Associates Take A 20 Percent Pay Cut And Some Staff Gets Furloughed At This Am Law 100 Firm

Are you ready for the next bit of COVID austerity news? Yes, these stories are coming fast and furious, but in the rapidly changing environment that’s necessary to get a full picture of what’s really happening out there in Biglaw.

All employees at Venable received an email this afternoon from chairman Stuart Ingis, laying out the “Proactive Financial Measures to Respond to Disruption Caused by the Coronavirus.” The email laid out the steps that the firm is taking to tighten their belts during this tumultuous time. That includes a sliding scale of pay cuts across the firm– those making over $190,000 will see a 20 percent decrease, and those under $60,000 will see 0– as well a furloughing some staff members that primarily support the firm’s physical locations.

Here’re the details:

The firm will:

Reduce Compensation for Lawyers and Staff.  The firm will implement the following salary reductions based on compensation level, with greater reductions associated with higher compensation:

Salary Level Percent Reduction
Above $400,000 20% on all compensation plus 10% of compensation above $400,000
$190,000-$400,000 20%
$120,000-$189,999 15%
$75,000-$119,999 10%
$60,000-$74,999 5%
$59,999 and below No Reduction

For lawyers and exempt professional staff, those staff on a fixed salary, these reductions are effective beginning tomorrow, April 4, and will be reflected in full in the April 17 payroll payment.  For non-exempt professional staff, those staff that are paid on an hourly basis, the reductions are effective beginning one week from tomorrow, April 11, and will be reflected in full in the May 1 payroll payment.  The firm has previously communicated to equity partners actions that affect their compensation in similar ways.

Furlough Certain Professional Staff.  We will furlough certain professional staff, primarily those involved in positions that support facilities and in-person operations when our offices are fully open, until Friday May 29, 2020.  The firm will pay for medical and dental benefits for furloughed individuals during this period and they will be eligible to apply for the expanded unemployment benefits enacted last week by Congress.  We also have prepared materials to assist those that are furloughed and will have staff and lawyers available to help with applying for benefits available during the furlough period.

We will be regularly assessing events and will update these decisions and our firm’s response as appropriate.  Thank you for your understanding and your ongoing commitment to Venable.  We have and will continue to have a great firm.

When reached for comment, the firm had the following statement:

“Venable entered this period of economic and societal disruption caused by COVID-19 with a solid start to the year that continued through the first quarter. The diversity of our practices, the quality of our attorneys and professionals, and our relationships with our clients are very strong.

Because the extent and duration of the disruption and its impact remains uncertain, we have taken steps to tailor staffing needs to the current environment and prudently prepare the firm for the future. Our actions include postponing certain distributions to equity partners, implementing tiered compensation reductions for attorneys and staff, and temporary furloughing certain staff in roles that primarily support office operations.”

Hopefully this will prove the only cost-cutting measures the firm needs to take and everyone really is back at work, as the firm anticipates, by May 29th. Fingers crossed on that one.

If your firm or organization is slashing salaries, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).

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headshotKathryn Rubino is a Senior Editor at Above the Law, and host of The Jabot podcast. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter (@Kathryn1).

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