwälte übersteigen. Mitarbeiter, die mehr als 100.000 USD verdienen, werden um 7,5% gekürzt, während Mitarbeiter, die mehr als 60.000 USD verdienen, um 5% gekürzt werden. Das Unternehmen kann diese Kürzungen jederzeit aufgrund seiner finanziellen Leistung zurückrufen, sagte eine Unternehmenssprecherin.

Holland & Knight

In einer Erklärung vom 8. Mai sagte die Kanzlei, dass sie einige Mitarbeiter beurlaubt und die Löhne für die meisten Anwälte und Mitarbeiter senkt. Die Anzahl der Partner wurde um durchschnittlich 25% reduziert, und höher bezahlte Partner erhalten eine höhere Reduzierung. Mitarbeiter, Anwälte und leitende Angestellte werden ihre Gehälter um 17,5% senken. Mitarbeiter, die jährlich mehr als 150.000 US-Dollar verdienen, werden um 15% gekürzt. Mitarbeiter, die zwischen 75.000 und 150.000 US-Dollar verdienen, erhalten eine Kürzung um 10%. Mitarbeiter, die weniger als 75.000 US-Dollar verdienen, sind davon nicht betroffen.

Holland & Knight würde nicht sagen, wie viele Mitarbeiter beurlaubt wurden, und fügte hinzu, dass die Entscheidung, welche Mitarbeiter beurlaubt werden sollen, davon abhängt, ob Fernarbeit „die Nutzung der Mitarbeiter durch das Unternehmen ausgeschlossen oder eingeschränkt hat“. Urlaubspersonal erhält weiterhin seine Leistungen.

Hughes Hubbard & Reed

Die Kanzlei Am Law 200 bestätigte am 7. Juli, dass sie eine unbekannte Anzahl von Anwälten und Mitarbeitern entlassen hatte, selbst nachdem sie ein Darlehen in Höhe von mehreren Millionen Gehaltsscheckschutzprogrammen erhalten hatte. Das Unternehmen sagte, das PPP-Darlehensgeld sei für den beabsichtigten Zweck verwendet worden, "um Arbeitsplätze während der schlimmsten Krise zu retten". Mehr als drei Monate später, so das Unternehmen, habe es die „tiefgreifenden Auswirkungen“ von Gerichtsschließungen und einer Verlangsamung der Geschäftstätigkeit gespürt, und das Unternehmen habe „schwierige Personalentscheidungen getroffen, um das aktuelle Umfeld anzugehen“.

Husch Blackwell

Am 23. April kündigte das in Kansas City, Missouri, ansässige Unternehmen an, eine Kombination aus Kündigungen, Urlauben und Lohnkürzungen von Anwälten und Mitarbeitern sowie einen 10% igen Rückhalt der festverzinslichen Partnerentschädigung ab dem 1. Mai zu verwenden, um den wirtschaftlichen Abschwung zu bewältigen verursacht durch die COVID-19-Pandemie. Die jüngsten Schritte folgen auf die Entscheidung im März, die Rückschläge von Aktienpartnern ebenfalls zu erhöhen.

Laut Aussage der Kanzlei waren sowohl Anwälte als auch Mitarbeiter von einigen oder allen Maßnahmen betroffen, aber die Gesamtzahl der von Urlauben und Entlassungen betroffenen Personen „macht weniger als 10% der Kanzlei aus“.

Die neu angekündigten Kostensenkungsmaßnahmen erfolgten, nachdem die C-Level-Mitarbeiter des Unternehmens Gehaltskürzungen vorgenommen und die Eigenkapitalpartner die monatlichen Ziehungen um zusätzliche 15% der Grundvergütung gekürzt hatten, wodurch sich der Holdback der Eigenkapitalpartner von 20% auf 35% erhöhte.

Ice Miller

In einer Erklärung des geschäftsführenden Gesellschafters Steve Humke hat die Kanzlei laut Above the Law 18 professionelle Mitarbeiter und 17 Zeitnehmer beurlaubt. Darüber hinaus erhalten alle Mitglieder des Unternehmens, die mehr als 50.000 US-Dollar verdienen, eine Vergütungsreduzierung, deren Höhe nicht spezifiziert, aber auf der Grundlage der Vergütungsniveaus gestaffelt wurde, wobei die Partner die größte Reduzierung vornehmen.

