Big Law Salary Increase

[Pantalaimon]

I worked at 3 firms, 2 national and one regional. Net utilization was usually a worse system. For example, consider the following month:

2 weeks standard work, 60 billables out of 80 worked

2 weeks you're in the field, 120 billables out of 120 worked

Standard utilization: 180 / 160 (standard work hours) or 120%.

Net utilization: 180 / 200 hours worked, or 90%.

Anyways, my point is billable hours are simple and logical. I much prefer them.

Edited June 29, 2022 by Pantalaimon

[C_Terror]

48 minutes ago, Pantalaimon said:

Engineering has utilization targets, which is really just a billables target in a different form. If your target utilization is 80% you need to bill 1664 for the year, because the denominator in utilization is just 40 hours/wk. So your 0% utilization while you're on vacation drags down your annual utilization and produces the exact same phenomenon.

This is interesting, and not my friend's experience at his engineering firm. He has dockets per week, but he's never had to "make up" his utilization rate while going on vacation in his 10 years there. Perhaps it's different for each firm, and maybe for each type of engineering (his is electrical).

Edit: just asked him to clarify. He has 3 weeks of vacation a year, and he's "given" 112.5 hours as vacation (i.e. doesn't have to make up for it). I assume utilization is counted as 100% or these 3 weeks are simply not included in the rate calculation.

Edited June 29, 2022 by C_Terror

[Cool_name]

1 hour ago, C_Terror said:

No, I still don't think you get my point re; Vacation days. I'm not trying to be condescending but I assume you haven't had experience working a professional non law job before, and as an articling student you haven't necessarily taken vacation under a yearly billable target yet. The billable system of big law is simply unique to any other peer non law job. I'm not talking about being on-call, checking emails, working through vacation (even then, my firm is quite good in making sure the junior associates don't have to work through their vacation).

I'm talking about working more hours because you took/will take vacation because you need to meet your billable target. This doesn't exist in consulting, engineering, business executives, whatever other example you listed.  

What about sales - you have annual quotas?

More generally, there are very few professional jobs that don’t have some kind deliverable you are required produce by some deadline. Those deliverables will take a certain amount of hours to accomplish. If you take vacation that is means the hours needed to complete the deliverables are compressed into a shorter period of time. 
 

You have this weird conception of an annual target. The concept that taking vacation results in you having to work an incremental more about per day for the remainder of the year is not unique to law.

[Pantalaimon]

8 minutes ago, C_Terror said:

This is interesting, and not my friend's experience at his engineering firm. He has dockets per week, but he's never had to "make up" his utilization rate while going on vacation in his 10 years there. Perhaps it's different for each firm, and maybe for each type of engineering (his is electrical).

I think it's more of a difference in what the target is set at, not the existence or lack thereof of a target. Assuming you put in a baseline level of performance so project managers aren't avoiding you, engineering has targets that you generally don't need to think about unless you're a real gunner. So yes, your friend could either be tracking net utilization, which is % of hours worked but IMO hurts high performers per my post above, or he just doesn't need to care about it because he'll hit his target anyways.

[C_Terror]

5 minutes ago, Cool_name said:

What about sales - you have annual quotas?

More generally, there are very few professional jobs that don’t have some kind deliverable you are required produce by some deadline. Those deliverables will take a certain amount of hours to accomplish. If you take vacation that is means the hours needed to complete the deliverables are compressed into a shorter period of time. 
 

You have this weird conception of an annual target. The concept that taking vacation results in you having to work an incremental more about per day for the remainder of the year is not unique to law.

The difference is that your "deliverable" is your billable hours in a law firm, where as your deliverables in sales is, well sales. If you're productive in sales and meet your quota, great you can go on vacation and not worry. It doesn't matter if you're productive in law, you still need to hit your billable hours.

I understand I'm in a law forum talking with fellow lawyers, many of which have never worked a non law professional job before, but I'm actually surprised I'm in the minority in thinking that big law vacation is different. The problem isn't the concept of taking vacation = working more; it's that the billable system ensures that you have to work more no matter how productive you are. If you talk with any non law friends in professional jobs (although per Pantalaimon, some engineering jobs are similar) and explain to them the concept of billables hours and its relationship with vacation hours, they'll tell you it's not the same as their job. 

