Milbank Boosts Associate Salaries With $190K Starting Pay
“If we didn't do this at some point,” another law firm would have done it first, said Milbank chairman Scott Edelman.
June 04, 2018 at 01:53 PM
4 minute read
Ratcheting up market pressure on associate compensation, Milbank, Tweed, Hadley & McCloy announced Monday that it will increase its associate salaries across the board by $10,000 or $15,000.
Under the changes, effective July 1 this year, associates in their first, second and third years will see an increase of $10,000, meaning starting salaries at Milbank will be $190,000. Associates in their fourth through eighth years will receive $15,000 more, meaning eighth-year compensation will be set at $330,000. Here are the new salaries for all classes:
- 1st year — $190,000
- 2nd year — $200,000
- 3rd year — $220,000
- 4th year — $250,000
- 5th year — $275,000
- 6th year — $295,000
- 7th year — $315,000
- 8th year — $330,000
Summer associate salaries will also increase, pro rata, under the same scale as first-year associates. The firm announced no plans to broadly change counsel compensation, as Milbank sets compensation for counsel lawyers on an individual basis.
The firm announced the raises to its associates on Monday.
In an interview, Milbank chairman Scott Edelman said, “What we're trying to do is set fair, market-leading compensation for our associates. We're not in a race with other firms, but at the same time, we thought this was an appropriate time for an increase, and we want our associates to know how much they're valued.”
He said the firm wanted to recognize associates' contribution to Milbank's success and its ability to handle high-stakes, complex work. “Our people are our greatest assets. We've been working hard, we've been very busy,” he said. “We're committed to offering compensation at the top of the market.”
The 690-lawyer firm's 2017 financial results mark its fifth straight year of solid growth, according to ALM's reporting. Milbank saw its profits per equity partner rise nearly 11 percent last year to $3.46 million, while its gross revenue rose 7.1 percent to $916.54 million. Revenue per lawyer increased 3 percent to $1.33 million.
Cravath, Swaine & Moore last set the industry standard for associate compensation in 2016, boosting starting pay by $20,000 to $180,000. Milbank and many other firms immediately matched.
“Two years have now gone by, and there is cost-of-living increases and inflation,” Edelman said. “We want to signal to the market that we do want the best, and we're willing to pay for the best, and we think after two years, an additional increase is appropriate.”
“We try to lead the market in terms of associate development and training,” Edelman said, noting the firm's Milbank@Harvard training program. “We didn't see the need to wait for somebody else to make an increase that we think is appropriate.”
“If we didn't do this at some point” soon, another firm would, he said.
When asked whether he expected the increases to put a dent in partner profits, Edelman said, “Any time you raise the cost of your expenses, it's going to have an effect on your profits.” He declined to quantify the increase in expenses the firm will absorb, but Milbank has about 500 associates, so firmwide raises would likely translate to an immediate overhead increase in the mid-seven-figure range.
Edelman said the change would not have “a material effect on firm finances,” adding that he didn't expect partner capital contributions to change.
Milbank's move comes as law firms are heavily competing to attract and retain talented associates—a crucial element in building a large firm's profits and the next generation of lawyers. Just last week, Weil, Gotshal & Manges told associates it will shorten the path to partnership by two years in order to retain more talented associates.
Edelman said Milbank's associate pay raises were not influenced by an external event, and the firm had been considering the salary increases for months.
“The market for the best and the brightest,” he said, “is extremely competitive. There are lots of law firms out there, and we're all competing for some really talented people.”
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View All'Further Investment in Power' Will Drive Big Law Business—But What About Clean Energy Projects?
6 minute readMorrison & Foerster Doles Out Year-End and Special Bonuses, Raises Base Compensation for Associates
Eckert Seamans Snags Reed Smith Global Financial Intelligence Director
3 minute readTrending Stories
- 1Senate Judiciary Dems Release Report on Supreme Court Ethics
- 2Senate Confirms Last 2 of Biden's California Judicial Nominees
- 3Morrison & Foerster Doles Out Year-End and Special Bonuses, Raises Base Compensation for Associates
- 4Tom Girardi to Surrender to Federal Authorities on Jan. 7
- 5Husch Blackwell, Foley Among Law Firms Opening Southeast Offices This Year
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250