Marci Eisenstein of Schiff Hardin. (Courtesy photo)Schiff Hardin Attorneys, Staff Hit With Salary Cuts Up to 50%
Most lawyers and staffers who make more than $100,000 will see their salaries temporarily reduced by 15%, but pay for a small portion of lawyers could be slashed in half.
April 16, 2020 at 12:35 PM
3 minute read
Schiff Hardin on Thursday announced it is cutting salaries for both attorneys and staff, including reductions of up to 50% in compensation that will affect about 6% of the Chicago-based firm's attorneys.
Most of Schiff Hardin's lawyers and staffers who make more than $100,000 will see their salaries temporarily cut by 15%. The firm is also laying off a small number of staff—in 2019, Schiff employed 227 staffers across seven offices, according to ALM data.
In a statement, the firm said that the potential 50% pay cuts for some lawyers would be based on "anticipated demand."
"These are challenging times for our attorneys and staff and we are asking everyone in the firm to make sacrifices and share the burden," Schiff Hardin said in a statement. "We believe this is the right approach for our firm and will allow us to continue to provide quality service to our clients and ensure the strength of the law firm going forward as we weather this health and economic crisis."
The firm said it also canceled its summer program but has extended job offers to its five summer associates. Its also pushing back the start date of its first-year class to January 2021 at least.
The economic effects of the COVID-19 pandemic are hitting Schiff Hardin after the firm saw its overall revenue and head count drop again in 2019 for the fourth year in a row, according to preliminary reporting for The American Lawyer's Am Law 100 rankings.
Schiff Hardin saw its revenue drop by 3.3% in 2019 to $186 million and a 3.2% decline in overall head count, to 233 lawyers. In an interview conducted March 13, managing partner Marci Eisenstein said the firm "feels very good about last year." She pointed to the firm's revenue per lawyer and profits per partner, both of which stayed relatively flat at $800,000 and $1.01 million, respectively, as positive news.
"We feel we're punching above our weight relative to our peer firms," Eisenstein said at the time.
Schiff Hardin's revenue and head count declines occurred when the economy was considered strong. Asked about how the firm might perform in an economic downturn or a recession triggered by the pandemic, Eisenstein indicated she hoped for the best while noting that clients need help.
"I am very hopeful that the social distancing decisions that are being made by our government and business is going to help nip this thing in the bud," Eisenstein said at the time. "I think our clients have profound needs right now. They're looking to firms and lawyers to support them. They're in their kitchens, too, feeling disconnected. … There are real opportunities to distinguish ourselves in supporting our clients through this."
In sending out its statement Thursday, the firm declined to elaborate further.
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Pay Cuts, Layoffs, and More: How Law Firms Are Managing the Pandemic
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