Debevoise gives higher bonuses than Cravath? Who saw that coming?

SHOW ME THE FIRST

Up on ATL in under half an hour. Nice work Lat.

...and still beat by WSJ.

2:46 - not really: class of 2000 for cravath is up for partnership. not so at debevoise so they need to provide more carrots to entice them to stay longer

Now the question who is not going to match the special bonus.

2:52 Don't be ridiculous. Very very very few ppl in Cravath's 2000 class will make partner. Long run income, you're better off going to a firm who makes more partners, but pays lower bonuses.

YES!

Thank you, D&P.

Now all firms that consider themselves among the elite MUST match or concede they are second tier.

God Bless America. I'm buying a Porche.

"I'm buying a Por[s]che."

----

Me too.

im learning to spell porch. or did you mean porsche?

I am only getting a fractional bonus, so I am going enter into a swap which gives me synthetic long exposure on a Porsche

This structure forces any firm that ties bonuses to hours to look very second tier. They may not even be motivated to match the total at year's end.

Stupid question, which I'm sure will evoke ridicule from the masses:

Does the "class" year typically correspond with year of law school graduation (e.g., an '05 grad who clerked for a year before going to the firm would get $40,000 even if s/he didn't start at the firm until 2006?)

Me fail English? Than unpossible!!

@3:02

Diversify yo' bonds, n*gga.

3:04. That's correct. Your grad year = Your class year, regardless of when you started at the firm. Likewise, your salary at the firm will be tied to your grad year: People who are in their first year as a firm associate, but who spent the past year clerking, are considered and paid as second year attorneys.

jones day? bonuses? secret system?
whats up wit dat?

3:04, generally yes, that generally corresponds with graduation year. As to clerkships, it could be case-by-case with each firm. When a firm hires you from a clerkship, it will tell you what year you are coming in at. I know people that clerked for 2 years that have only gotten credit for one year. So even though they graduated in 2005, they came in as second-years and got the 2006 class pay.

3:04, that's usually correct. If an attorney laterals into a firm, though, it's not uncommon for the firm to dock him or her a year in status as the price paid for joining a better firm and not coming up through the ranks.

What about Simpson? Will Simpson match? Will they too pay the special bonus in November? Since 2 peer firms are paying the special bonus in November, it seems like STB needs to as well.

Any dirt on STB? Thanks!

Hold your horses, guys. STB is coming soon.

Note that D&P is issuing these bonuses for the DC office in addition to NYC. Wow - big-time payday for DC folks. Questions as to whether DC-based firms will be able to match these numbers (in their DC hq, at least).

http://www.nytimes.com/aponline/us/AP-Ex-Commissioner-Sued.html

Fulbright & Jaworski sues Bernard Kerik for legal bills...

http://www.nytimes.com/aponline/us/AP-Ex-Commissioner-Sued.html

Fulbright & Jaworski sues Bernard Kerik for legal bills...

Match, bitches.

http://www.nytimes.com/aponline/us/AP-Ex-Commissioner-Sued.html

Fulbright & Jaworski sues Bernard Kerik for legal bills...

Of course they're paying it for the D.C. associates. Debevoise has one of the purest lock-step systems around - up to and including at the partner level.

@3:17

Just wait until Skadden matches this across all their offices. Some 2nd-year associate in Wilmington, Del. is gonna bring a suitcase full of Benjamins to his house closing.

Straight cash, homie!

does anyone know whether fulbright will be suing bernard kerik for legal bills?

What percentage goes to Charlie Rangel?

My guess is that Simpson will match. I don't think they want to be viewed as 2nd to anyone in compensation (except, of course, Wachtell). Given how rich the bonuses are, I would guess that base salaries will also climb. Skadden is probably non-plused that they had to follow Simpon's last raise rather than leading it, which may also put upward pressure on salary.

3:13 is incorrect. It's highly uncommon for laterals to get docked - unless they switch practice groups.

If anything, laterals get generous bonuses for switching firms as an inducement to jump ship.

@3:23

In what world does your comment make sense? Don't get me wrong, it's not that I wouldn't like to believe that salaries will rise, I just don't see how high bonuses increase pressure to raise salaries. I'd say the opposite is true.

for predicting who will match (westlaw cites).....

profits per partner- 6/2007 AMLAW 151

revenue per lawyer- 6/2007 AMLAW 147

Laterals may get docked in class year for partnership, but not in pay.

256: actually anyone at cravath who has lasted to class of 2000 probably has a good chance at partnership since hints are given along the way about their odds of making election

I WANT YOUR BOOOONNNUSSSSESSSS!!!!!

The special bonus is clearly an alternative to raising salaries. Give 'em an extra $10k because we had a good year. But next year may be different because of the credit crunch / subprime mortgage market. It's a lot easier to change the bonus pay than base pay. In fact, firms don't reduce base pay, they lay people off.

Agree w/ 3:26.

So every associate for these years gets the exact same bonus, regardless of hours worked, etc.?

BUT WHEN WILL SIMPSON ANNOUNCE? LATER TODAY? TOMORROW??

Not that it isn't fascinating to see which BigLaw firms pony up the big bonuses and in what order, and not that it isn't fascinating to hear about the small-penis-compensating car the associate receiving said big bonus will buy, but how about a thread that relates to (what I assume is) a larger portion of the legal community -- the bonuses that are typically given at smaller sized firms? I.e., it would be interesting to hear what the average bonus is for firms with 1-15 attorneys, 15-50 attorneys, 50-200 attorneys, etc. or whatever delineated group you want to choose.

3:17: How soon will STB announce???? We need to know

I wonder whether Kirkland's famous above market bonuses will top these recent announcements. Any thoughts?

Now that Debevoise has match (and even topped for senior associates) every firm that does not want to be deemed second tier must do so as well. Skadden, STB, DPW, Cahill, Milbank, CWT, etc., all must all match. None of these firms want to been seen as inferior to Debevoise in terms of prestige or status. Even if if few of these firms, if pushed, would admit that they are not quite equal to Cravath, none will allow themselves to be seen as beneath Debevoise. That would be too embarassing.

P.S.: they must also match in their branch offices - as Debevoise did.

