We Call BS on Stipend Repayment

by lawshucks on February 26, 2010

ATL has followed up on a previous post with a poll about whether deferred associates will be joining their firms when called.  We had also commented separately on a deluded GULC grad’s estimation of his and his peers’ value to the firms that deferred them.34.7% of the 532 respondents say they’d like to stay with the public interest work they’ve been doing during the deferral.

We think that’s great.  What we don’t think is great is this quote from one unidentified partner at a firm that has deferred people:

We would be surprised and disappointed if someone were to take the stipend and not honor their bargain. Further, given the importance of professional references, we would not expect a lawyer who is just starting out to act in a way that calls into question their ethics, their professionalism and their understanding of contractual obligations.

After the jump, we explain why that’s ignorant, puffery, or both.




The key here is that no firm that has deferred people is waiting breathlessly for their return.  To put it in economic terms, supply far outstrips demand.

There are scores of well-qualified lawyers available right now: ’08s who have passed the bar and already been laid off; ’09s whose offers have been rescinded from other firms; and ’10s who will be ready to hit the ground running in six months.  People in any of those classes could step right in as first years.

Most firms haven’t been cutting deferrals short, either.  In more cases, they’re extending them.  We’re hearing that things are picking up, but no one is claiming that there’s too much work to go around at the junior levels.

We continue to believe that firms would be happy to make the contribution to the common good by subsidizing those lawyers’ first years in public interest jobs.

It’s also mere breastbeating to claim some sort of noble higher ground on “honor[ing] their bargain.”  Is that the same bargain that was honored by deferring people?  How about laying off first years?  Or stealth layoffs?

The partner seems to forget that the deferrals are the direct result of the firms’ mistakes in overcommitting in the first place.  It’s not like the deferred associates were asking to be sent off on a Grand Tour.

So we’d suggest he’s just grandstanding.  And much like you don’t want to sue your clients because of the mud that will be flung back, we can’t imagine any sensible firm is going to go and sue or badmouth a deferred associate who genuinely found a calling in public service.

Of course, people who go to other firms, or even just don’t show up are open targets.  We just can’t see a firm actually doing any of that self-righteous blather on the 35% of people who stay with their public-interest jobs.

You, sir, are full of it.

  • The Dude

    Well said. The nerve of that partner to mention "contractual obligations." "At will" employment works both ways, bro–you were able to defer us (and even defer some of us again), and we can quit or never show up if we want.

  • The Dude

    Well said. The nerve of that partner to mention "contractual obligations." "At will" employment works both ways, bro–you were able to defer us (and even defer some of us again), and we can quit or never show up if we want.

  • Realist

    The Dude says

    Well said. The nerve of that partner to mention “contractual obligations.” “At will” employment works both ways, bro–you were able to defer us (and even defer some of us again), and we can quit or never show up if we want.

    Yeah, dude. Defer and PAY you. Guess you forgot that part. You take $60k from any organization that gets you a temporary substitute job with the expectation that you’ll return when they want? Yeah, the right thing to do is go back. Sorry.

  • Realist

    The Dude says

    Well said. The nerve of that partner to mention “contractual obligations.” “At will” employment works both ways, bro–you were able to defer us (and even defer some of us again), and we can quit or never show up if we want.

    Yeah, dude. Defer and PAY you. Guess you forgot that part. You take $60k from any organization that gets you a temporary substitute job with the expectation that you’ll return when they want? Yeah, the right thing to do is go back. Sorry.

  • http://lawshucks.com law shucks

    The deferral stipend is really just the firms buying an option on the right to employ you in the future. If someone opts out for public service, the firms would be happy to let the option lapse and use it as a marketing opportunity to show their support for the cause.

    All we’re saying is that no one is going to complain if someone was deferred and genuinely decides to stay in the public-interest sector. The partner grandstanding about breach of contract is just full of crap.

    Totally different story if someone goes to another firm or doesn’t go into law at all.

  • http://lawshucks.com law shucks

    The deferral stipend is really just the firms buying an option on the right to employ you in the future. If someone opts out for public service, the firms would be happy to let the option lapse and use it as a marketing opportunity to show their support for the cause.

    All we’re saying is that no one is going to complain if someone was deferred and genuinely decides to stay in the public-interest sector. The partner grandstanding about breach of contract is just full of crap.

    Totally different story if someone goes to another firm or doesn’t go into law at all.

  • Confused

    I don't see the problem in going to a different firm as long as you pay the original firm its deferral stipend back. A lot changes in the year you are deferred–maybe you get engaged and need to move to another city, have a kid and big city/law no longer works, have family issues and need to go home, etc. Why would the original firm be upset about that–as long as you pay the money back? I don't get it.

    Now, if you wanted to keep the money and go to a different firm, that's a different story.

    • http://intensedebate.com/people/lawshucks lawshucks

      It used to be that if you switched firms, the new firm would just cut a check to the old firm on your behalf for things like bar stipends.

      Things probably aren't that good any more, so if you do get deferred and skip out you're probably on your own for repayment. Can't see many firms basically paying a signing bonus for a deferred new associate.

  • Confused

    I don't see the problem in going to a different firm as long as you pay the original firm its deferral stipend back. A lot changes in the year you are deferred–maybe you get engaged and need to move to another city, have a kid and big city/law no longer works, have family issues and need to go home, etc. Why would the original firm be upset about that–as long as you pay the money back? I don't get it.

    Now, if you wanted to keep the money and go to a different firm, that's a different story.

    • http://intensedebate.com/people/lawshucks lawshucks

      It used to be that if you switched firms, the new firm would just cut a check to the old firm on your behalf for things like bar stipends.

      Things probably aren't that good any more, so if you do get deferred and skip out you're probably on your own for repayment. Can't see many firms basically paying a signing bonus for a deferred new associate.

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