Humke sagte auch, dass das Unternehmen normalerweise nicht auf Kredite angewiesen ist und jeden Monat nach Zahlung der Kosten einen erheblichen Teil der Partnerverlosungen auszahlt, anstatt Mittel für eine größere Auszahlung zum Jahresende zurückzuhalten. Infolgedessen sei Ice Miller auf die Vergütungskürzungen von Vergleichsunternehmen ausgerichtet. Er sagte, die Firma plane, alle Teammitglieder wieder auf ihre regulären Gehälter anzuheben, sobald der Markt dies zulasse.

Katten Muchin Rosenman

Die Kanzlei gab am 29. April bekannt, dass sie im Mai Lohnkürzungen und Urlaubstage einführt und die Gehälter für Anwälte und Geschäftsleute, die über 100.000 USD pro Jahr verdienen, um bis zu 20% senkt, ohne dass dies unter dieses Niveau fällt. Die Urlaubstage betrafen eine nicht näher bezeichnete Anzahl von Fach- und Verwaltungsmitarbeitern sowie eine geringe Anzahl von Anwälten. Katten also suspended partner dividends at least through May. The firm simultaneously announced the creation of a fund to assist furloughed employees, augmenting state and federal aid.

On June 29, Katten said some of those furloughs will be made permanent. Katten enacted a “separation agreement” with many of its furloughed business administration staff, the firm said, noting the layoffs, starting Aug. 1, would not affect any attorneys at any level. Equity partners received monthly payouts in June, but at a 25% reduction from previous levels.

Kelley Drye & Warren

The firm said on April 14 that equity partners’ draws will be reduced on a proportional basis by as much as 20%, effective April 30. There will be an across-the-board, prospective salary reduction of 10% for all other lawyers and employees earning over $100,000, effective May 15. Also, the July 1 administrative staff salary increases will be postponed.

The firm also shortened the summer program, delayed the start of our first year associate class and postponed non-essential hires. It has also suspended services provided by non-essential consultants, independent contractors and vendors.

Kilpatrick Townsend & Stockton

Kilpatrick has temporarily cut partner draws by an average of 10%, effective April 7, and it will reduce pay by 5% for other lawyers and staff as of April 16, the Atlanta-based firm told Law.com in a statement. Secretaries, who are hourly employees, will have their work time reduced by 20% as of April 20.

KPMG – Australia

KPMG said equity partners across the entire firm have agreed to forego a partner distribution payment due in mid-April. It added that over the four months beginning in May they will take an effective pay reduction of 36%.

K&L Gates

In a firmwide email provided to ALM, K&L Gates announced equity partners’ scheduled advances will be reduced by 20% in April and “subject to review each month going forward.” Income partners, associates and staff will experience a 15% reduction in salary, with a floor of $75,000, the firm said, beginning May 1.

“This reduction will be revisited on a regular basis as the year progresses with the goal of mitigating or eliminating it as circumstances warrant.  All personnel will be considered for discretionary bonuses for extraordinary performances or contributions, as many are working very hard through this period,” the email said.

The firm also noted other cost-saving measures, including cancelling and deferring discretionary spending and implementing a hiring freeze.

Littler Mendelson

The firm said on April 28 that its salary reductions will range from 4% to 20%. On May 8, equity shareholders will take a 20% cut to compensation, while salaries for nonequity shareholders and staff making above $300,000 will be cut by 15%. The cuts for the highest earners will be followed June 5 by 10% reductions on average for the firm’s other lawyers and staff. Pay cuts will range from 4% for those making $50,000 or less to 13% for those making over $200,000 up to $300,000. While Littler is not laying off or furloughing any employees, it will cut pay by 50% on June 5 for staff who are unable to work remotely, the firm said.

Locke Lord

Noting the firm is in a strong financial position with no long-term debt, Locke Lord said it is implementing some “difficult but preemptive actions” to reduce expenses for the remainder of the year. As of May 1, the Dallas-based firm reduced equity partner draws by 10%, compensation for attorneys and senior staff by 10%, and salaries for support staff by 5%. The firm said in a statement on May 8 that it had earlier furloughed a “small number” of support staff, but now eliminated some of the positions. “We are doing all we can to support the impacted employees,” the firm said.

Loeb & Loeb

California-based Loeb & Loeb is temporarily reducing partner draws by 20% and deferring its April capital distribution to July, because the federal tax filing was moved to that month, according to a memo from chairman Kenneth Florin. The firm also reduced pay of income partners, senior counsel, of counsel, associates and senior staff by 15% and paralegals and other staff by 10%.

