Stoel Rives had a good 2018, making $225,921,000 in gross revenue and ranking 134th on the Am Law 200. But that historical success is no match for COVID-19. Even Biglaw firms with strong financials find themselves worried about cash flow and the coronavirus economic downturn. As such, austerity measures are the order of the day.
The firm, like so many others, is using a combination of cost-cutting measures to weather the COVID-19 storm. Salary cuts and staff furloughs feature prominently in their austerity plans:
• Reducing partner distributions by 20% effective April 1.
• Effective May 1: implementing tiered hourly reductions for staff with corresponding pay reductions: 5% for those earning less than $75,000; 10% for those earning $75,000-$100,000, 15% for those earning $100,000-$150,000 and 20% for those earning over $150,000.
• Also effective May 1: Implementing a 20% pay reduction for associates, staff attorneys, and of counsel attorneys; on an annualized basis, a 20% cut starting in May through the end of the year would equal a 13% reduction.
• Furloughing approximately 10% of staff members, beginning April 17, 2020 for at least 90 days. Furloughs are temporary, and staff can be called back to work if economic conditions improve. Benefits will continue during the furlough period at the same level they exist now.
• Continuing the existing hiring freeze and spending freeze.
• Deferring staff bonuses.
• Eliminating associate bonuses based on hours and implementing discretionary-only bonuses.
• Eliminating firm reimbursement for perks such as parking and public transportation.
• Evaluating administrative budgets for additional spending reductions.
The firm’s full statement is below.
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