Reed Smith Asks Non Equity Partners for a Tithing

Render unto Caesar what is Caesar’s, or so the expression goes. Now Reed Smith is asking much the same of its non equity partners. Non equity partners are being asked to contribute as much as 15% of their base salary to the company or risk losing partnership status. Gregory Jordan, the firm’s chairman, had this to say about the plan. ““It’s about not just saying you’re a partner, but actually being one. It means something. It revolves around risk-sharing in the business.” Jordan defended the move, saying that it isn’t a means to get a quick cash infusion into the company, and going on to say that Reed Smith is having “a very strong year”.

A very strong year? That doesn’t square up with the history.

In March, Reed Smith laid off 100, 26 lawyers and 74 staff.

In May, Reed Smith cut all US associate salaries by 10%.

In August, Reed Smith cancelled on campus interviews at Fordham law at the last minute, prompting the school to ban Reed Smith from on campus recruitment for five years.

Last week, Reed Smith cut the salaries of incoming associates by 20% and lowered their billing rates for work done by new associates. This came two weeks after announcing a plan to move away from lock step.

If this is a very strong year, I would hate to see what things look like in a bad year.

• Haynes & Boone Cut First Year Salaries
• Salary Freeze at Covington & Burling
• Reed Smith Cuts Salaries
• Revenue and Profits Down at Goodwin Procter
• Revenue Down But Profits Up at Reed Smith

Posted by joshua on November 16, 2009. Filed under Home,Law Firm News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry