Wednesday, January 31, 2007

Does size matter?

So someone asked me what I thought about Above the Law’s recent postings that first-year associates in New York big firms are making $160,000 plus $30,000 annual bonuses. When you add in benefits and maybe paying for parking and health insurance and whatever other perks basically you’re making $200,000 a year in your first year out of law school.

Wow. That’s a lot of money (cost of living in New York notwithstanding) but the way I see it, it’s not like the people in these jobs are beating the system. When a firm is paying you $200,000 a year, they’re getting $200,000 a year’s worth of work out of you. It’s not like being an assistant coach in the NBA and working six-hour days but being paid several hundred thousand dollars a year…that’s an easy gig. Just like I have some friends here who have jobs lined up at Miami big firms and are starting at about $120,000, well, those people are going to sweat for every penny they earn.

What I’ve started to wonder about is the breakdown of these salaries as compared with smaller and mid-size firm salaries. (Looks like Above the Law is also wondering how hard these people work with a highly unscientific poll). I honestly have no clue how much the 10 lawyers at my firm make and I don’t know if they’ll make me a job offer so I don’t know if I’ll ever find out. I’m sure that they make less than lawyers do at big firms. Probably a lot less. I’m confident that if I did get an offer, my first-year salary would be far lower than $120,000, but I don’t know if it would be $55,000, $80K or what. (I do know that these lawyers aren’t struggling; one drives a Porsche Cayenne, one partner lives on one of those gated islands off South Beach and has a cabin in Aspen).

So you’d think that they work a lot less hard, right? I’m not so sure about this. At this office, they work from about 9:30 until at least 7-7:30. I guess two or three times a week they take hour or hour-and-a-half lunches, but the days are still long. By no means are these people punching a clock from 9-5. It’s not uncommon for them to have dinner meetings or after work work-related events. And they often take work home on weekends. I also have no idea how many hours they're supposed to bill because no one has ever told me. But generally, it seems like the 1900-2100 is standard when I hear about firms down here that talk about their expectations for billables. I don't know how it works in the real world but based on 50 weeks a year, 2000 billables means you have to bill 40 hours a week. I don't know the Big Firm ratio of hours worked to hours billed, but 2000, while a lot, probably doesn't translate into 70-80 hour weeks; it's probably more like 50-60 hour work weeks. I could be way off base on this; I know I can usually bill about seven hours during the nine hours I'm at work; presumably I would eventually become more efficient at it. (Oh, and here are some other blogs about how many hours associates bill. I think, as with all polls, we have to take this stuff with a grain of salt.)

How does this differ from being at a big firm? Once when I went out to lunch with a bunch of the lawyers they were talking about how they’d hate to work at one of the big firms. For the most part, the stuff they talked about not liking is that with a large organization and so many layers of red tape, they would have much less control over their work and their lives. They also talked about their friends at big firms working long days, but other than one of the young lawyers (two years out of law school) who claims her friend works until 11 p.m. almost every single night – which I think is probably a huge exaggeration – no one could really specify what “long hours” really means and how it differs from the 60- or so hour work weeks they put in at this small firm.

On the one hand, a guy I worked with once over the summer at a government job used to work at one of the mega firms here and he said the majority of the time – about 75 percent of the days – he worked 9-6. He claims this was common at his firm and other big firms. He worked at a Really Big Firm. My sense is that the lawyers at my firm put in almost as many hours as those at big firms and probably get paid significantly less. It seems like they chose the small firm environment because they want more control over their lives – specifically their work. As far as I know, this firm has no committees to decide what you can or can’t do.

I guess it comes down to control, or at least the illusion of having some control over your lives, because I can’t think of any other reason why you’d want to work at a small firm for the same number of hours you’d work at a big firm, but for less salary.


At 10:30 AM, Blogger Princess said...

I think there are big firms and there are Big Firms. It seems like New York Big Law attorneys regularly work 12 to 14 hour days, six or seven days a week, with all-nighters pretty common. Here, working "a lot" is a 60 hour week that a New York big firm lawyer would laugh at. So, like everything in the law, it depends. How helpful, right?

At 9:58 PM, Anonymous Michael Froomkin said...

I can think of other reasons why people would prefer a small firm:

1. You know who you'll be working with & for (not some surprise partner from hell).

2. If it's a boutique, you know what sort of law you'll be doing (not being pulled in to staff something else)

3. And this is the big one: smaller firms tend to have leaner teams, so you get much more responsibility (and learn more) sooner.

4. (sometimes) more client contact due in part to #3.

5. A good small firm has a spirit, feels like a team; a big firm is really big, somewhat faceless, and your future is controlled by people you don't even know.

I'm sure there's lots more reasons.

PS. I think you may be wrong about the hours differential. Big firms in other cities, at least, tend to require more hours than most small firms; the exception is some boutiques formed by breakaways from big firms, which can also demand a lot. But big firms also have armies of paralegals and such, which may free you from some drudgery in some cases.

At 9:55 AM, Anonymous Anonymous said...

Those who can, do. Those who can't, teach.

Thanks for your 2 cents Professor, but you idealistic musings on law firm life at different sized firms doesn't hold much water, as you haven't been in the game for almost, what, 20 years. It is a different animal these days . . . In both large and small firms. Both have their pluses and minuses. And, I'm not sure that being stuck doing the same work ("not being pulled in to staff something else"), or having a limit of personalities ("partner from hell"), and lack of support ("leaner teams"), are all good things.

Keep to the blog and opining about how everyone is doing things the wrong way, while you sip Apple-tinis at your next symposium. And do nothing about it.

Some Guy, if you want to try many different things (you know, before you know what law you like), and increase your marketability to go to clerkships, federal jobs, and state jobs too, BIGLAW opens these doors (including serving on boards of community not-for-profits which leads to all kinds of new avenues to explore).

At 8:19 AM, Blogger Vert said...

geez, someone's (^^^) feathers got ruffled. Don't talk about the holy grail.


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