Akerman Implements Layoffs and Pay Cuts, Anticipating Difficult Second Half
The Am Law 100 firm had a good first half, its new CEO said, but the impact of the coronavirus on the coming months remains unclear.
April 28, 2020 at 04:02 PM
2 minute read
The original version of this story was published on Daily Business Review
Akerman is "resizing" its workforce and cutting pay for attorneys and staff in preparation for months of continuing uncertainty brought by the coronavirus pandemic.
According to the firm, draws will be reduced by 12.5% on an annualized basis for most partners, of counsel and consultants, while some partners "with a different compensation arrangement" will see a 17.5% reduction in their draw on an annualized basis.
Additionally, associate compensation will be reduced by 7.5%, staff with annual salaries of $150,000 or more will see a 7.5% pay reduction, and staff who make less than $150,000 annually will see a 5% reduction. All of those cuts are on an annualized basis, as well.
In a statement about the cost reductions, CEO and chairman Scott A. Meyers said the firm had a strong financial performance in the first half of its 2020 fiscal year, which began Nov. 1.
"But we recognize the second half of our fiscal year is subject to business uncertainties facing the legal industry as a result of the pandemic. We made the proactive decision to confront these uncertainties and control costs by reducing compensation payments across all levels of the firm and resizing our workforce," Meyers said.
A spokesperson for the firm said in an email that the workforce reduction affected less than 5% of the firm's employees.
"None of this is taken lightly. But we believe these measures will ensure the long-term strength and stability of our firm," Meyers added in his statement.
Akerman turned in a strong performance in fiscal 2019, reporting gross revenue growth of 7.7%, to $436.1 million, as profits per equity partner increased by 3% to $695,000. With that jump in revenue, the firm moved up six places on the Am Law 100, to No. 88.
The firm has steadily grown both head count and gross revenue over the past several years.
Meyers took over as chairman and CEO in February, making him the first non-Floridian to hold that title at Akerman.
Dylan Jackson contributed to this report.
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