K&E made its reputation with associates by offering above-market bonuses. The firm swims in cash and makes its largesse a key recruiting point, promising associates a healthier bank account at the end of the year. This year, Kirkland managed to beat the prevailing market bonuses again, but associates aren’t particularly happy about it.
Kirkland is among those firms that refuse to offer lockstep bonuses or even lockstep bonuses with a discretionary kicker. Instead of providing the market transparency that associates can rely upon, K&E hands out individualized bonuses leaving associates to wonder if they’re making more, less, or the same as their peers. More importantly, it leaves Above the Law wondering if any individual tipster is representative of the firm’s policy or not. That’s why tips from associates are even more essential at black box firms.
First, the good news. Based on what we’ve received, associates working in the 2200-2400 range are routinely getting between 1.2 and 1.3 times the standard Milbank scale bonuses. There’s a lot of variation in between those poles, but most tipsters seem convinced that they’re falling somewhere in that range.
Normally, a market-beating bonus would be enough to salve associates, but folks at Kirkland have a keen sense of history and are aware of a troubling trend when it comes to comp. A few years ago, the firm was handing out 1.4x bonuses and set a 1.05x “floor” that no associate could fall below. Last year, the floor was gone and associates reported receiving between 1.25-1.33x. Now the tips we’re getting hew mostly to the 1.24-1.27x range. Is the firm regressing on comp while it continues to surge in revenue? Associates seem to think so.
A 2016 in the meat of the range reports that “people are generally very unhappy about bonuses” and a 2017 points to the considerable hours billed and notes that Katten Muchin would have paid an extra $7K for the effort. There haven’t been any complaints about Timmy in the office down the hall getting more for doing less. Though that’s probably bad news for the firm that associates are more annoyed with the trend in bonuses generally to be troubled with a black box spitting out disparate bonuses for the same level of work.
Kirkland is still paying above market, and associates are still generally happier to make more than less. But when associates start to wonder if the good times are leveling off, they start to ask whether it’s worth it to push themselves at a firm like Kirkland when they could make almost as much somewhere else. And for a firm that’s spent years waving cash to win the talent wars, that’s not a positive development.
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Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.