3:38 -- I can tell you what most 1-15 attorney firms will hand their associates as a bonus: a $20 gift certificate good at any Olive Garden location (excluding alcoholic beverages, of course.)

Since I have been here (several years) I have been told, repeatedly, that the firm will always "do the right thing" when it comes to comp. So far, so good.

I officially bestow the title of TTT on any firm that does not match.

How many times will you people ask whether bonuses are linked to hours? Are you all under the same rock somewhere, or are there several rocks around the city? Just wondering.

What kind of bonuses do Lewis Hamilton-loving London firms pay their associates?

341-
Is that what your firm gave you last year? Interesting. Perhaps if you spent more time working and less time blogging, the firm would have given you more. By the way, you should post which firm it is, so the rest of us know to avoid that firm if we look to lateral. Seriously though, I'd like to hear from people who have something meaningful to say. Your comment, not meaningful.

Weil just matched

@3:22

"Benjamins"?? "Homie"???

Hi, 1997 called - It wants it's slang back.

What is taking Simpson so long? It just got showed up by Debevoise! Are you f'ing kidding me?

They need to announce TODAY.

What kind of bonuses do Lewis Hamilton-loving London firms pay their associates?

What kind of bonuses do Lewis Hamilton-loving London firms pay their associates?

Pls clarify on the lateral bonus info--suppose you lateralled in August 2007, and the firm's fiscal year ends June 30. Would you be included in this bonus round prorated for Aug-Dec 2008 (like the stubs), or is it zilch until 2008?

What kind of bonuses do Lewis Hamilton-loving London firms pay their associates?

What kind of bonuses do Lewis Hamilton-loving London firms pay their associates?

@3:22

"Benjamins"?? "Homie"???

Hi, 1997 called - It wants it's slang back.

Sorry at 3:48 I meant prorated Aug-Dec 2007 (not 2008).

Simpson Thacher & Bartlett llp

MEMORANDUM TO ALL ASSOCIATES AND COUNSEL

On behalf of the partners of the Firm, I am pleased to announce both a Special Bonus for 2007, as well as the year-end bonuses for associates and counsel. Associates in good standing will be paid as follows:

Year End Bonus
Special Bonus

Class of 2007 $35,000 (pro-rated) -
Class of 2006 $35,000 $10,000
Class of 2005 $40,000 $15,000
Class of 2004 $45,000 $20,000
Class of 2003 $50,000 $30,000
Class of 2002 $55,000 $40,000
Class of 2001 $60,000 $50,000
Class of 2000 $65,000 $50,000
Class of 1999 $65,000 $50,000

Bonuses for counsel and other attorneys will be determined on an individual basis and communicated separately. Special Bonuses will be paid on November 30, 2007 and the year-end bonus will be paid on December 28, 2007. Associates and counsel who were on leave or worked part-time during any part of this year will be eligible for a pro-rated bonus.
On behalf of the Firm, thank you for your continued dedication and professionalism. You have all contributed to the Firm's extraordinary success this year.
Pete Ruegger
October 31, 2007

The jerk store called. They're running out of 2007 son.

Weil has NOT matched.

3:50(2): You need to get out of the office more.

Simpson matched

Shall we assume that 3:46(3)'s post is bogus?

Simpson matched

Simpson Thacher & Bartlett llp

MEMORANDUM TO ALL ASSOCIATES AND COUNSEL

On behalf of the partners of the Firm, I am pleased to announce both a Special Bonus for 2007, as well as the year-end bonuses for associates and counsel. Associates in good standing will be paid as follows:

Year End Bonus
Special Bonus

Class of 2007 $35,000 (pro-rated) -
Class of 2006 $35,000 $10,000
Class of 2005 $40,000 $15,000
Class of 2004 $45,000 $20,000
Class of 2003 $50,000 $30,000
Class of 2002 $55,000 $40,000
Class of 2001 $60,000 $50,000
Class of 2000 $65,000 $50,000
Class of 1999 $65,000 $50,000

Bonuses for counsel and other attorneys will be determined on an individual basis and communicated separately. Special Bonuses will be paid on November 30, 2007 and the year-end bonus will be paid on December 28, 2007. Associates and counsel who were on leave or worked part-time during any part of this year will be eligible for a pro-rated bonus.
On behalf of the Firm, thank you for your continued dedication and professionalism. You have all contributed to the Firm's extraordinary success this year.
Pete Ruegger
October 31, 2007

stb just matched

Franks & Beanz LLP just matched.

Weil has matched.

Stupid Debevoise. Now that they've matched, every firm in the V15 HAS to match; they have no choice. Kills all the suspense. Talk about your all time bone head play...

Simpson just announced - matched Debevoise all the way.

stb just matched.

Simpson Thacher & Bartlett llp

MEMORANDUM TO ALL ASSOCIATES AND COUNSEL

On behalf of the partners of the Firm, I am pleased to announce both a Special Bonus for 2007, as well as the year-end bonuses for associates and counsel. Associates in good standing will be paid as follows:

Year End Bonus
Special Bonus

Class of 2007 $35,000 (pro-rated) -
Class of 2006 $35,000 $10,000
Class of 2005 $40,000 $15,000
Class of 2004 $45,000 $20,000
Class of 2003 $50,000 $30,000
Class of 2002 $55,000 $40,000
Class of 2001 $60,000 $50,000
Class of 2000 $65,000 $50,000
Class of 1999 $65,000 $50,000

Bonuses for counsel and other attorneys will be determined on an individual basis and communicated separately. Special Bonuses will be paid on November 30, 2007 and the year-end bonus will be paid on December 28, 2007. Associates and counsel who were on leave or worked part-time during any part of this year will be eligible for a pro-rated bonus.
On behalf of the Firm, thank you for your continued dedication and professionalism. You have all contributed to the Firm's extraordinary success this year.
Pete Ruegger
October 31, 2007

Simpson has matched.

Its just hilarous the way these firms shamelessly copy each other. Not only with the structure, but they couldn't think of anything else besides "special bonus"? How about "Premium Bonus" or "One-time Discretionary Bonus" or "Firm Citizenship Bonus" or they could just cut to the chase and call it the "Cravath Bonus"

Stupid Debevoise. Now that they've matched, every firm in the V15 HAS to match; they have no choice. Kills all the suspense. Talk about your all time bone head play...