[Pantalaimon]

Your deliverable as a consulting engineer is also billable hours. Regardless of the exact metric, if you're barely billing as an engineer and then take a three week vacation you are not going to have a happy boss. In fact, sometimes if you're too slow you will be encouraged to take an unplanned vacation so at least the firm has your services when things hopefully pick up.

Maybe the difference here is that lawyers, being lawyers, like to write things down. You will do X or Y happens. Other professions just lay people off when they're subjectively unhappy with them.

[QueensDenning]

23 minutes ago, C_Terror said:

The difference is that your "deliverable" is your billable hours in a law firm, where as your deliverables in sales is, well sales. If you're productive in sales and meet your quota, great you can go on vacation and not worry. It doesn't matter if you're productive in law, you still need to hit your billable hours.

I've heard of Partners/senior associates that basically don't do any legal work and focus exclusively on client development/retention (as well as delegating the work they bring in). Is that not a thing? 

[Cool_name]

37 minutes ago, C_Terror said:

The difference is that your "deliverable" is your billable hours in a law firm, where as your deliverables in sales is, well sales. If you're productive in sales and meet your quota, great you can go on vacation and not worry. It doesn't matter if you're productive in law, you still need to hit your billable hours.

I understand I'm in a law forum talking with fellow lawyers, many of which have never worked a non law professional job before, but I'm actually surprised I'm in the minority in thinking that big law vacation is different. The problem isn't the concept of taking vacation = working more; it's that the billable system ensures that you have to work more no matter how productive you are. If you talk with any non law friends in professional jobs (although per Pantalaimon, some engineering jobs are similar) and explain to them the concept of billables hours and its relationship with vacation hours, they'll tell you it's not the same as their job. 

I’m not surprised other people say the say the relationship between billable hours and vacation you are describing is not the same in their job as even lawyers here disagree with the relationship you are describing.

[Damages]

2 hours ago, C_Terror said:

No, I still don't think you get my point re; Vacation days. I'm not trying to be condescending but I assume you haven't had experience working a professional non law job before, and as an articling student you haven't necessarily taken vacation under a yearly billable target yet. The billable system of big law is simply unique to any other peer non law job. I'm not talking about being on-call, checking emails, working through vacation (even then, my firm is quite good in making sure the junior associates don't have to work through their vacation).

I'm talking about working more hours because you took/will take vacation because you need to meet your billable target. This doesn't exist in consulting, engineering, business executives, whatever other example you listed.  

I am actually speaking from my own experience, so your assumption is dead wrong. I will just leave it that to maintain my anonymity.

 

Maybe I am not explaining well. I will give you some concrete examples.

 

Computer programmers making $250k+ in the tech industry -- they get a performance target just like other professions. They have to develop and produce work product (e.g., software or hitting some milestones in the software development) by the deadline. If they can meet that deadline, i.e., their performance target, the company would not care if you take your vacation or go work out in the middle of the day, take 2 hour lunch here and there -- no problem.

Sales executives making $250K+ -- they get a performance target just like other professions. For them, it would be gross sales they have to generate by the deadline. If they can meet that target by the deadline, the company doesn't care if you take your vacation, etc. 

Engineers making $250k+ in the engineering services industry - they get a performance target that they need to meet as well. They have to complete assigned projects by the deadline. If they can meet that, no problem.

 

Now, the problem is that the performance targets that employees making $250K+ get are generally very aggressive to hit. No company is going to pay someone $250K a year for them to just do some average person's work. No, the company will do their best to get their money's worth. High salary comes with high expectation, i.e., high performance target. If theses high earning employees take their vacation and don't meet their target, they are getting penalized for taking the vacation. These employees get fired easily for not hitting their performance target.

 

The Biglaw lawyers' performance target is to bill certain number of hours a year. If you can meet that by the deadline, then you are free to do whatever. If you can't meet that target, then you will be penalized for taking vacation, just like other examples I mentioned above. Actually, in my mind, Biglaw lawyers are in a better situation than those employees because Biglaw lawyers usually don't get fired immediately for not hitting their target - they get more leeway.

