Summary: The end-of-year at Cravath Swaine & Moore will be the same as last year despite their first-year associates receiving a big pay increase a few months ago.
Despite giving a big pay raise to first-year associates, Cravath Swaine & Moore LLP will be keeping their year-end bonuses the same. Their junior lawyers were told today that the bonus will be the same as last year. This comes as a clear sign that law firms are still be cautious in their money since the recession.
First-year associates can expect bonuses in the $15,000 range while seven or eight year associates will see a $100,000 payout. Since Cravath has been paving the way for other firms this year with the salary increase, it is expected that other law firms will follow their lead.
Earlier this year they dropped jaws as they announced a 12.5 percent salary increase for their first-year associates to $180,000. This raise is the first in roughly ten years. Law firms with hundreds more associates and in lower-tier markets raced to keep up with Cravath. Some clients have questioned the increases as being excessive.
The increase has not hurt Cravath. They continue taking high-profile merger and acquisition deals such as advising Qualcomm Inc. through a $39 billion acquisition of NXP Semiconductors NV and Time Warner Inc. with their planned $85.4 billion sale to AT&T Inc.
New York law firm Paul, Weiss, Rifkind, Wharton & Garrison LLP has already announced to their associates that they will be following the same scale as Cravath. Most law firms follow a bonus schedule based on the starting year of their lawyers but others will use a merit-based method of allocating bonus amounts.
Do you think the associates should be getting bigger bonuses to match their raise increase? Tell us in the comments below.
To learn more about Cravath, read these articles:
- “Cravath Effect” Takes Place with Several Firms Upping Salary Rates
- Firms Follow Cravath’s $180,000 Base Pay Scale
- End-Of-Year Bonus Time at Cravath, Swaine and Moore
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