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Mad Mad Money

Vivia Chen

December 15, 2010

Fotolia_11511783_XS Hark, the angels have returned! Law firms are throwing money at associates again! It's the miracle that lawyers have been praying for.

First, Cravath, Swaine & Moore kicked off the holiday season by announcing bonuses ($7,000- $35,000), which a slew of other big firms quickly duplicated almost to the dollar. Then, Cahill Gordon & Reindel stole the show by showering their associates with even fatter bonuses. Reports Above the Law: Cahill is paying out year-end bonuses of $15,000-$25,000, which are in addition to the midyear $2,500-$15,000 bonuses it paid last summer. Plus, it'll be paying out another round of bonuses equal to the Cravath ones in January! (Cahill has not responded to my requests for comment.)

Now, comes another show-stopper: 90-lawyer litigation shop Susman Godfrey just handed out bonuses in amounts of $45,000-$100,000-plus. Steven Susman, head of the firm, said in an e-mail to me: "Our associates work very hard and are very, very good. When we have a good year, their bonuses go up. These bonuses are about 20 percent higher than last year because we had about a 20 percent better year." (Susman also confirms that his firm has not had any layoffs.)

So let the bonus wars begin! C'mon, you other kick-ass boutiques out there: Put your money on the table. Hey, Boies Schiller and Quinn Emanuel, what's cooking in your bonus pot? Something smells good!

All this bonus money flying in the air makes me feel I'm back in the halcyon days of 2006. There should be celebration, but why do I sense a chill amid the good news?

What I find jarring, especially in the case of Cahill's largesse, is that associates were laid off by the firm as recently as a year ago. (ATL reports that Cahill did two rounds of layoffs in '09 and '10 that totaled around 60 lawyers.) Yes, I know that then was then, and now is now. And yes, I agree that Cahill should be lauded for sharing its bounty.

Yet, despite Cahill's act of generosity, I feel there's something fundamentally askew--and  discomfiting--about throwing out human capital one year, then lavishly filling the pockets of those who manage to survive the downturn a year later. The fates of the two groups--those laid-off and those still on the big-firm track--seem cruelly arbitrary to me.

I've asked in an earlier post, and I'll ask again: Why won't firms that are now flush with work consider hiring back some of the young talent they laid off during the recession? I know the standard answers--that the laid-off ones were the weak links, or that firms are fixated on class years and won't consider those who've aged out--but I've always found those explanations pretty lame.

My take is that firms don't tend to dwell on the fortunes of those they've cast aside. Good riddance, they seem to be saying, if you had the misfortune of bad timing. It's nobody's fault that so many laid-off associates are still out there. It wasn't personal. Really.

I suppose business is just business. Laying off associates when the firm is having a tough year, then turning 180 degrees and paying huge bonuses when the going is good, is just going with the currents of the market. It's a short-term solution, but efficient in its way.

What can I say? Take the money and run.


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Photo: Fotolia



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i dont understand why youre singling out quinn on bonuses. they've never been anything other than super cheap when it comes to this stuff

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The Careerist takes an inside look at how lawyers shape their careers and manage their lives. The blog aims to dissect developments in the profession, provide useful information and advice, and give lawyers a platform to voice their views. The goal is to provide a fresh, provocative take on the state of lawyering.

About Vivia Chen

Vivia Chen

Vivia Chen, The Careerist's chief blogger, has been covering the business and culture of law firms for a decade. A former corporate lawyer, Chen is fascinated by those who thrive (as well as those who don't) in the legal profession. Her take: Success in the law (and life) doesn't always travel a linear path. If you have topics you'd like to discuss or information to share, contact her: VChen@alm.com

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