 

In summary, Biglaw lawyers are not unique for getting penalized for taking their vacation. Employees making high compensation like Biglaw lawyers generally have very aggressive performance target that requires long hours of work and dedication. If you can meet your performance target, no employer will care if you take a vacation or do whatever. However, if you can't meet your performance target, you are getting penalized for taking your vacation. 

 

Edited June 29, 2022 by Damages
duplication removed

[C_Terror]

22 minutes ago, Damages said:

I am actually speaking from my own experience, so your assumption is dead wrong. I will just leave it that to maintain my anonymity.

 

Maybe I am not explaining well. I will give you some concrete examples.

 

Computer programmers making $250k+ in the tech industry -- they get a performance target just like other professions. They have to develop and produce work product (e.g., software or hitting some milestones in the software development) by the deadline. If they can meet that deadline, i.e., their performance target, the company would not care if you take your vacation or go work out in the middle of the day, take 2 hour lunch here and there -- no problem.

Sales executives making $250K+ -- they get a performance target just like other professions. For them, it would be gross sales they have to generate by the deadline. If they can meet that target by the deadline, the company doesn't care if you take your vacation, etc. 

Engineers making $250k+ in the engineering services industry - they get a performance target that they need to meet as well. They have to complete assigned projects by the deadline. If they can meet that, no problem.

 

Now, the problem is that the performance targets that employees making $250K+ get are generally very aggressive to hit. No company is going to pay someone $250K a year for them to just do some average person's work. No, the company will do their best to get their money's worth. High salary comes with high expectation, i.e., high performance target. If theses high earning employees take their vacation and don't meet their target, they are getting penalized for taking the vacation. These employees get fired easily for not hitting their performance target.

 

The Biglaw lawyers' performance target is to bill certain number of hours a year. If you can meet that by the deadline, then you are free to do whatever. If you can't meet that target, then you will be penalized for taking vacation, just like other examples I mentioned above. Actually, in my mind, Biglaw lawyers are in a better situation than those employees because Biglaw lawyers usually don't get fired immediately for not hitting their target - they get more leeway.

 

In summary, Biglaw lawyers are not unique for getting penalized for taking their vacation. Employees making high compensation like Biglaw lawyers generally have very aggressive performance target that requires long hours of work and dedication. If you can meet your performance target, no employer will care if you take a vacation or do whatever. However, if you can't meet your performance target, you are getting penalized for taking your vacation. 

 

Okay, and in your past professional experience, if you work at a productive pace and meet your target, you can take your vacation and not worry right? In law, no matter how productive you are, you still need to hit the same requisite number of hours. My entire point in the last however many posts has always been that having billable target hours as a performance metric will always impact your vacation time in a way that no other peer non law jobs has (other than engineering apparently). 

Maybe I'm not explaining it clearly; hours are a finite resource, and there's a push and pull between your billable target and your vacation days. It doesn't matter if you're great at your job, or terrible at your job (assuming your work still gets billed out to the client). You're still beholden to your yearly billables target whether or not you're taking vacation. If you're a super star programmer, you can get your work done in 2 hours and then go on vacation for 2 weeks and not worry. If you're a super star lawyer, you can get your work done in 2 hours, and then go on vacation for 2 weeks, but you still need to make up for your 2 weeks of lost hours.  

Either way, this will be my last post on big law vacation hours, and I'll just have to agree to disagree with the majority in this thread.

 

[Damages]

2 hours ago, C_Terror said:

Okay, and in your past professional experience, if you work at a productive pace and meet your target, you can take your vacation and not worry right? In law, no matter how productive you are, you still need to hit the same requisite number of hours. My entire point in the last however many posts has always been that having billable target hours as a performance metric will always impact your vacation time in a way that no other peer non law jobs has (other than engineering apparently). 

Maybe I'm not explaining it clearly; hours are a finite resource, and there's a push and pull between your billable target and your vacation days. It doesn't matter if you're great at your job, or terrible at your job (assuming your work still gets billed out to the client). You're still beholden to your yearly billables target whether or not you're taking vacation. If you're a super star programmer, you can get your work done in 2 hours and then go on vacation for 2 weeks and not worry. If you're a super star lawyer, you can get your work done in 2 hours, and then go on vacation for 2 weeks, but you still need to make up for your 2 weeks of lost hours.  

