Pic: U. Chicago
We knew this was coming, but we were surprised by a few things about the Kirkland & Ellis layoffs. According to David Lat, K&E is in the process of laying off 15-25 nonequity partners in the Chicago office. So-called “non-share” partners can actually be fairly junior, compared to most other BigLaw firms. As early as sixth year or thereabouts, K&E associates who are on regular partnership track can be given the title, if not the equity upside or voting rights. Presumably, it makes clients feel important that they’re talking to partners more often, but it’s probably just a sneaky way of upping the billing rates.
All that aside, here’s what we didn’t expect:
- that it would be “partners” of any stripe. Aside from Jenner & Block, which laid off ten partners (again, in Chicago), the layoffs had been limited to counsel, associates and staff;
- that it would be Kirkland, which paid market bonuses (we’re not going to call it half-Skadden on this site, and that’s the last you’ll hear from us on that issue) in December, at which time indications were that times were tough but layoffs were not imminent;
- that it would be Kirkland, which was #12 on the PPP (equity only) list for 2007, at $2.475 million – although the reasonable argument can, of course, be made that the firm has high PPP because it is run efficiently;
- that it would hit both corporate and litigation, as ATL reports; and
- that it would happen so soon. We thought it would take until February 1 for the firms to get in all the year-end receipts and figure out what their outlook was.
On an administrative note, we’ll probably blog the layoffs with entries here and we’ll supplement the spreadsheet every time, but we won’t do new charts until we’ve got at least five data points. The big spreadsheet will be a running total for the foreseeable future, but we’ll also start a separate for calendar 2009 when the time is right.
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{ 4 comments… read them below or add one }
You are correct – K&E makes “partners” around the 6th year (some make it in 7), but it solely titular. From other BIgLaw perspectives, this is somewhat of a joke a 6th year partner is a materially different lawyer than an 8th-10th yr partner (the pace most other law firms use). As a large corporate client, wouldn’t you prefer getting the 9th year partner’s experience at the same billing rate as K&E’s 6th year partner? Three years is a long time in the legal world and most 6th years are not ready to manage the responsibilities of partnership. Clearly, since this “layer” at K&E is first to go, K&E believes the same thing as well – most other firms are protecting their partners and laying off associates, especially the more expensive senior ones. Meanwhile, K&E’s first move is to ding this “partnership” layer, which means it is treating them as de facto senior associates. Now the big question remains – is it easier to find a job as a senior associate from a big firm or as a junior partner from K&E?
You are correct – K&E makes “partners” around the 6th year (some make it in 7), but it solely titular. From other BIgLaw perspectives, this is somewhat of a joke a 6th year partner is a materially different lawyer than an 8th-10th yr partner (the pace most other law firms use). As a large corporate client, wouldn’t you prefer getting the 9th year partner’s experience at the same billing rate as K&E’s 6th year partner? Three years is a long time in the legal world and most 6th years are not ready to manage the responsibilities of partnership. Clearly, since this “layer” at K&E is first to go, K&E believes the same thing as well – most other firms are protecting their partners and laying off associates, especially the more expensive senior ones. Meanwhile, K&E’s first move is to ding this “partnership” layer, which means it is treating them as de facto senior associates. Now the big question remains – is it easier to find a job as a senior associate from a big firm or as a junior partner from K&E?
When moving inhouse, senior associate=associate and junior partner=partner. It’s a subtlety that doesn’t make much of a difference at most law departments (unless the interviewer came from BigLaw). If the resume says partner – junior or otherwise – that’s a huge advantage.
Years 6-9 are when most large law departments have the transition from “nonexecutive” to “executive” in the corporate ranks, which means things like bigger bonus pool, more severance, etc. A 6th yr senior associate probably comes in in the most-senior non-executive rank and makes executive in a year or two, but a 6th year with a partner title probably comes right in at that level.
When moving inhouse, senior associate=associate and junior partner=partner. It’s a subtlety that doesn’t make much of a difference at most law departments (unless the interviewer came from BigLaw). If the resume says partner – junior or otherwise – that’s a huge advantage.
Years 6-9 are when most large law departments have the transition from “nonexecutive” to “executive” in the corporate ranks, which means things like bigger bonus pool, more severance, etc. A 6th yr senior associate probably comes in in the most-senior non-executive rank and makes executive in a year or two, but a 6th year with a partner title probably comes right in at that level.