Simpson just matched!!!

Hi, the jerk store called - They're running out of 2007 son.

3:38,

Regardless of the size of one's penis, it is impossible not to agree that a Porsche 911 is a beautiful machine. That is a simple, indisputable fact.

Your snippy little comment is likely the result of your sadness over the equally indisputable fact that you will never drive such a beautiful machine, and certainly never have the chance to own one.

Leave your address in the comments and I will make sure to send you a few pictures of my girlfriend driving me around in the black 911 I intend to purchase.

Enjoy your Hyundai.

Weil has matched.

I work at a AMLAW 200 (not 100 firm) and I almost cried when I read this post. I'm a second year associate who only makes 135k a year. My bonus will MAYBE be around 15k tops. And the sad thing is I went to a top 14, but ended up at this TTT firm. I could be making 170k plus a 55k bonus if I had gone to NYC. Jesus, that is a 75k a year difference. Wow.

3:50(2): You need to get out of the office more.

3:38 - Go away. No one cares. Please go to an accounting blog and when people talk about PricewaterhouseCoopers, Deloitte Touche Tohmatsu, Ernst & Young, and
KPMG , you can be right there to ask questions about H&R Block and John Q. Accountant, CPA.

There's nothing wrong with midsize, small, or solo operations, but a) there are too many to talk about and b) they are not the ones that push the envelopes. When there's some trend worth talking about, you be sure to let us know. Why don't you quit your job and start a blog about it like Lat did after he left Wachtell/USA?

I hear STB matched

Simpson matched at 3:53 eastern.

Simpson has matched.

don't forget that flyout week just happened for harvard and yale and those students are all thinking about which firm to go to right now and reading this stuff.....can't differentiate between top firms anyway, so this kind of stuff might make the difference. firms clearly know this and want to step up. would make sense for one place, like stb, to go above and beyond.

simpson may have just matched

3:38,

Regardless of the size of one's penis, it is impossible not to agree that a Porsche 911 is a beautiful machine. That is a simple, indisputable fact.

Your snippy little comment is likely the result of your sadness over the equally indisputable fact that you will never drive such a beautiful machine, and certainly never have the chance to own one.

Leave your address in the comments and I will make sure to send you a few pictures of my girlfriend driving me around in the black 911 I intend to purchase.

Also, enjoy your Hyundai.

simpson may have just matched

simpson matches - see xoxo

What kind of bonuses do London loving-Lewis Hamilton firms pay their associates?

simpson matched

Simpson Thacher just matched, memo: http://www.xoxohth.com/thread.php?thread_id=709761&mc=1&forum_id=2

From: Ruegger, Pete
Sent: Wednesday, October 31, 2007 3:53 PM
To: Associates and Counsel
Subject: 2007 Bonuses

Simpson Thacher & Bartlett llp

MEMORANDUM TO ALL ASSOCIATES AND COUNSEL

On behalf of the partners of the Firm, I am pleased to announce both a Special Bonus for 2007, as well as the year-end bonuses for associates and counsel. Associates in good standing will be paid as follows:

Year End Bonus
Special Bonus

Class of 2007 $35,000 (pro-rated) -
Class of 2006 $35,000 $10,000
Class of 2005 $40,000 $15,000
Class of 2004 $45,000 $20,000
Class of 2003 $50,000 $30,000
Class of 2002 $55,000 $40,000
Class of 2001 $60,000 $50,000
Class of 2000 $65,000 $50,000
Class of 1999 $65,000 $50,000

Bonuses for counsel and other attorneys will be determined on an individual basis and communicated separately. Special Bonuses will be paid on November 30, 2007 and the year-end bonus will be paid on December 28, 2007. Associates and counsel who were on leave or worked part-time during any part of this year will be eligible for a pro-rated bonus.
On behalf of the Firm, thank you for your continued dedication and professionalism. You have all contributed to the Firm's extraordinary success this year.
Pete Ruegger
October 31, 2007

@2007 Son

Yo, beeyatch, a semi-retarded African boy called. He wants his poor Internet skills back.

Did Simpson match? Why won't anyone say??

From: Ruegger, Pete
Sent: Wednesday, October 31, 2007 3:53 PM
To: Associates and Counsel
Subject: 2007 Bonuses

Simpson Thacher & Bartlett llp

MEMORANDUM TO ALL ASSOCIATES AND COUNSEL

On behalf of the partners of the Firm, I am pleased to announce both a Special Bonus for 2007, as well as the year-end bonuses for associates and counsel. Associates in good standing will be paid as follows:

Year End Bonus
Special Bonus

Class of 2007 $35,000 (pro-rated) -
Class of 2006 $35,000 $10,000
Class of 2005 $40,000 $15,000
Class of 2004 $45,000 $20,000
Class of 2003 $50,000 $30,000
Class of 2002 $55,000 $40,000
Class of 2001 $60,000 $50,000
Class of 2000 $65,000 $50,000
Class of 1999 $65,000 $50,000

Bonuses for counsel and other attorneys will be determined on an individual basis and communicated separately. Special Bonuses will be paid on November 30, 2007 and the year-end bonus will be paid on December 28, 2007. Associates and counsel who were on leave or worked part-time during any part of this year will be eligible for a pro-rated bonus.
On behalf of the Firm, thank you for your continued dedication and professionalism. You have all contributed to the Firm's extraordinary success this year.
Pete Ruegger
October 31, 2007

FIRST!

simpson matched

Lat -

The site is screwed up. Double postings on the main page, missing pages, etc. do we all need to click an advertisement so you can get an upgrade?

Has anyone heard whether Simpson matched?

I heard Latham is matching soon

What about Simpson? are they going to match?

When is LW going to match?

FILTER THESE COMMENTS PLEASE

I think Lat murdered the site on his way to the gay cruise. Terrible timing. What a mongoloidal move.

I heard Simpson may be matching at some point in the next 3 months!

Rumors of a Dewey & LeBoeuf match?

I'm going to call the Chairman on my AmLaw 50 firm and tell him I want my special bonus paid in gold bars.

3:04, apparently not a dumb question at all, since there seems to be a lot of confusion on the matter. At most firms, "class year" refers to the class/level which firm considers an individual attorney, not that attorney's grad year. That said, some firms may not make a practice of hiring candidates who aren't on par with their YOG.