Either way, this will be my last post on big law vacation hours, and I'll just have to agree to disagree with the majority in this thread.

 

I disagree. Imagine if your billable target was lower, let's say, 1600 hours, 1400 hours or even 1200 hours. The problem is not having billable target hours as a performance metric. It's the quantity. The target billable hours in Biglaw is tough to hit, i.e., the performance target is tough to hit, which is expected to an employee who is getting very high compensation.

Most employee professionals who sell their time to directly generate revenue for their employers have a performance target as a billable target: Engineers, Accountants, Dentists, Optometrists, Consultants etc. So, having billable hours as a performance metric is not unique to lawyers. This should make sense because these service-providing professionals also sell their time to directly generate revenue, just like lawyers, although their conversion rate may be higher than a lawyer, e.g., 1 hour of actual work = ~1 hour bill (but their hourly rate is also generally lower than lawyers).

Edited June 30, 2022 by Damages
more clarifications

[Bob Jones]

On 6/28/2022 at 3:31 PM, C_Terror said:

Assuming you have an 1800 billable target, that's roughly 150 a month in billables which you'd hit assuming you bill 7.5 hours a weekday (nobody's that efficient normally, but let's just assume this is it). You take a week off, that's 37.5 that you're missing now that you have to make up for some where else in the year. You take the full 4 weeks off, that's essentially a full month of billables you have to "make up" for. 

In any other industry where there isn't a "billables" system, you don't have to "Make up" the 150 billable targets elsewhere in the other 11 months (i.e. you're now compelled to take on more files and work more just to hit your 1800). If you take 2 weeks off in IB, assuming you're in between deals and don't have to work, you don't have to give those two weeks back by adding 2 weeks worth of work on top of whatever you're doing. In a sense, you're not actually getting 4 weeks off in a billable system because you're always giving it back to the firm (assuming you're hitting 100% of billables). On top of that (going off tangent), if you have a slow week, say by billing 15 hours, now you have to "make up" those 22.5 hours that you should've billed that week somewhere else. In any other industry, you get to enjoy that week, and move on without the pressure of additional hours. 

There are absolutely lots of professional non front office jobs out there paying 100-150K a year (total comp, which in most cases include a slight bonus of anywhere from 10-20%, stock matching, or defined contribution  pension) to people working 40 hours a week. It's not a fantasy at all. In a majority of corporations, normal back office FP&A finance jobs offer you that at 4 years out (aka 1st year associate because you don't go through law school). System administrators in IT across all major corporations average that. If you have relevant experience after 4-5 years (again, I choose this because this is how long law school + articling is), there are lots of jobs that open up in the 6 figure range. Caveat, this is my personal experience, and my friends in recruiting in downtown Toronto. 

I won't comment on the 6 weeks off + 2 weeks Christmas, because that hasn't been my experience, but that salary @ 40 hours a week (maybe 50-60 hours once or twice during year and semi annual year end) is way more common than you think. 

You don’t have to “make up any of that time.” Perhaps for bonus eligibility, total billables will be considered but plenty of associates still get their billables without hitting that target. And regardless whether you hit your target or not, anyone can be packaged out without cause at any time. Hitting some sort of a target is not a guarantee of job security. 
 

That said, if you are consistently underperforming then be ready to be on the chopping block. 

[easttowest]

I just don’t get the hang up on the vacation/target thing. I understand the logic. But like. Target is what you have to hit for the year (if you want). Don’t divide your time over 52 weeks if you want to take four off. 

I do understand that some firms are shitty when it comes to target and bonuses. But not all are like that, and in some shops you can get very nice bonuses for just being near target.

[Forever Curious]

On 6/20/2022 at 10:56 PM, Ramesses said:

i thought lawson was at 80k and the majority of firms have moved to 70-75k?

I might have missed something, where did you see that? all I have heard is BJs moving to 70, Lawson Lundell going to 75, and the majority staying at 65 

[Ramesses]

5 hours ago, Forever Curious said:

I might have missed something, where did you see that? all I have heard is BJs moving to 70, Lawson Lundell going to 75, and the majority staying at 65 

i heard it from students i know

Edited June 30, 2022 by Ramesses
fact check

[Conge]

19 hours ago, QueensDenning said:

I've heard of Partners/senior associates that basically don't do any legal work and focus exclusively on client development/retention (as well as delegating the work they bring in). Is that not a thing? 

