August 2006 Weddings
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
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NER: #$*#$)()(*#)$(*!!!!!!!!!!!!!
Just need to vent for a moment.
FI's firm just released it's bonus schedule. We were pretty confident that we would get what they rec'd last year - definitely not more, but no less either because another large firm released that they would match last year's bonuses minus the special bonus just a couple of days ago, and big firms generally all pay the same.
Unfortunately, FI's firm decided to break with tradition (::insert expletive here::) and CUT bonuses. Drastically. As in 7th year associates at FI's firm will receive less in a bonus this year than FIRST year associates at the firm who announced a couple of days ago. It amounts to a $27,000 pay cut for us from last year.
We are officially screwed. 
Re: NER: #$*#$)()(*#)$(*!!!!!!!!!!!!!
Yuck
I'm sorry.
DH's firm hasn't announced yet, but given they are the only top ten firm that doesn't pay good bonuses, I'm expecting we'll see something similar to last year (which wasn't great at all, despite him being on of the top three bonuses his year). We try to plan our finances around his not getting a bonus, just so that it it truly comes across as a bonus -- not something we're counting on. Although we'd be much further along on with our down payment if they didn't pay sucky bonuses to begin with!!
That must be frustrating. Here's a
That sucks. Large law firms are falling apart, so while it totally blows and while I'm sure this is no real consolation to you at this time, I'd just be grateful he's still employed. I read Above the Law and the WSJ's law blog and every day it seems like dozens more lawyers are laid off. It is depressing.
*If* I pass the bar, I am not looking forward to looking for a permanent job amidst this mess (which I guess is your situation now too). Sucks for us.
My worry is that they are going to freeze salaries. His firm doesn't give raises till October, so DH just got his. But he's been holding out for that 3rd to 4th year jump, and if he doesn't get that next year, he'll go nuts.
Have I mentioned I haven't seen my husband in weeks? He's been working till somewhere between 11pm - 1am every night. I don't think it's worth the money
But yes, hrparker, ESF has a good point -- we shoudl be pleased our DH's have jobs!
You guys are right. We should be grateful that he still has his job. I think that we're both just really worried about the wedding right now. We (foolishly, I'll admit) planned on using a chunk of the bonus to pay for part of the wedding (the rest was going to pay down some of his student loans and to max out his 401K) but with the deep cut, there's no way that we're going to have enough to pay for the wedding, let alone the other stuff. And deposits have already been put down.
I guess some associates there are still holding out hope that other firms will follow Skadden's "unofficial" lead (the firm that unofficially announced higher bonuses) and force FI's firm to match. ::fingers crossed:: that that happens, but it's VERY doubtful.
FWIW, FI (being the math geek that he is) did the math today and discovered that if each of the partners gave up the equivalent of 3 weeks worth of pay, that all of the associates could maintain last year's bonus levels. He's now waiting to see what the PPP are this year to decide whether or not to secretly glower at the partners he passes in the hallways.
I'm not trying to flame you, but I have to say that no, you're not screwed. Yes, it sucks, and I'm sorry that he's not getting what you were counting on. But if he's at a job where a cut - not even complete elimination - of a bonus amounts to a $27,000 pay cut, then I presume he makes a pretty penny in salary.
I know it sucks that you're probably going to have to scale some things back, but try to keep some perspective.
I don't often say this, but, and all lovingly, and I know it's not fun to lose a bonus, but, pull your head out of the sand woman and be thankful your FI actually has a decent paying gig in big law at the moment.
***
Law Firms Feel Strain of Layoffs and Cutbacks
You know things are bad when even lawyers are getting laid off.
In downturns of years past, law firms exploited corporate failures and bitter, protracted lawsuits to keep busy and keep billing. But in this still-unfolding crisis, the embittered and the bankrupt have been relatively slow to appear, at least in court.
Law firms in turn are feeling the strain. Thelen and Heller Ehrman, two firms whose deep San Francisco roots extend back decades, have collapsed outright, in part because of the business slowdown. Each firm left several hundred lawyers out in the cold. Many others, including Sonnenschein Nath & Rosenthal and Katten Muchin Rosenman, two Chicago firms ranked among the nation?s hundred most profitable by American Lawyer magazine, and the international giant Clifford Chance have jettisoned dozens of associates.
Still others, like Powell Goldstein, a firm based in Atlanta with more than 200 lawyers, are merging with larger rivals in deals that may be bids for stability. Over all, the Bureau of Labor Statistics reported on Friday that the legal services industry lost more than 1,000 jobs in October.
This is not how it is supposed to work; businesses are supposed to need lawyers in good times and bad alike.