3:26, Laterals commonly get docked - both in salary and class year/partnership consideration - for a variety of reasons.

Interesting - what do you think about the big names in DC matching? Covington? WilmerHale? WC?

Rumors of a Dewey & LeBoeuf match?

One point I don't think anyone has touched upon:

All three firms are paying both bonuses prior to the end of 2007. Did they also pay their 2006 bonuses in calendar year 2006, or are associates getting all three boni within 12 months?

Will all firms match this as well? And what are the tax implications? God help me if I land in a higher bracket.

What is Debevoise ranked on PPP? This would be a better metric to determine who absolutely must match.

21 Debevoise & Plimpton $1,805,000 7.8%

400(#4)/404,
The Porsche is a very nice car (though I prefer the Lexus SC08), but I live in NYC, so I don't own any car at this point. I don't need a car, nor do I have a desire to compensate for other shortcomings by blowing $80 grand on one. And you can save the picture of your skank girlfriend. You'll need it to wack off to when she realizes why you bought the Porsche.

401(#3),
Why would I care about what is said on an accounting blog? I am a lawyer at a non-BigLaw firm. While I agree that there are too many small/mid-size firms to get a real representative sample, the discussion is still worth having. Here's why: (1) it will show those of you in BigLaw the options that are out there if you choose to leave for a small/mid-size firm. As this is a threat (promise?) that is repeated on these pages frequently, I would think you would want some sense of what the financial picture is at a smaller-sized firm. (2) The small firms do push the envelope - only its a slightly different envelope. Just like there is competition among the BigLaw firms for the best associates, there is competition among the small firms as well. When I took the job I accepted, I had other offers from similar size firms and I consulted with friends at firms of comparable size. I wanted to know whether the money was consistent with the small market. In essence, it's the same thing as someone in Atlanta, Seattle, or Tulsa having a thread for discussion.

I suppose the best way to find out if the discussion is worth having is for Lat to start a thread and see the response. Once you remove the idiots who cry "FIRST" and the denigrating comments from the BigLaw snobs, there might actually be some meaningful discussion. Or maybe not. Maybe no one from a small firm reads the blog, wants to post, or has the time. Only one way to find out.

Franks & Beenz LLP just matched!

screw DC and every other market other than NY. There is no way other cities should be matching NY.

Thoughts on whether firms that tie bonuses to hours will match this compensation scheme? As most don't pay bonus until the next calendar year, maybe we can look forward to a President's Day "special" bonus!

4:33-

do you know how the income tax works? if it bumps you into a higher tax bracket, that higher rate will apply only to the excess that bumped you into the higher bracket.

400(#4)/404,
The Porsche is a very nice car (though I prefer the Lexus SC08), but I live in NYC, so I don't own any car at this point. I don't need a car, nor do I have a desire to compensate for other shortcomings by blowing $80 grand on one. And you can save the picture of your skank girlfriend. You'll need it to wack off to when she realizes why you bought the Porsche.

401(#3),
Why would I care about what is said on an accounting blog? I am a lawyer at a non-BigLaw firm. While I agree that there are too many small/mid-size firms to get a real representative sample, the discussion is still worth having. Here's why: (1) it will show those of you in BigLaw the options that are out there if you choose to leave for a small/mid-size firm. As this is a threat (promise?) that is repeated on these pages frequently, I would think you would want some sense of what the financial picture is at a smaller-sized firm. (2) The small firms do push the envelope - only its a slightly different envelope. Just like there is competition among the BigLaw firms for the best associates, there is competition among the small firms as well. When I took the job I accepted, I had other offers from similar size firms and I consulted with friends at firms of comparable size. I wanted to know whether the money was consistent with the small market. In essence, it's the same thing as someone in Atlanta, Seattle, or Tulsa having a thread for discussion.

I suppose the best way to find out if the discussion is worth having is for Lat to start a thread and see the response. Once you remove the idiots who cry "FIRST" and the denigrating comments from the BigLaw snobs, there might actually be some meaningful discussion. Or maybe not. Maybe no one from a small firm reads the blog, wants to post, or has the time. Only one way to find out.

One point I don't think anyone has touched upon:

All three firms are paying both bonuses prior to the end of 2007. Did they also pay their 2006 bonuses in calendar year 2006, or are associates getting all three boni within 12 months?

Will all firms match this as well? And what are the tax implications? God help me if I land in a higher bracket.

Why would you ever let your girlfriend drive your new Porsche? That's an awful idea.

Thoughts on whether firms that tie bonuses to hours will match this compensation scheme? As most don't pay bonus until the next calendar year, maybe we can look forward to a President's Day "special" bonus!

does anyone know how the prorated bonuses for ppl who worked for part of the yr work? and im not talking about first yrs. i worked for the first 1/2 of this yr at a V10 nyc firm that HAS to match DP and STB but then left to clerk. will i get anything or do you have to be still assoc with the firm at yr end to get any piece of the bonus?

LAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAATTTTTTTTT!!!!

4:35/4:39

Just tell us what your base salary is, and then we can all judge for ourselves whether you work at a prestigious boutique or do crap PI work. If it's closer to the latter, then no, no one here cares what your bonus will be.

4:39 -

It would be annoying (and costly), however, if the concentration of bonuses all in one year caused you to go into the higher bracket. If you were in the 25% bracket without the concentration for both years, but you got pushed into the 33% bracket for the year with the concentration (but stayed at the 25% bracket in other years), the timing difference will cost you, even if it only applies to the extra amount in the higher bracket.

does anyone know how the prorated bonuses for ppl who worked for part of the yr work? and im not talking about first yrs. i worked for the first 1/2 of this yr at a V10 nyc firm that HAS to match DP and STB but then left to clerk. will i get anything or do you have to be still assoc with the firm at yr end to get any piece of the bonus?

443 -- you have to be an associate in good standing to get a bonus. If you leave, you're not an associate in good standing. You get zero.

338 -- I agree that the discussion concerning small/mid size firm bonuses is worth having. However, the risk of divulging that information is substantially larger for a small firm associate than an associate at large firms. It would be fairly easy for small firm managers to find out who forwarded ATL information on the bonuses they pay. I don't know that I'd risk losing the trust of partners at my firm (or worst), just to further this interesting and enlightening discussion.

i was just thinking that 4:35(2)/4:39(2) was a pretty interesting person, bringing both high quality insults and meaningful insights to the table. then he blew it by posting twice (internet skills are wiggity whack). i would have been able to get over even that, however, until he insulted the FIRST posters. i have never posted "first" on this or any other site, but to say that shit's not funny/important is just plain wacky

449

I have even promised myself that I will go outside to see sunlight - for the first time since law school graduation - on the day that I succeed in posting FIRST on ATL. It is a dream I can only aspire to achieve.

4:45-

so say they paid the special bonus january 1. you would actually be getting more compensation, both salary and regular bonus, next year. so, you will be even more into the higher tax bracket next year. at best it would be the same tax treatment next year, so what's the difference? at worst, you are in an even higher bracket next year.

WHat does Lat mean by this is the last you'll hear from us for a little while? What is a little while? Tomorrow? Friday?

LAST!

HAHAHA

My bonus may be smaller then yours....but I still get $160,000 a year and get this........I'm leaving work now! 5:03pm on a Wed.

hahahahaha

former biglaw assoc

I would be very surprised, if not shocked, if any firm paid you a bonus pro-rated for the time you were at the firm (if you left before the bonus was announced/paid). Bonuses are paid to associates "in good standing" (i.e., still employed at the time it is paid).

Maybe it's the warm Halloween weather, but I feel a little Billy Merck coming on.

Special Bonus = Don't bet on it next year with market contraction!

Would be much more exciting (and enriching to what associates net after taxes) if the raise was in base pay.

Clerks and other FORMER associates get no bonuses at all (no matter how long you you worked at a frim during the year. You must be a currently employed associate in good standing. if you work all year and leave the day before bomus payments; no bonus at all.

Sorry.

And, fyi -- starting next year, the federal judiciary abolishes salary matching for law clerks. So, all you former firm types take a 2/3 paycut (from $160k to $59k) to do all the work for a cranky old jurist who thinks you're his slave for the year.

Nice.

4:54 -

The problem is if they double up two bonuses in one year - it will artificially bump up that year for income tax purposes and can throw you higher. If they stay consistent from year to year, then there is no problem.

For example, if a 2nd year associate last year had his bonus paid out last January (35,000), as well as this year's bonus paid this December (55,000), in addition to the regular salary (170,000), he would have a taxable income of 260,000 for the year. Next year, as a 3rd year associate, if the firm paid out bonuses in December again, he would only have income of $230,000 (assuming $185,000 salary + $45,000).

Depending on whether the concentrated bonuses cause the associate to go into the next tax bracket, it could make the difference of a few thousand dollars in tax liability.

It's only an issue, though, where firms aren't consistent and change when bonuses are paid. Otherwise, it is a steadily increasing income over time.

It would have an opposite effect if all firms paid bonuses in January.

This is ridic, man. The site doesn't work!

Also, too bad STB hasn't matched yet.

Clerks and other FORMER associates get no bonuses at all (no matter how long you you worked at a frim during the year).

You must be a currently employed associate in good standing to receive a bonus. This, if you work all year and leave the day before bonus payments, you get no bonus at all.

Sorry.

And, fyi -- starting next year, the federal judiciary abolishes salary matching for law clerks.

So, all you firm lawyers heading to clerk remember, you're taking a 2/3 paycut (from $160k to $53k) to do all the work for a cranky old jurist who thinks you're his slave for the year.

Nice.

I think one thing people are ignoring is whether Simpson matched. Did they? Somebody? What about Latham?

Look: 5:06 doesn't understand how taxes work, either.

Sidley? Latham? Skadden? S&C? Where are your bonus memos!

Latham will not match anytime soon.

444,
I'm sorry to hear that your girlfriend cheats on you. Because I am at a small firm, I recognize 448's point. I won't say exactly what I make b/c it will make it to easy to track me down. I will say this: I make 6 figures (though not BigLaw $$) and I do not work at a PI firm or an ID firm.

448,
Alas, I think you may be right that the size of the firm will make it impossible to have the discussion. But at the cost of someone space on a blog, there is no harm in trying it out.

449,
I would retract the comment about the FIRST posters, but it is really annoying. Blame the site for the double post; I didn't double click. It's been doing it all day.

Isn't the class of 2006 going to get screwed tax wise? I just checked and the 28% bracket caps at $160,850, so won't this special 10K bonus paid now bump all the class of '06 people into the next bracket?

5:06 - Our bonuses are not treated any differently from salary, for purposes of income tax. Thank goodness for that.

What would suck is if they repeal AMT for 2008 and we got stuck with all this extra income in 2007, subject to AMT. Cravath should have consulted with Charles Rangel before they put a date on when the bonus would be paid.

Others have asked, but haven't received a substantive reponse: How exactly are these numbers applied?

Do bonus numbers generally apply to anybody who hits the minimum (i.e. if you hit the minimum, you get the full bonus amount)? Then bonuses get even bigger if you worked more hours? Or is this the maximum you can get for hitting, say, 2400 hours? Do you even get a bonus if you hit the bare minimum (i.e. 1950-2000)?

Information about this would be appreciated.

338, just tell us where you work of shut the fuck up.

4:45, 5:12-

ok, i see what you're saying; i didn't get it before because i didn't think this was even a possibility. it was my understanding that the special bonuses will be paid in november and the regular bonuses will be paid at the regular time, whether that be december or january.

my original comment, at 4:39, was assuming that the original poster was worried that the special bonus would put him into a higher bracket, and not worried about the inconsistencies in timing you were talking about. using my assumption, say the poster's bonus was $10,000. if that bumps him into the next bracket, exceeding the threshold by, say, $5,000, then the higher tax rate will apply only to that $5,000, not the rest of his income. therefore, it is ridiculous to worry about getting bumped into a higher bracket. it is more money either way. sucks that that $5,000 will be taxed at a higher marginal tax rate, but its still an extra, albeit taxable, $5,000.

most nyc firms don't have minimum billables requirements for bonuses.

also, I can't post on the Simpson matched entry, but I heard Simpson matched.

Lat, get Merck or that gay Frenchman to fix the site. Surely somebody's on standby in case you post a dead link.

"Isn't the class of 2006 going to get screwed tax wise? I just checked and the 28% bracket caps at $160,850, so won't this special 10K bonus paid now bump all the class of '06 people into the next bracket?"

5:25--assuming you're correct (I have no reason to doubt that you are)--so what--so the income over 160850 will be taxed at a higher rate. Doesn't screw anyone. When you get bumped into a higher bracket, you don't lose money--all the money you earned below that amount is taxed at the progressively lower rate. Otherwise progressive taxation would create some perverse incentives.

All you morons who don't understand how bonuses are taxed (excepting the person who pointed you that it will hurt you if you get two bonuses in the same tax year) and who keep asking when you are eligible for a bonus need to go away. If you have been around this stuff for any period of time (even reading message boards while in law school) and don't understand yet how it works then you are pretty much never going to, so shut up. I would not believe that someone is asking whether you get a bonus if you don't work there anymore unless some moron were actually asking it.

5:25-

read 2nd paragraph of 5:28 post. aren't all law students encouraged to take federal income tax?

Ok, all the discussion on taxes needs some clarification.

Last year, and basically all other years, the top firms in NYC who do not tie bonus to hours paid their bonus in December. As far as I know there were only a couple of exceptions. Weil pops into mind. However, most paid out in December.

Thus, this year it is just like having a larger bonus, so there aren't any tax implications.

Also, I think a few of you are having trouble understanding the concept of marginal rates. If you make $170,000 instead of $160,000, only the $9150 above $160,850 is taxed at 33% or whatever the next highest marginal rate is. The extra $$ does not effect the amount of taxes that you paid on the first $160,850, however.

Of course the AMT throws a big monkey wrench into the whole equation, but, the bottom line is that extra $$ is extra $$, even if it gets taxed at a higher rate as the total income level gets higher.

Now, of course, if this year's bonus were to be paid in January, it would technically defer the tax a year, but since taxes are deducted from payroll anyway, it's not that much of an issue. Further, you would get the 6.2% social security tax taken out of the January bonus, but you would reach your threshold level earlier in the year, thus your paychecks would get bigger in May instead of July, so that is a wash, too.

Tax Experts, Aren't bonuses taxed at a higher rate than base income?

5:27-

I have the same question. It can't be that all associates within a year are paid the exact same bonus regardless of whether you bill 1950 or 2700, right? So how do the numbers break down?

Anybody?

5:41 - Actually it is exactly how you describe. There are whispers at some firms that big billers get a lil something extra, but basically whether you are in structured finance and are on pace to bill 2800 or are in bankruptcy and are on pace to bill 1500, you're getting the same bonus at most top firms

5:40-
no. income is income.

For those who don't know, here's a list of firms that have lock-step bonuses that are not tied to hours (except for Skadden which I think has some really low minimum):

Cleary
Cravath
Davis Polk
Debevoise
Milbank
Paul Weiss
Shearman
Simpson
Skadden
Sullivan
W&C
Willkie

I'm pretty sure they pay the same bonus in every office. They all had the same bonus last year. Expect them all to match this year.

For a bunch of corporate lawyers, you all seem pretty clueless about how tax brackets work. When you pass the threshold and enter a higher bracket, only the amount you earned in excess of the threshold is taxed at the higher rate. If that weren't the case and your ENTIRE income was taxed at the higher rate, there would be situations, at the margin, in which you would actually have a disincentive to work. Uncle Sam may be a pain in the ass, but he's not stupid (unlike some of the Esq's on here....)

Fried Frank does not have a min hour requirement

Skadden's minimum for bonus is 1600. Note that 1600 hours would get you fired from many of these firms.

5:41 and 5:44-

Thanks for the information. But how about for firms not on that list but are still in the Vault 50 (closer to the 50 than to the 1)?

Or do they not even "announce" like the firms on that list?

5:40 - It just seems that way because your paycheck that included your bonus is taxed as if you make that much every pay period. But it all evens out when you file and the bonus is taxes as ordinary income.

5:45-

thanks for making the same exact point that about 4 people have already made. enlightening.

hi

I ha

5:44:

As far as I know, Weil belongs on the list too.

1) Thank you 5:35 for saving me the effort of typing it out what marginal rate taxation means.

2) Any news on other NY top 10 firms?

3) If firms with Texas/MidWest offices match across their firms, there are going to be some retardedly wealthy people with little to do with their money -- other than buying obscene amounts of illicit substances.

This discussion raises two obvious questions:

1. If I never worked at these firms, can I still qualify for these bonuses; and

2. Are bonuses taxed at a higher rate than other income?

Wait. I'm confused. A few questions:

1) Does this mean I'm going to make less after taxes because I'll get bumped into the next bracket?

2) When is Simpson going to match?

3) So what kind of bonus do people get that bill in the 2700 range?

5:44 - does Latham tie bonuses to hours then?

good question. i heard bonuses were taxed at twice the rate as regular income...

Yo, I be runnin' my own crim law practice hea, and it be payin' real good. Wit da credit crunch, da pimps can't ho their ho's on credit and da adics aint buyin' on credit no mo. So, evry 1 is poppin' caps in each oda's ass. Free fo' all. Keepin me busy. Just put some of dem fliars on windshields in da hood an get me some of dem clients. My bonus dis year is measured in kilos... Worth lots mo dan yo' big firms..... Can yo job match dat?

The firms say they aren't tied to hours, and they arent. but not everyone gets the same bonus, even at lockstep firms.

Dah, if only work weren't as slow as it is!!

6:00 - nope. Income IS income. The difference is you have to pay 100% of the FICA and medicare taxes on bonuses. But, we'll all be screwed starting in 2011 unless congress acts to extend the Bush tax cuts....

Read the previous postings before asking questions that have already been answered.

5:35 - You're missing one thing. Let's say Weil (who paid its last bonus in January 2007) joins CSM, STB, and Debevoise in paying both new bonuses in November and December 2007.

In this case, some (possibly all) associates' 2007 income would be higher than their 2008 income. In some cases, this would push 2007 income into a higher tax bracket, where if the boni were paid in separate years, the higher level might not be reached.

Paying thousands more in 2007 taxes hardly seems worth getting the money a month earlier. I hope Weil et. al have enough sense to space the boni out properly.

