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Corporate & Securities Law

: The Wired GC

Legal Secondments with a Twist

By John Wallbillich

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Mayer Brown is providing attorneys to key clients, according to the Chicago Tribune.

Secondments, involving law firms tasking attorneys to key clients for a defined term, are not new.

One part of this one is, however:

Mayer Brown is paying some of its associates to work in-house at corporate clients such as United Airlines parent UAL Corp. and Kraft Foods Inc. But there is a catch: The associates’ pay is reduced to $60,000 plus benefits, from about $160,000, and the jobs last one year with no guarantee of further employment.

It’s clear why some may like it:

UAL was a willing participant, said Paul Lovejoy, its senior vice president and general counsel. Why not? The company gets people with top credentials and good training for free and are under no obligation to provide a permanent position.
[…]
“These are well-qualified people,” Lovejoy said. “If they stay with us, we have the advantage of a nice, long tryout.”

I applaud Mayer Brown for coming up with a creative way of packaging a severance that helps the former associate keep working and helps a client (obviously a long-standing, major client) by delivering clear added value.

Assuming this is a one-way ticket from Mayer, Brown, it seems there are three options:

1. Client likes the former associate, and has a position. Hired.

2. Things don’t work out with former associate, for whatever reason. Gone, but with valuable experience.

3. Client likes former associate, but no positions open. Associate rolls over to another term, or hangs out a virtual shingle with a key anchor client. Associate & Associates, LLP.

Not sure if Mayer, Brown has given any thought to #3, but if it happens, it’s likely with work that they wouldn’t be able to keep long-term anyway with their current cost and pricing structures.

As with other data points in the global service economy, you can hear some of the helium leaking from the associate salary balloon. When the Chi-Trib writer notes that some of the “associates were making as much as $200,000″ and that a “first-year associate at Mayer Brown makes $160,000,” you know that’s not how things work for in-house counsel with limited experience.

Unlike the #1 movie at the cineplex today, the BigLaw starting salary trend is no longer Up.

Full post as published by The Wired GC on June 02, 2009 (boomark / email).