 Depends on compensation structure, but if you're allowed to take some of the billings you originate such that you don't technically need to bill time to make money, and you're bringing in enough business, then it's a thing. But it's rare. 

[Rashabon]

7 minutes ago, Conge said:

 Depends on compensation structure, but if you're allowed to take some of the billings you originate such that you don't technically need to bill time to make money, and you're bringing in enough business, then it's a thing. But it's rare. 

It's not rare on Bay Street. It's the business model, and not with taking the billings you originate. Every firm has its own compensation structure but I would be surprised (and it runs counter to everything I have seen) to suggest that your own hours correlates to your compensation as you move up the ranks.

[Conge]

45 minutes ago, Rashabon said:

It's not rare on Bay Street. It's the business model, and not with taking the billings you originate. Every firm has its own compensation structure but I would be surprised (and it runs counter to everything I have seen) to suggest that your own hours correlates to your compensation as you move up the ranks.

I mean rainmakers are rare in a relative sense. As in the majority of lawyers in a firm, especially at the associate level, are billing time to make money instead of being originators. 

[Rashabon]

24 minutes ago, Conge said:

I mean rainmakers are rare in a relative sense. As in the majority of lawyers in a firm, especially at the associate level, are billing time to make money instead of being originators. 

Yeah but the reply was focused on partners/senior folks. I don't think it applies to senior associates, but certainly at the partner level, it's not all that rare for partners to be focused on origination and client relationship management as opposed to hard billable time. You'll almost never find the higher paid equity partners (and not just the top 3-4 rainmakers) billing as much actual billable time as the associates they work with.

Origination isn't the exclusive route in which partners get compensated for non-billable efforts. Finding a client is great, but keeping a client is just as important and is valued appropriately.

[Conge]

11 minutes ago, Rashabon said:

Yeah but the reply was focused on partners/senior folks. I don't think it applies to senior associates, but certainly at the partner level, it's not all that rare for partners to be focused on origination and client relationship management as opposed to hard billable time. You'll almost never find the higher paid equity partners (and not just the top 3-4 rainmakers) billing as much actual billable time as the associates they work with.

Origination isn't the exclusive route in which partners get compensated for non-billable efforts. Finding a client is great, but keeping a client is just as important and is valued appropriately.

It was in response to a question about "partners/senior associates" that "basically don't do any legal work"; I think it also applies non-equity partners. Few of them are going to be rainmakers in the sense they don't need to bill hours to make money. I would also think it's going to be a relatively small number of equity partners that don't bill any of their own time. 

Anyways, I think the person who asked the question has enough context for their question now. 

[Rashabon]

3 minutes ago, Conge said:

It was in response to a question about "partners/senior associates" that "basically don't do any legal work"; I think it also applies non-equity partners. Few of them are going to be rainmakers in the sense they don't need to bill hours to make money. I would also think it's going to be a relatively small number of equity partners that don't bill any of their own time. 

Anyways, I think the person who asked the question has enough context for their question now. 

Yes that's fair and you're right on that sense. Many will still bill some time, depending on the client in particular and if it's time they know will get paid.

[Bob Jones]

Does anyone know if “mid sized” firms (I.e. Minden Gross, Torkin Manes, Shibley Righton, etc) ended up matching/coming close to the new scale? I believe this may have been previously discussed briefly but I’m not sure where that landed. Thanks!

[Jaggers]

I tried to find it, but there are too many pages in this thread. What's the going rate for a 2019 call on Bay St right now?

[PzabbytheLawyer]

On 7/16/2022 at 12:01 AM, Bob Jones said:

Does anyone know if “mid sized” firms (I.e. Minden Gross, Torkin Manes, Shibley Righton, etc) ended up matching/coming close to the new scale? I believe this may have been previously discussed briefly but I’m not sure where that landed. Thanks!

I know at least one has, which I won't name, through a friend who works there.

[WhoKnows]

14 minutes ago, Jaggers said:

I tried to find it, but there are too many pages in this thread. What's the going rate for a 2019 call on Bay St right now?

Pretty sure 175 base is the number.

Edited July 28, 2022 by WhoKnows