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Waves of Layoffs Ripple Over Large Firms Throughout the Country
Law firms are tightening up and trimming the fat to stay lean and to stay in the game. Lawyers are being pushed to their limits, as firms see high benchmarks in profitability per lawyer, even as hiring is as slow as it has been. Above the Law notes that as firms move beyond $2 million in per partner profits, PPP will still remain undiluted. In other ways to enhance profitability, big law firm Debevoise & Plimpton, “prestigious and profitable,” also separated from its trusts and estates practice, definitely a profit enhancing maneuver.
Debevoise’s internal dealings with its own staff include voluntary buyouts as well as staff layoffs. “Even secretaries are being offered packages, from $10,000 to $25,000 as well as “one week of pay for every year of service.” In some firms, as much as 30% of staff will be expected to take the package. Debevoise commented on their firm wide buyout offers and layoffs.
“We regularly review administrative staffing levels, and in light of continued technological and other changes in how law firms work, we have made the decision to make some modest reductions to our administrative staff through an incentivized voluntary retirement program within out secretarial department and a small number of headcount reductions in other areas. We are committed to working closely with our affected colleagues to provide them with appropriate severance and support.”
As institutions utilize their personnel flexibility to maintain the correct firm size in the tumultuous waters of todays legal market, voluntary retirement packages and severance packages are a kind way for staff to have a lump sum of cash, while facing the prospects of moving on and separating from the firm. As firms maintain their operating income and their human recourse expense when some staff members take a buyout, that effectively leaves more fuel in the pot to keep things running with the remaining staff. The workload may remain the same, effectively sometimes doubling the amount of tasks, and projects that staff will manage. In these times however, especially in times of layoffs, adding a bit more work to one person’s inflow work box will not make a critical difference to them. They most likely will be focused on keeping their job.
Retirement programs where individuals can opt in or not allows employees the autonomy to choose their futures, which is empowering and has a completely different feel, unlike when a company hands you a pink slip, or lays off a mom of five while single people with ample savings continue working. This way people feel they have more control in their lives, and it gives them pride to make their own decisions this way. It makes for happier workers and a more balanced environment.