Ben Thomson, BigLaw editor
The great Perkins Coie & Hogan Lovells backdown on the bonus front has seen Big Law play chicken with their talent pool and boy, did it ever backfire.
In a world where associates are the lifeblood pumping through the veins of legal powerhouses, the annual bonus season is somewhat akin to a high-stakes poker game and when Perkins Coie and Hogan Lovells thought they could buck the trend and skimp on the special bonuses that have become de rigueur in the industry. Big mistake.
The firms initially decided to forgo the special bonuses that ranged from $6,000 to $25,000, depending on seniority. It’s as if they forgot that in the age of instant communication and Above the Law’s lightning-fast reporting, news of their penny-pinching ways could only spread far and wide.
The backlash was swift and merciless. Associates, those sleep-deprived, caffeine-fueled workhorses, were not about to take this lying down.
In a move that surprised absolutely no one except perhaps the out-of-touch partners who made the initial decision, both firms executed a 180 faster than a first-year associate spotting a typo in a filing deadline. They caved, matching the market and sheepishly handing out the special bonuses.
But the damage was done. As Jeffrey Lowe, a recruiter who’s seen more legal drama than a season of “Suits,” pointed out, “The market can be a very cruel place.”
And cruel it is. Associates may have the memory span of a goldfish when it comes to case law, but when it comes to their wallets? Elephants have nothing on these lawyer.
The bonus bungle of 2024 isn’t just about the money – it’s about respect, recognition, and the unspoken contract between firms and their associates. It’s about understanding that in a market where top talent can hop from one firm to another very quicly.
Other firms, like Milbank and Cravath, set the tone early, doling out both year-end and special bonuses with the casual air of a banker. They recognized that in a year where revenues were up by a 14.6 percent, sharing the wealth wasn’t just generous – it was smart business.
Meanwhile, some firms got creative. Fish & Richardson and Katten dangled the carrot of special bonuses in front of their associates, but with a catch – hit 2,000 hours first.
As the dust settles on Bonus-gate 2024, one thing is clear: in the high-stakes game of legal talent retention, firms need to put their money where their mouths are. Because while associates may forgive, their resumes – and recruiters’ inboxes – never forget.
In the end, it’s not just about the benjamins. It’s about the message sent to the troops in the trenches. And for Perkins Coie and Hogan Lovells, that message initially read loud and clear: “We value our bottom line more than your bottom.”