Lowenstein Sandler

The 300-lawyer firm, based in New Jersey, said in April that although it was doing well financially, it had decided to pause a portion of planned distributions for equity partners.

The firm said in July that it resumed distributions to equity partners in May and that it was “rapidly catching up on distributions.”

Marshall Dennehey Warner Coleman & Goggin

Marshall Dennehey president and CEO Mark Thompson announced in a firmwide email March 30 that the firm is suspending its 4% employer 401(k) match until next year. The policy is effective May 1. The firm is doing so in an effort to avoid layoffs, he said.

Mayer Brown

The firm announced on May 6 that it plans to reduce salaries by 15% for nonequity lawyers and staff who make more than $200,000. Salaries for business services staff who earn less than $200,000 will see their pay reduced according to a graduated scale. The firm already reduced distributions for equity partners in March.The firm also announced the start of a program that will allow both its lawyers and staff to request up to 12 weeks of sabbatical. The firm has also pushed back the start date for its U.S. associate class from fall 2020 to January 2021.

McDermott Will & Emery

The firm is making cuts to its professional ranks, eliminating an undisclosed number of staff in response to the COVID-19 crisis and its economic fallout. “While our firm is well positioned to weather economic turbulence, we are also not immune to it,” said a firm spokesperson on April 22. “Unfortunately, this meant making the difficult decision to part ways with some of our valued staff professionals and to furlough some others.”

Miller, Canfield, Paddock and Stone

Miller Canfield reduced attorney pay and reduced its head count by at least nine lawyers. The Detroit-based firm laid off one principal and six non-principals, including three associates, according to a statement on Above the Law on July 10. The firm furloughed two additional full-time attorneys, including one associate.

Miller Canfield CEO Michael McGee told Law.com in June that the firm was planning on pay cuts and “some furloughs and layoffs consistent with what we’re seeing throughout the legal marketplace.” McGee indicated that lawyers who have seen a slow down in their work will be furloughed. Starting June 15, he added, Miller Canfield planned to enact salary cuts for its equity and income partners, associates and professional staff. Income partners had their salaries cut by 10% while associates and staff saw their salaries get hit by 7.5%, all on an annualized basis, McGee said. No cuts were enacted on anyone making less than $50,000, nor did anyone’s salary drop below that threshold, he said. The firm had received a $5 million to 10 million loan as part of the Paycheck Protection Program.

MinterEllison

At MinterEllison, equity partners have agreed to reduce drawdowns by half, effective immediately. It has also placed non-business-critical projects on hold, placed a freeze on new hires and deferred promotions until January 2021. Additionally, MinterEllison has introduced a temporary COVID-19 leave scheme and has asked all permanent employees to purchase six weeks of leave, which will be paid leave funded by a temporary salary reduction from April to December.

Mintz, Levin, Cohn, Ferris, Glovsky and Popeo

In an email to the firm April 10, Mintz chairman Robert Bodian said the firm will be decreasing staff and paraprofessional salaries by 5% across the board (with an exception for those making less than $75,000 per year) and will be reducing associate salaries by 10%. Discretionary bonus payouts have been reduced by 50% for staff and taken off the table for associates. The firm is instituting a holdback on 40% of equity partner profits (it was previously 30%), and monthly payouts to equity partners will be reduced by 10%, with nonequity partner payouts reduced by 5%.The email also said the firm is not in a position now where it needs to furlough or lay off attorneys or staff.

Munck Wilson Mandala

Midsize Texas firm Munck Wilson Mandala reduced compensation for partners, associates, exempt directors and managers, but said it had no plans to reduce attorney headcount. Managing partner William Munck said in a press release that a limited number of salaried employees will be furloughed and some hourly employees will work reduced hours, but all employees will receive full benefits. Additionally, several partners have chosen to defer their base salary for the next three months, Munck said. According to Munck, the firm intends to treat the reductions as compensation deferrals to be paid by the end of the year or when practical.

As of July 1, a firm spokesperson said that month, it had resumed normal pay for all employees, and it did not reduce its head count. The firm’s managing partner, William Munck, did not return a message seeking additional comment about furloughed employees.

Nixon Peabody

Nixon Peabody furloughed approximately 25% of its staff, beginning April 6 until “further notice,” according to an 3. April tip to Above the Law. It took further steps on April 6 – ATL reported that 10% of non-partner attorneys, including senior associates, would be cut. Of those let go from the firm, about half would be layoffs with three months of health insurance, and half would be furloughs, presumably with full benefits. According to ALM data, there were 289 non-partner lawyers at the firm in 2019, meaning 28-29 former Nixon Peabody lawyers are now out of work. The firm has not responded to repeated requests for comment and confirmation about the cuts.

