It’s the holidays, and that means it’s that time of year when law firms are doling out their annual bonuses. But despite the fact that law firms made more money in 2011 than they did in 2010, this year’s bonuses are nearly identical to the previous two years’ amounts.
On Nov. 28, Cravath, Swaine & Moore, which traditionally has set the benchmark for the bonuses that other firms give to their lawyers, announced its 2011 year-end bonuses. The Wall Street Journal Law Blog reported that Cravath’s first-year associates will receive $7,500, while seventh-year associates will receive $37,500. Shortly after the announcement, Skadden, Milbank, Proskauer Rose and other top firms announced similar bonus amounts.
But Thomson Reuters reports that a September Wells Fargo Wealth Management survey revealed that law firms made more money this year than they did in 2010, with profits per partner rising 7.6 percent for the first half of the year at 125 of the country’s top firms. Revenue also increased 4.5 percent.
Experts say the stagnant bonuses are a sign of image-awareness among law firms. With Occupy protesters across the country assailing greed and many clients still reeling from economic troubles, firms are hesitant to dispense huge bonuses to attorneys.
Nonetheless, in-house lawyers saw bigger bonuses last year. HBR Consulting’s 2010 law department salary survey indicated that in-house bonuses jumped an average of 73.5 percent between 2009 and 2010. The increase brought bonuses back to pre-recession levels.
Read about 2011 in-house compensation and job trends, including news about salaries and bonuses, in the February 2012 issue of InsideCounsel.