I wonder what a thread like this ends up costing clients in total when you consider all the billable time being spent on it.

603 - look up the definition of a joke

BUT WHEN OUR BONUSES PUT US IN A HIGHER TAX BRACKET WE'LL ACTUALLY LOSE MONEY111111!!!!1SW21WHJD

Please answer the following questions!

1. Does this mean that summer associates are getting bonuses too?

2. If the answer to question 1 is yes, will be be retroactive to last year?

3. Does this mean summer associate salaries are going up?

4. If the answer to question 3 is yes, will be be retroactive to last year?

5. Does this mean clerkship bonuses are going up?

6. What if I clerked for two different judges, including once as the law clerk to Judge Marilyn Milian and the other as the law clerk to Judge Joe Brown? Do I get 2 clerkship bonuses?

7. Can I avoid the horrible tax implications if I refuse the bonus?

Wonder what King & Spalding will be paying for bonuses this year?

Yo, if you don't wanna pay uncle sam, sen some of yo' money to hoodlams fo' da hood, a nonprofit. You get a tax deduction under da tax code!

1. mean girls or legally blonde?
2. ketchup or catsup?
3. hugges and kisses!

Gootch (6:06), you make an excellent point.

Bravo to these firms for setting the new standard, but let's hope that when the others match (V20? V50?), if they paid bonuses in early 2007 (for work performed in 2006), they hold off on payment until 2008 (though they should still issues memos now for morale and prestige purposes).

some people were meant to be lawyers. getting paid on 1/1 is almost always better than getting paid on 12/31 (very few exceptions that are hard to plan for). why, do you ask? let me explain, my friend. if you get paid on 12/31, you will pay taxes on that bonus 4 months later. if you get paid on 1/1, you will pay taxes on that bonus 16 months later. there's a concept called the time value of money. go google it.

6:20 - That doesn't refute my point, so much as add to it. Let me suggest you direct your sour attitude to the complaint department, located just south of "deez nuts."

Schulte matched!!!

5:41, If associates have to pay 100% of FICA and medicare taxes on bonuses then the answer to my question is yes. The taxes paid on bonuses are higher than those paid on base salary.

Kaye Scholer matched!

Rumor has it that some of the top firms plan to surprise their 2008 associates (i.e. those who just accepted perm offers to return next year) with some sort of bonus in advance of the holidays (I've heard ranges of 1-2 weeks salary).

Anyone else heard this?

6:20 (2): Since taxes are witheld when the bonus is paid, how does THAT work exactly?

Do bonuses get prorated in firms with minimum hr requirements? I'm a first year, and will be 50-70 hours under, does that mean i get nothing?

some people shouldn't even be lawyers. concept: marginal tax rate. this means it is always better to get paid more. go google it. also, stop being a lawyer. better yet, go kill yourself and do society a favor.

why do people type "anon" rather than just leaving it blank?

where's the Kaye Scholer e-mail?

Least Uplifting Headline Ever?

Pit Bulls Kill Miniature Horse Donated to Cancer-Stricken Child

http://www.ksat.com/news/14413827/detail.html

Post-Summer Bonuses to Three-Weeks Salary!!!!!!!!!!

Simpson matched again!

"wthholding" - i'll go google it.

Schulte and Kaye Scholer CANT match. Neither can any hours-based bonus firm give its associates a "special" bonus before all the hours are counted in December. We may get market in February, but today we get the shaft, second-class citizens that we are.

What firms are giving post-summer/2008 associate bonuses?

Any predictions as to how far down the Vault list these special bonuses will go? I say v20 - regardless of whether or not the firm is based in NYC.

6:44, agreed - there's no way that Kirkland, Sidley, Latham, etc. aren't going to match in their NY offices. What they'll do in DC, Chi, LA, etc. is another story...

Summer bonuses?

NEW MEMO!!! SENT TO AMLAW 200 Summer Associates:

We are pleased to announce for U.S.-based summer associates both year-end bonuses and special bonuses for 2007. Bonuses will be paid to summer associates who consumed less than $10,000 worth of lunches between May 14 and August 10, 2007. The special bonuses will be paid November 20 and the year-end bonuses will be paid in December. The bonus amount for 2007 summer associates is $25,000 year end and $5,000 special bonus.

The firm is extremely satisfied with the lackluster work product created by this year's summer associates.

This firm is committed to ensuring the happiness of its summer associates. God knows you'll never be happy again.

Do we get pro-rated bonuses if we consumed over 10k in lunches?

6:28, that's right. It means you get your ass in gear and don't leave the office until you hit it. That's an insane amount to leave on the table for two weekends.

Yes, for every $100 above $10,000, your summer associate bonus is reduced by 1% and you're ineligible for the $5000 special bonus.

Good thing I ate so much this summer so that I don't get bumped into a higher tax bracket and lose a bunch of money.

You don't pay 100% of fica and medicare on the bonus. those taxes are capped at a certain income amount after which you don't pay those taxes at all. once you get this bonus, you'll have passed by that income limit about 8 months prior. however, many liberal candidates want to change this so you have to pay fica taxes on all of your income.

also, my firm doesn't give bonuses to the class of 2007. is that unusual?

6:20(2), you have only a superficial understanding of taxation in the U.S. You don't *pay* taxes in April, you *file* your tax return then. The government requires that you pay as you go. So the difference between 12/31/07 and 1/1/08 is 1 day, and I seriously doubt your overnight rate makes it worth your while to delay your bonus payment by 1 day. I would wager that most people on this site won't change their withholdings just for their bonuses, so the government will likely over-withhold for many, and individuals electing to receive their bonuses on 12/31/07 will receive the refund for the over-withholding after they file their return a few days or months later in early 08. Those electing to receive their bonuses on 1/1/08 won't be able to get the over-withheld amount until the following year (09) when they file the tax return for the prior year (08).

Even if you are able to precisely calculate the correct amount of tax on your bonus, which I highly doubt, you could do that for 12/31/07 and have your bonus in your hands a day earlier to invest (at your amazingly lucrative overnight rate), the earnings on which would be more than what you would have saved by paying your taxes a day later, but having your bonus a day later too.

