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The COVID-19 austerity measures that are tearing their way through Biglaw have claimed another firm. This time it is Crowell & Moring, who made $401,074,000 in gross revenue in 2018, making the firm 95th on the Am Law 100 ranking.
So here’s the scoop: there will be salary cuts at the firm, with the top echelons of the firm taking the biggest hit. Equity partners will take a 25 percent compensation cut, income partners will see their paycheck cut by 20 percent, associates and counsel are seeing a 15 percent cut, and staff who make $100,000+, which the firm estimates is about a third of staff members, will see cuts in the range of 5 to 20 percent.
Philip T. Inglima, chair of Crowell & Moring, had the following statement on the austerity measures:
Crowell & Moring is in very good financial health, with a balanced array of practices and revenue streams. Over the past month, we swiftly transitioned our people to an almost entirely remote work environment, as we continued meeting our clients’ needs, including those that have arisen from the COVID-19 pandemic.
We are taking prudent and responsible steps to keep our firm strong as we, and our clients, navigate the economic uncertainty and challenges stemming from the COVID-19 pandemic. In addition to aggressively managing all expenses that we can forgo or defer, we will postpone distributions and adjust partner draw levels for the months ahead in 2020. We also will institute tiered compensation reductions for all non-partner attorneys, as well as a segment of our professional and administrative team, for the balance of the year. These adjustments avoid any lay-offs and mean that two-thirds of our staff are spared any reduction in compensation.
We are positioning our firm to meet our current and anticipated financial and operational needs and to keep our team intact. We look forward to returning to our prior compensation practices as soon as possible.
These proactive steps are consistent with what every business must do during this unprecedented time: contain costs and expand cash resources to weather the storm. By taking these actions now, we are confident that we will be able to continue providing outstanding service to our clients and to support our people. We will get through this challenging time together.
Points to Inglima for coming right out and saying the cuts should be enough to avoid layoffs. It’s awful when firms realize their first round of austerity measures weren’t enough to save jobs. Here’s hoping Crowell can avoid layoffs.
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Kathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).