(Image via Getty)
If you thought the weekend would somehow stem the rising tide of layoffs, furloughs, and salary cuts that have become Biglaw’s new normal, then you were wrong. May the Fourth be with you if you’ve yet to hear what your law firm’s plans are, whether good or bad.
Today, we have news from Pillsbury, a firm that came in 62nd place in the most recent Am Law 100 rankings, with $677,320,000 in gross revenue in 2019. Pillsbury’s chairman, David Dekker, sent a memo to all employees, describing the “shared sacrifice” that everyone would need to take part in to protect the firm from layoffs. “We know that any sacrifice can be painful,” he wrote, “and hope to scale them in a manner such that they are tolerable for all.” These are the firm’s austerity measures:
- Starting in April, partner monthly draws were reduced by a minimum of 25 percent, on a progressive scale so that the higher a partner sits in the draw, the larger his or her percentage reduction;
- Starting with May 15 payments, the firm will be temporarily reducing the compensation of associates and counsel in the United States by 20 percent; and
- Starting with May 15 payments, all staff compensation will be reduced by up to 15 percent for those who make more than $100,000, except for chief officers who volunteered to take higher reductions, commensurate with those of partners. Employees making less than $75,000 will not be impacted.
“We sincerely hope that this is a short-term measure, although at this point we cannot precisely forecast its duration,” Dekker cautioned. He says he’s hopeful that the firm will be able to offer an “expanded discretionary bonus program” in the future to make up for “at least some of the reductions experienced.”
We reached out to the firm for comment, and a spokesperson had this to say:
Pillsbury has had a strong start to 2020 but the pandemic is both unprecedented and unpredictable, and economic conditions around the world continue to deteriorate. We have therefore implemented a “shared sacrifice“ approach involving temporary reductions of partner draws and associate, counsel, and staff compensation. Partners are leading the way, with the largest reductions.
Hopefully these salary cuts are enough to prevent the firm from conducting layoffs.
(Flip to the next page to read Pillsbury’s memo on salary cuts.)
If your firm or organization is slashing salaries, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).
If you’d like to sign up for ATL’s Layoff Alerts, please scroll down and enter your email address in the box below this post. If you previously signed up for the layoff alerts, you don’t need to do anything. You’ll receive an email notification within minutes of each layoff, salary cut, or furlough announcement that we publish.
Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.