And don't think you can get away with not paying taxes on your bonus until April of the following year. As I said, the U.S. system is pay-as-you-go, so if you don't allow for the proper amount to be withheld, you will likely be subject to a penalty.

Delaying taxes as long as possible is a good rule, but in this case, you aren't delaying payment - you're delaying your refund. Maybe you shouldn't be a lawyer.

All typos/missssssspellings intended.

6:38 - You sound like a depressed and disatisfied Kaye Scholar associate to me. Am I right, Sam? Consolation is, you're far from the only one! Boo ya!

Summers to bonsai trees!

7:08 Obviously, I would be happy to get those hours. But first years at my firm have little control over the amount of work, and I've had my share of ups and downs. I lost a lot of time in the first few months of work, but I've been working my *** off the last few months, and I'm still short. You're certain everything "gets left on the table?"

Only Social Security (6.2%) is capped. Medicare (1.45%) has no cap. Haven't any of you looked at a recent pay stub?

6:38 or anyone:
At a firm in the Schulte / Kaye Scholer vault range, or really any firms that tie hours to bonuses, do you have any idea how many hours would have qualified associates for the top bonuses? Any guesses if that is likely to stay the same this year? I looked at a couple of the old 2006 bonus posts but didn't see any discussions of the structure of the NYC market bonus hours structure.

531 - it could potentially hurt by eliminating deductions depending on your AMT status.

OMG, if my firm doesn't match I am totally going into i-banking.

bonus season is officially over for the top firms. . .No one is going to provide compensation different from the first releases. . . stop wasting your time and get back to work. we have clients to serve

7:48 if your firm does not match you probably won't get into i-banking...

4:01 - are there AmLaw 200 firms not on te $160 pay scale? WTF? I thought AmLaw 200 defined (albeit, broadly) BigLaw.

And how much of a piece of crap firm do you work at when mid-sizers like Munger Tolles and Allen Matkins are paying $160 to first-years?

7:57, neither Munger nor AM are gonna pay $45k bonuses to first years, though. Check out Infirmation. The Cal-only regional market does not support the same bonus system used by NY biglaw. A first year at Munger or AM will top out at $180k or something, total.

8:00-

I think you are discredited. Although I do not know what Munger's bonuses are, I think Irell tends to match NY bonuses since they ended the profit sharing plan (which exceeded NY bonuses).

8:00--Irell's NALP form says first years had total comp of $180 in 2006, when base salaries were 135. So you would expect at least them to go up to significantly higher than $180 this year, and quite possibly, match NY v10 firms.

How will this affect the Big CA firms -- e.g. Gibson, Latham, OMM?

8:21/8:24: munger (and probably AM) have significantly lower PPP than irell, so even if irell matches, munger very well may not.

It will be interesting to see how this shakes out in non-NY markets. DC, Chicago, LA, etc.

FIRST!

6:44 -

I think PPP and revenue per lawyer are going to be better guides than vault rankings on who will match.

Profits at CWT, Cahill, Willkie, Quinn and Fried Frank are are dramatically higher than profits at higher-ranked firms like Jones Day and Sidley Austin.

this may be a stupid question, but....

what do people think will happen with those who graduated in 2006 and clerked for a year, but have started at their firm now? they will receive a pro-rated year-end bonus, no doubt, but what about the special bonus? the firm memos imply that if you are class of 2006, you get the $10k bonus, but that just doesn't seem possible to me.

K&S announced! For next year. Payable in 2009. No special bonus. Hooray!

There is no way LA firms will match these obscenely large bonii. That's one more reason to lateral to a NYC-based firm for me.

6:28, yep.

6:28, yep. write firm releases, do pro bono hours, whatever you can do.

Ropes will match in all offices, including Boston, D.C. and California.

AMT......what a peculiar concept. When are they rewriting the US tax code again?

205K 205K 205K 205K 205K. I gotta keep saying it to myself for it sink in. And by the way, I'm on track to bill a whopping 1750 hours this year. LOL

205K 205K 205K 205K 205K. I gotta keep saying it to myself for it sink in. And by the way, I'm on track to bill a whopping 1750 hours this year. LOL

4:43 - I've heard of people getting the pro-rated bonus if they return to the firm (i.e., you work, miss the bonus bc you go clerk, return to the firm & get the bonus then), but information is sparse on the topic. My assumption is that most people who go clerk try to work as little as possible in the year or so before they leave the firm, planning not to return, so they wouldn't have made the hours equivalent anyway.

Saw a rumor on greedy clerks that K&E pays pro-rated bonus to departing associates?

Last year, Kaye Scholer paid market bonuses for 2000 hours and an extra $10K for hitting 2400 hours (without finding the memo deep within my email box, I believe it was standard $10K all the way up the chain).

I may finish the year with 1500 hours. I don't care about bonuses.

I need to find a non-hour-based firm.

my understanding of the tax code is perfect. i was an accountant at E&Y for 10 years, clerked at the tax court and now work for the IRS, so shut your mouth beeatch.

where is weil

7:52 -- OMG, like, yes I will. I'm at an excellent firm and litigate complex commercial cases like nobody's business. I-banks will drool.

Anon Me: 1500 hours? I don't know whether to worry for you or be jealous of you.

1500 hours is NOT that rare this year. Or last year. Most big firms have bankruptcy departments, after all.

Don't worry, though. The economy will (eventually) slow, and there will be big bankruptcies again. Then, your friends who got $45k bonuses as first years while working 1500 hours will be working 2500 hours while everyone else sits on their hands and at the end of the year will get an amazing $5k bonus as a thank you because business sucked ass all year, except in bankruptcy.

So it all evens out.

And no, firms generally do not fire you or even care if business is booming and you happened to be slow b/c you're in bankruptcy.

Although, don't smile too big on your 5:15 subway ride. The really good bankruptcy associates get work from lit partners during slowdowns.

Anyone still working? Slackers... You don't deserve your bonus and ... those who claim they are billing over 2400 are clearly billing their dreams about work.

Lets get a list of v20 firms who still have minimum hour requirements.

Lets get a list of v20 firms who still have minimum hour requirements.

Lets get a list of v20 firms who still have minimum hour requirements.

"those who claim they are billing over 2400 are clearly billing their dreams about work."

or they have real responsobilities and real cases in a manhattan firm.

Paul Weiss just matched