Norton Rose Fulbright

Norton Rose Fulbright is offering staff in Europe, the Middle East and Asia reduced working hours and pay for one year in response to the COVID-19 crisis, as well as deferring the payment of partner distributions, staff salary rises and bonuses for both groups.

If 75% of eligible staff accept the reduced hours offer, which means they could be asked in the next 12 months to reduce their working hours and pay by 20%, the new program will commence on April 20.

Ogletree, Deakins, Nash, Smoak & Stewart

The firm on April 21 said it will cut pay through the end of the year for all lawyers, including shareholders, and for staff making over $100,000. Ogletree is reducing compensation for equity shareholders by 20% and for other lawyers by 15%, according to the statement. Staff earning $100,000 or more will have pay cut by 10%, but those making less than that will not have their compensation reduced.

In an April 16 statement, the firm said it was furloughing some staff and reducing hours for others whose jobs are not suited for remote work.

Orrick, Herrington & Sutcliffe

The firm is delaying its incoming first-year associate class until 2021, reducing pay for U.S. attorneys and staff firm-wide, reducing some staff hours and altering its 2020 summer associate program. The firm said it is not planning to furlough or lay off employees, according to an April 8 statement. Associates and staff will see pay cuts on a graduated scale. A “small percentage of staff” will also see reductions in hours starting May 1 until September. Partners, of counsel and executive staff will see “deeper cuts.” The firm would not elaborate on what those reductions are. The firm also said it will conduct its 2020 summer associate program virtually and shorten the program’s length to five weeks. It is giving permanent offers now to 2L law students to return to the firm as associates after graduation and is giving current 1Ls offers to return to the firm next summer.

Pepper Hamilton

The firm said it has reduced distributions to partners, and all other attorneys will see their salaries decreased by 12% on an annualized basis. Staff with salaries of $60,000 or more will see their salaries cut by 3% to 9%, on an annualized basis, based on a graduated scale. In a statement, the firm said it wants to avoid layoffs, and it is still planning to merge with Atlanta-based Am Law 100 firm Troutman Sanders on July 1, as previously announced.

On May 22, the firm announced that it will also defer the start date for new associates to January 2021, to “provide for a better work and training experience.” The firm plans to provide its entry-level associates with financial assistance to help with living expenses and costs associated with bar exam preparation, and they will be able to enroll in the firm’s health insurance plan.

Perkins Coie

The firm said May 13 that it had delayed partner payouts starting in March. It also implemented 15% pay reductions going forward for non-partner lawyers and 10-15% pay reductions going forward for staff making over $125,000. The firm said at the end of this year it plans to allocate funds for special payments and bonuses to non-partner lawyers and staff, commensurate with performance.

Pillsbury Winthrop Shaw Pittman

Implementing a “shared sacrifice” approach to dealing with the economic fallout from the COVID-19 crisis, Pillsbury has temporarily reduced partner draws and associate, counsel and staff compensation. Beginning in April, partner draws were reduced by a minimum of 25%, with the percentage increasing on a progressive scale, so partners higher in the draw will see a larger cut. Compensation of associates and counsel was reduced by 20%. Staff in the U.S. making at least $75,000 will see a pay cut of 10% and those making more than $100,000 will get a pay cut of 15%. Chief officers will take a greater pay cut that is more in line with that of partners. The firm is considering similar actions for offices outside the U.S., a spokesman for the firm confirmed.

Pryor Cashman

Pryor Cashman has furloughed some associates in response to a slowdown in work related to the coronavirus pandemic, managing partner Ronald Shechtman said. The leader of the 185-attorney firm wouldn’t specify the number of associates or say whether any practice groups were particularly impacted, but said the firm is “hopeful” and expects it can reinstate them once work picks back up.

PwC

PwC’s legal arm is freezing promotions, pay raises and bonuses across its whole U.K. business.

Quinn Emanuel Urquhart & Sullivan

Founder John Quinn confirmed May 11 that the firm has delayed partner distributions that were originally scheduled for April until July to respond to the economic uncertainties of the coronavirus pandemic. The firm has also adjusted the size of partner draws for April, May and June. The changes will be revisited in July.

