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Don’t look now, but worries over the financial impact of the novel coronavirus have infiltrated yet another successful Biglaw firm. As we’ve noted time and again, no matter how impressive a firm’s gross revenue is, austerity measures may be coming down the pipeline thanks to the unrivaled havoc that COVID-19 has wreaked upon the world’s markets.
Today, we have news from Eversheds Sutherland, a firm that was declared the 10th best legal practice in the world in Law360’s most recent Global 20 rankings. It seems that the international firm’s U.S. branch is slashing salaries across the firm and furloughing employees. Specifically, the Eversheds equity partners will “lead the way” when it comes to reduced compensation, taking smaller distributions, and both lawyers and staff will face a 10 percent pay cut on average (including bonuses). Those who earn $50,000 or less will not have their compensation reduced. In addition, 40 staff members — about one-third of whom can’t do their work remotely — will be furloughed for three months’ time thanks to the pandemic.
On top of these COVID cuts, the firm plans to defer the start date for its incoming first-year associates to January 2021, and will be hosting a shortened summer associate program online. All law students who take part in the remote summer program will receive full-time job offers.
“[A]s we look at the economic news and listen to our clients, we are planning for future reductions in work. I think this is an appropriate, prudent preparation for the future, given everything we’re seeing,” Mark Wasserman, the firm’s U.S. co-chair, said in an interview. “We’re preparing for what we think will be less work for the short term. We don’t want to be caught off guard. We can always dial [these measures] back if there is a faster recovery.”
On the bright side, the firm has an employee relief fund that those facing unforeseen hardships — like furloughs — will be able to take advantage of these difficult times.
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).
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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.