Crowell & Moring, an Am Law 100 firm known for its major government contracts practice, said Wednesday it will cut pay for lawyers and some professional staff by 5% to 25% in response to the coronavirus pandemic and its impact on the economy.

Philip Inglima, the firm's chair, said equity partners will take a 25% compensation cut, income partners will take a 20% cut, and associates and counsel will take a 15% cut. Staff making more than $100,000—about a third of the firm's staff—also will have their pay reduced 5% to 20%, he said. He said the reductions were temporary and the firm expects to lift them by the end of the year, depending on the impact of the pandemic.

Inglima added that because partners benefit most when times are good, they are "shouldering the main burdens of our response." He said the firm was fortunate that clients had turned to it for help in the crisis, with some proving to be "fairly resistant" to its effects.

"We have avoided any approach that would include layoffs," he said, noting that the firm has also cut back on expenses and planned capital outlays. "Instead, we are focused on trying to ensure that we have reductions in the real-time cost of our talent over the next several months."

Inglima said the firm has been supporting clients working on the coronavirus response, including major industrial clients that are working on ventilators and other medical supplies hospitals need. Many coronavirus patients who are hospitalized have been put on ventilators, raising fears of a shortage of the devices and of the drugs required to keep the critically ill patients using them safe and sedated.

In terms of law firm business, Inglima said, Crowell anticipates that its recovery cases, many of which are done on contingency, will still do well this year. But, he cautioned, it is impossible for any firm to say it was "insulated" from the pandemic's impact, noting, for example, that "our clients' timeliness of payment and ability to continue sending us work through the balance of the year are going to be affected by it."

"We did see some of the impact of the coronavirus pandemic on our clients and on our revenue in March, but fairly modest," he said. "It's much more an expectation of what it will do for the balance of the year."

News of the compensation cuts comes shortly after the firm announced it was expanding in San Francisco with the hire of several partners and other lawyers from Atrium, the legal startup that closed its doors earlier this year. Inglima said the firm already had some visibility into the impact of the pandemic when the hires were made, and said it would continue to make hires "on a very selective basis."

Read More

Pay Cuts, Layoffs, and More: How Law Firms Are Managing the Pandemic