Hey, all you cool cats and kittens! How was your weekend? I sure hope it was relaxing and you were able to put a pin in all of the bad news the pandemic has brought to your door. But whether you had a great holiday weekend or if you (understandably) couldn’t put the creeping horror to bed for the weekend, more Biglaw austerity news is sure to ruin your Monday morning vibe.
The latest firm to enact cost-cutting measures is Kilpatrick Townsend & Stockton. The Biglaw firm notched $450,324,000 in 2018 gross revenue, making it 78th in the 2019 Am Law 200 ranking. But as we’ve repeatedly seen during the COVID-19 economic downturn, no amount of previous success can really insulate you from cash flow concerns during the pandemic.
So what, exactly, is going down at Kilpatrik? The firm is cutting partner draws by 10 percent. Associates and other attorneys are seeing a 5 percent pay cut. Hourly staff members are having their hours trimmed by 20 percent. Staff who cannot work remotely have been furloughed.
The firm reportedly had the following to say about the “proactive” cost-cutting measures:
“We have decided to take some proactive steps to adjust our expenses that we feel are prudent under these circumstances,” Kilpatrick said in the statement. “On the financial front, we are a fiscally conservative firm that is well-positioned to work our way through this challenging time.”
Kilpatrick is making the cash-conserving pay reductions after a healthy fiscal performance in 2019 that the 640-lawyer firm said extended through the first quarter of this year. “We had a very strong first quarter and were running at full speed before the pandemic,” it said in the statement.
“We, like most if not all law firms, anticipate that our revenues will decrease as a result of the economic turmoil that the COVID-19 global health crisis is causing. Our goal is to find the best way to build a bridge over the anticipated economic downturn and come out strong on the other side,” the firm’s statement said.
The good news, such as it is, is that the firm has established a hardship fund where employees who need additional assistance during the global pandemic can apply for moneys. A reduced-hours schedule is also available for “anyone having challenges working a full schedule in a remote-working environment.”
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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Kathryn 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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