Last week, Baker McKenzie shocked the Biglaw world with its early announcement of year-end bonuses. It may be one of the highest-grossing firms in the country, but it’s not known as a compensation leader, so everyone was shocked by the move. Thus far, the firm’s announcement has been met with resounding silence; not a single other firm has matched. Associates at Baker McKenzie are pissed — and not just because the bonus scale is the same as it’s been for years across most large law firms.
Associates are angry about another set of bonuses that the firm has promised.
As you may recall, when Baker McKenzie first instituted its salary cuts in May due to the coronavirus crisis — 15 percent for all attorneys and business professionals making over $100,000 in the U.S. and 10 percent across the board in Canada — the firm promised it would hand out special bonuses for “exemplary performance” during the pandemic. The firm later conducted a round of layoffs in the U.S. and Canada, driving remaining associates to bill like crazy in fear of losing their jobs as well. When the firm announced its year-end bonuses, it also announced an end to those salary cuts on November 30, and once again reminded associates about those special bonuses. At that time, no mention was made of reimbursing anyone for the wages they lost as a result of the salary cuts they endured for seven months.
As it turns out, those bonuses may not be bonuses at all. Sources have told us that these bonuses may be used as a means to address lost compensation, and not everyone will get them. At this point, it’s worth noting that the vast majority of other firms that cut compensation due to the pandemic have already reinstated and reimbursed, or are working to reimburse, full salaries for all affected employees.
Here’s a memo that associates in the Toronto, Canada, office of Baker McKenzie received regarding their special bonuses, where associates are reportedly “furious”:
Please keep in mind that this plan may be limited to the firm’s Canada office. We’ve reached out to Baker McKenzie for comment on whether the firm intends to reimburse its U.S. associates through similar “special bonuses,” or whether it will do so via other means, like lump-sum payments, and received this statement:
The announced bonuses are our year-end bonuses, paid per our usual schedule in January. We also plan to recognize and additionally reward our top performers whose practices have been impacted by the recession, as well as to others demonstrating exemplary performance in the face of increasing demands on their time this year. We will make those determinations after the end of the year.
We have not yet made a final decision on the details of “special bonuses” to compensate for salary reductions in North America. As stated previously, these would be separate and distinct from annual associate bonuses.
Hmm. We suppose we’ll see what happens, but we remain hopeful the firm will repay associates and offer true special bonuses instead of offering bonuses in name only.
If your firm or organization is slashing salaries or restoring previous cuts, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).
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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.
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