Quinn would not comment on the specific size of the draws but emphasized that reductions were not universal. “Some people are getting less than before, while some are getting more,” he said. “It’s not true that all are getting reduced.”

Reed Smith

Reed Smith is reducing partner distributions in response to the disruption and economic effects of the new coronavirus, the firm confirmed March 30. After first announcing that it would reduce monthly draws by 40% for the next five months for equity partners, and 15% for the next three months for nonequity partners globally, the firm said April 16 that it would also cut associate pay by 15% and counsel pay by 10%.

Later in April, the firm said it will also defer its equity partners’ bonuses into two payments, with partners paid half their bonus amount on the scheduled payment date, and the other half three months later. But, the firm said, ”Fixed share partner, counsel and associate bonuses will be paid in full and on their regularly scheduled pay dates.”

Ropes & Gray

The firm confirmed May 14 it is offering a voluntary buyouts plan to U.S. business support staff. Employees would receive one week of severance pay for every year of service to the firm, plus an additional four weeks of pay, equaling a minimum of 12 weeks or a maximum of 30 weeks’ pay. The firm will also pay its share of health benefits for employees who take the buyout through the end of 2020. Attorneys are not eligible for the buyout. Most departures will take place between June 19 and Aug. 3. “We’re being proactive. We need to take steps now to address our new reality,” a firm spokesperson said.

Saul Ewing Arnstein & Lehr

In an April 30 statement, the firm said it reduced partner draws and took other austerity measures including: salary reductions for people making more than $50,000 per year; temporary furloughs; and layoffs. A spokesperson for the firm declined to clarify the amount of the salary reductions or the extent of furloughs and layoffs.

Scahill Law Group

This midsize insurance defense firm with its main office on Long Island has furloughed 50 people, its managing partner said in an interview.

Schiff Hardin

The firm said it is cutting salaries for both attorneys and staff, including reductions of up to 50% in compensation that will affect about 6% of the Chicago-based firm’s attorneys. Most of Schiff Hardin’s lawyers and staffers who make more than $100,000 will see their salaries temporarily cut by 15%; the potential 50% pay cuts some lawyers might receive will be based on “anticipated demand.

Seyfarth Shaw

The firm on April 17 announced it was reducing equity partner draws, cutting salaries and furloughing 10% of its U.S. workforce. Starting May 1, all of Seyfarth’s non-equity lawyers in the U.S. will see their pay reduced by 10%. The firm is cutting salaries for staffers—the first $60,000 won’t be affected, but earnings between $60,000 and $150,000 will be cut by 5%. Anything a staffer makes past $150,000 will be cut by 10%. Equity partners, meanwhile, have seen their monthly draws reduced by 20% starting April 1. The 1,900-person firm is also furloughing 10% of its U.S. workforce for 90 days, but Seyfarth will pick up the tab for that group’s health coverage. The furloughs will affect staff and a “smaller percent of attorneys.”

Shearman & Sterling

Shearman is offering all its global staff and fee-earners sabbaticals on reduced pay. The voluntary leave program will allow participants to take up between three and six months off work at 30% pay, the firm confirmed, but that will be increased to 40% if they engage in pro bono work during their voluntary leave.

Sheppard, Mullin, Richter & Hampton

The firm announced April 13 it was furloughing 33 of its 823 staff members. The furloughs apply to team members who cannot do their jobs remotely, including receptionists, support services and file center employees, the international law firm said in a statement. The affected staff members had been on payroll during the last four weeks when the firm transitioned to working from home. The employees were told they could expect to return to work in 60 to 90 days.

Shook Hardy & Bacon

A firm statement said it is delaying or deferring various operating expenses, deferring some partner distributions, reducing partner draws, introducing pay reductions and temporarily furloughing some employees.

Smith Gambrell & Russell

The Atlanta-based Am Law 200 firm is deferring partner draws by 20% and cutting pay for all employees, including associates, by 10%, chairman Stephen Forte told Law.com. He said the firm will not be furloughing or laying off employees.

Skimpy Patton Boggs

The firm announced on May 1 across-the-board pay cuts in the U.S. and overseas, along with furloughs of an undisclosed number of support staff. The firm said partners, as owners of the business, would take the biggest hit, via reduced profit distributions. Associates will see salaries cut by 20%, but bonuses will not be affected. Support staff will see cuts ranging from 10% to 20%, with higher earners subject to larger reductions. Some staff who either are currently underused or unable to do their jobs remotely will be subject to furloughs. The firm is also canceling its 2020 summer associates program. Instead, admitted students will receive a $5,000 stipend. Incoming U.S. associates who had been scheduled to join the firm in September will now start in January 2021.

