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Revisiting California Associate Compensation

This article explains that prominent California law firms (including many OCIP participants) are revising their lock-step salary models. While salaries and bonuses aren't expected to change immediately, the way they're doled out might, as California firms consider switching from a lockstep associate compensation model to others based on skill level. Why would they do this? Because, according to the article, associates are becoming more savvy to the realities of the economy and its attendant layoffs (read: vulnerable), and firms are beginning to tinker with compensation plans and other intangible aspects of the job.

"I hear . . . more and more from partners that they can't give first-year associates work," said one recruiter in Los Angeles. "Clients can talk to a young associate and figure he or she doesn't know what he or she is talking about, and they say, 'We don't want to be serviced by younger associates. We don't want them going to school on our nickel.'"

The plan strikes me as a perfectly reasonable way to address non-performers, and to curb a sense of salary entitlement among recent grads: once a firm pays $160,000 to first year associates it may be hard to go back. That doesn't require the firm to pay a penny more at year two. (Am I insensitive?)

On a side note, the article is based in part on a polling of compensation plans at California's 25 top-earning firms. The results are of that poll are locked away behind a "premium subscription," which costs over $200 per year. If you have access, I'd be grateful for a peek. Please e-mail me.

Full post as published by Nuts & Boalts on September 10, 2008 (boomark / email).