Big Law: Is Stalin-Like Purge Now Overdue for Those Abundantly Compensated Associates? (meanwhile, what worker doesn't have a quota these days)

"A lot of chairs feel that slower deal flow, softer economy and softer performance in many firms ... gives them cover to address areas of weakness in their firm that were harder culturally to address in a strong economy. What I hear chairs and managing partners indicate is they’re thinking about cleaning up." - Law-firm consultant at Zeughauser Kent Zimmermann quoted by the American Lawyer, October 2022

Will there be a Stalin-like purge targeted at highly paid associates in law firms? That would make good business sense. Eliminate enough of those associate annual salaries, which start at 215k and quickly rise to nosebleed levels, and Profits Per Equity Partner can continue to grow. That would be despite the slowing global economy and falloff in demand in a variety of practices. Such a strategy would prevent:

• Throwing shade on the brand by a decline in PEP. Those statistics are made public.

 

• The flight of star partners to firms which can cough up the level of monetary rewards they expect. All professional services operate on star power. In a Bloomberg Law interview chairperson of Paul Weiss Brad Karp hammered that law firms without the resources (think money) to recruit, retain, and motivate that kind of wattage could actually fold. Karp's signature is as a master poacher.

The purge could easily be accomplished without an official layoff. Read professional anonymous networks such as Reddit Big Law and Fishbowl Big Law and the universal lament is not enough hours to meet the quota. Making quota is the deal, right.

 

Increasingly common is this kind of post on Fishbowl:

 

"I'm having a legit panic attack thinking I'm about to be laid off and i can't stop thinking about it. I have no work and I have a sneaking suspicion that it's over for me."

 

Here is the thread in which the advice is to polish the resume and push hard on recruiters. 

 

You bet, all the freeing up of the funds that had been locked in associate salary can be done via the performance review. Not enough hours billed? That’s the box which didn’t get crossed.

 

If those forced out are fortunate they might get a month of severance and have their profile still up on the website for up to three months. Not everyone is lucky.

 

Could the number of junior associates (and non-equity partners as Kirkland & Ellis allegedly included in good-byes in 2009) be as massive as back in The Great Recession? That no longer seems unthinkable, as it had been just several months ago. 

Back then some partners were reassuring associates that demand such as in M&A would pick in Q4 2022. Generally that hasn't played out. Some practices in some firms are busy. But overall there are plenty of pockets of slowness. Usually there is a time lag between the lack of business and impacts on impacts. Currently, those impacts have become overdue.

 

If the terminations result in a glut of legal talent out there it could be a version of musical chair. Some of those pushed out won't be able to make it back there into the legal sector. When I lectured at the New York State Bar Association in 2009 to unemployed lawyers I recommended that they consider analyzing how they could redefine their experience and skills for other career paths.

 

Meanwhile, establishing quotas is becoming more standard in how we earn a living. One source of my career coaching/tarot-reading practice is as a contractor. That firm which is contracting my services has a monthly 50 client sessions quota. And that's that. It is irrelevant how overall demand is. 

 

Takeaway: We are all in this together. Help your fellow human beings get, hold, and move on to better work. 

 

In transition in your career? Need more income? Healing from a professional setback? Intuitive career coaching.

“On the menu” of services are Tarot readings, both spreads and one-card pulls. Complimentary consultation.

Please contact janegenova374@gmail.com or text 203-468-8579.