Stoel Rives

The Portland, Oregon-born Am Law 200 firm is reducing partner distributions by 20%, effective April 1, as well as a 20% pay reduction for associates, staff attorneys and of counsel on an annualized basis starting in May (making for a 13% reduction as of the end of the year). The firm is furloughing about 10% of staff beginning April 17 for at least 90 days, though benefits for these employees will continue. The firm has also implemented hourly reductions for staff, with corresponding pay reductions: 5% for those earning less than $75,000, 10% for those who make $75,000 to $100,000, 15% for those making $100,000 to $150,000, and 20% for those who make over $150,000 annually.

Stoel Rives has also put in place a hiring and spending freeze, eliminated associate bonuses based on hours billed, though it may give some “discretionary-only” bonuses, and eliminated reimbursement for parking and transit.

Stroock & Stroock & Lavan

Stroock implemented pay cuts and offered voluntary buyouts. From the start of June, equity partners saw draws reduced by 20% and all other lawyers took a 15% hit. Associates who hit hours targets will ultimately be “made whole,” however. And employees who wish to retire early or avoid returning to the office when remote work ends will have the option of taking “generous” buyouts.” A spokesperson added, “We have let staff and attorneys know that, subject to firm needs, we are open to reduced schedules for individuals who voluntarily elect to go that route.”

Sullivan & Worcester

In addition to general discretionary expense cutting, managing partner Joel Carpenter said the Boston-based firm has furloughed a number of employees for 90 days with full benefits and has instituted temporary pay cuts across the board. Employees making less than $66,000 per year will not be affected, while those staff and employees making over that mark will see a 5% reduction in salary. Non-equity partners will see a 10% reduction, while equity partners will see a 20% decrease from their monthly draws.

Taft Stettinius & Hollister

Effective April 1, partner draws were reduced by 25% and the firm made “minimal reductions” in head count representing 1.4% of attorneys and 3.5% of staff, spread across the firm’s seven primary offices. “At present, Taft does not intend to adopt the approach of making across the board reductions in the head count or compensation of its administrative staff or associates, counsel or staff attorneys,” the firm said on April 6. “Instead, consistent with the employer-of-choice workplace culture that is one of Taft’s hallmarks, the Taft partners intend to shoulder the primary economic burden of COVID-19.”

Thompson Hine

The firm has aggressively decreased non-compensation expenses and is reducing quarterly partner draws by 15% and staff compensation by 1.7% on an annual basis, according to an April 14 email from a spokesperson.

Vedder Price

The firm has taken the following measures in response to the ongoing COVID-19 crisis, according to a statement a spokesperson provided on May 5:  “We reduced our workforce by 4% in areas where utilization was most impacted by the remote work environment, and provided each affected person with severance plus healthcare coverage through September. The firm’s shareholders/owners also proactively reduced their current pay by 20% to bear the financial brunt of the crisis. Finally, we shortened the duration of our 2020 summer program and deferred the start date of our incoming 2020 first year associate class to January 2021.”

Venable

The firm said in an April 10 statement it has postponed certain distributions to equity partners, implemented “tiered compensation reductions for attorneys and staff,” and temporarily furloughed certain staff in roles that primarily support office operations. “We have taken steps to tailor staffing needs to the current environment and prudently prepare the firm for the future,” the statement added.

Vinson & Elkins

The firm will delay the start of its 2020 summer associate program until June 15 at the earliest, because several offices are now under mandatory stay-at-home orders that will remain in effect through April and into May. “It is our hope and intention that the summer associate program will occur, albeit with some appropriate modifications in light of the COVID-19 pandemic,” hiring partner Steve Gill wrote in a note sent to associates last week.

Winston & Strawn

The firm announced to partners on April 6 that their distributions would be cut by 50% over the next three months, according to a report by Above the Law.

Womble Bond Dickinson

Womble Bond Dickinson is temporarily cutting pay across the firm’s U.S. offices and furloughing or laying off some employees to weather the economic shutdown from the coronavirus pandemic. The trans-Atlantic Am Law 100 firm, which has about 550 lawyers in its U.S. offices, has instituted a 10% or less pay cut for all U.S. attorneys and staff, furloughed “some selected employees” and laid off “another small group,” Womble said in a statement to The American Lawyer.

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