The news earlier this month of increased associate salaries at multiple top-tier law firms has sparked curiosity among observers as to whether this trend is likely to spread to other players in the industry. As reported in the New York Law Journal, it appears that boutique firms are among those making the leap, something which comes as a bit of a surprise.
Several boutiques in the litigation realm have announced that they plan to match the $190,000 starting salary salvo launched by Milbank, Tweed, Hadley & McCoy. Among them are Chicago’s Barack Ferrazzano, Kirschbaum & Nagelberg and Hueston Hennigan of Southern California. Rumors of Susman Godfrey moving associate pay beyond the already eye-watering $190,000 level have also begun to take root.
The smaller firms in question tend to hire a comparatively limited group of associates every year, with those candidates possessing stellar qualifications from elite schools. However, it is the simplified leadership hierarchies of these firms that enable them to meet market trends swiftly, absorb expenses more effectively and remain competitive when it comes to attracting top talent.
Smaller, boutique firms are well aware of the massive amounts of student loan debt so many new recruits have at the start of their careers. As such, managing partners are seeking to ensure that pay is not among the primary reasons a prized candidate decides to go elsewhere.
Many boutique enterprises have been able to raise associate pay levels without instituting a concomitant, and likely unpopular increase in client rates. Several such firms have explained that associate raises were essentially baked into their overall financial strategy, something which incorporates a fair amount of budgetary flexibility and far fewer bureaucratic hoops than larger firm structures.
In the end, because of the need to attract the best and brightest young legal minds and to foster an atmosphere in which long-term employee retention is assumed, it appears likely that firms in this category will do whatever it takes to keep pace with the giants.