Associate Bonus Watch: Erasing The New York/Non-New York Divide
This firm is now paying all associates on the same scale, regardless of office location, and people seem pretty happy about it.
To control their compensation costs, some firms have a practice of paying higher bonuses to their New York associates — generally whatever the market rate is for a given year — and lower bonuses to associates in other offices. It can be defended by referring to NYC’s high cost of living and the need to be competitive for talent in the Big Apple, but if often doesn’t sit well with associates outside New York. And given the increasingly national or even international nature of legal practice, where a matter might be staffed with lawyers from all over the country or the world, this compensation differential might be anachronistic (especially if the associates are being billed out at rates that don’t reflect their office location).
Last year, Pillsbury Winthrop paid market bonuses in New York and lower bonuses in other offices. This created complaints from Pillsbury associates in other major markets who had solid hours and strong reviews but received below-market bonuses.
This year, Pillsbury is taking a different tack, as one tipster told us:
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Happy to report that Pillsbury announced it will be paying Cravath bonuses to associates in all offices. The firm had another great year, and it’s nice to see that the firm is acknowledging the associates’ hard work. Note that this is a major departure from previous years where only NY associates received market bonuses. Beyond thrilled.
The memo went out last week. Here’s the Pillsbury bonus table, which applies firm-wide:
As you can see, associates who hit 2000 hours get market-level bonuses, and associates between 1900 and 2000 hours get half of the market. In addition, the firm created a separate bonus pool for associates who did not hit 1900 hours but nevertheless had an excellent year (e.g., major pro bono work); these bonuses range from $5,000 to $15,000.
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Said a second source:
To their credit, the firm listened to associate concerns last year and revamped the bonus structure. Everyone is quite pleased.
From a third Pillsbury associate (who last year expressed dissatisfaction with PWSP bonuses):
Waiting for our individualized bonus memos, but the firm’s bonus program announcement announced Cravath scale for those billing 2000+. Very, very happy that the firm is falling in line with the rest of the market.
Now, great people to work with AND market compensation. Love me some Pillsbury doughboy!
Nothing says lovin’ like market bonuses from the oven. Hee-hee!
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Earlier: Prior ATL coverage of Associate Bonus Watch 2015