A few big companies are in dire straits or well beyond, including the collapsed Lehman Brothers and Circuit City, and the number of corporate bankruptcies is beginning to rise, according to the American Bankruptcy Institute. The group reported there were 18,456 bankruptcies in the first half of this year, compared with 12,985 during the same period of last year. But because the financial crisis damaged Wall Street first, corporate collapses in many other sectors ? automobiles, airlines and the like ? have not happened, at least not yet.
A wave of big company litigation ? those suits that pit armies of associates against each other ? has also not materialized. A recent survey by one big firm, Fulbright & Jaworski, found fewer large companies reporting new lawsuits against them this year. Although executives may desperately want to sue one another over recent losses, they may not know how big those losses are or want to know how big they are. In any event, cash is precious in this downturn, and litigation is both costly and risky.
?You have to wait and see if you have any damages and, if so, what they are,? said Ward Bower, a principal at Altman Weil, a consultant in Newtown Square, Pa., to law firms. ?That tends to cause a lag.?
The number of lawyers affected at big firms is tiny when measured against the thousands of jobs disappearing at brokerage firms and banks. But in the rarefied world of corporate law, layoffs are unusual. It is striking to have just 20 associates sent packing ? as a spokesman confirmed had happened at Clifford Chance, which has 3,900 lawyers worldwide.
Lawyers at firms that have taken such drastic steps say that the problem is simply that they have too many people with the wrong kinds of expertise at the wrong time.
Sonnenschein, for example, cut about 24 of its 700 lawyers last month, mostly people who worked on real estate deals or related transactions, said Linda Butler, a spokeswoman for the firm. The layoffs were the second round for Sonnenschein, which cut more than 30 earlier in the year.
McKee Nelson, a New York firm, announced last week that it had shaved 17 corporate and finance associates, reducing its complement of lawyers to 174. In a statement, the firm cited the ?devastation that befell the credit markets.? Bell Boyd & Lloyd, a Chicago-based firm with about 260 lawyers, cut loose 10 associates, also blaming ?unprecedented market conditions.?
Beyond the current crisis, corporate clients are trying to rein in spending on law firms. Now that firms are increasingly desperate for business, some corporate general counsels say, the firms are more willing to accept less profitable payment arrangements that do not reward the firms for simply assigning more lawyers to spend more time on a project.
A survey of about 600 corporate executives by Acritas, a London-based research firm, found that 32 percent expected billing practices to change over the next two years.
?Rather than having hourly rates, we are increasingly negotiating flat fees or fixed fees, or success fees,? which include a premium based on predetermined conditions, said Ivan K. Fong, chief legal officer and secretary at Cardinal Health in Dublin, Ohio, and chairman of the Association of Corporate Counsel. Some law firms have resisted those changes, he continued, but may find they have to accept clients? wishes.
?It?s a pretty significant change,? Mr. Fong said, and it is occurring as companies use internal lawyers for more work, to control costs and take advantage of the broader expertise of their own legal staffs.
Lawyer departures, whether voluntary or through layoffs, pose special risks to firms. Layoffs scare off law school recruits, who crave security and wealth.
?Students are also very much aware that ?if they did that last year, it can happen to us again,? ? said Mark Weber, assistant dean for career services at Harvard Law School. He said that this year, offers of employment are harder to come by and firms are hiring fewer interns for next summer.
Lawyers? voluntary departures create the perception that a firm?s condition is deteriorating. If enough lawyers leave, perception becomes reality.
Thelen, founded in San Francisco in 1924, suffered several defections over the past year. Those departures, combined with the credit squeeze, led the partners to decide to dissolve last month, said Douglas E. Davidson, managing partner of the New York office.
?Our commercial litigation practice did not get as active as it might have in the past when the economy slowed,? so there was not enough other work to offset the decline in corporate business, Mr. Davidson said. ?The depth of the economic downturn here is, of course, something that we haven?t seen for maybe 60 years, and so we were more seriously impacted.?
While there are plenty of lawsuits filed by investors against companies, an anticipated explosion of litigation by corporations against one another has been held up just like any other corporate spending, said Stephen P. Younger, a partner at Patterson Belknap Webb & Tyler in New York.
?Clients often don?t want to invest in discretionary litigation in a downturn,? Mr. Younger said. Responding to government investigations has been keeping lawyers busy but does not generate continuing work for armies of associates, like a big lawsuit does, he said. ?There are tons of government investigations going on now.?
The slowdown also has made it much harder for lawyers looking for work to find positions, said Robin S. Miller, a principal at Corrao, Miller, Rush & Wiesenthal Legal Search Consultants in New York.
?It?s a bad market,? Ms. Miller said. While the litigation departments at some firms are busier, activity is less widespread than anticipated, she said. As for bankruptcies, she said that most of the activity is concentrated in financial services, so it is not providing work for lawyers who serve other industries.
?The last time we saw anything like this, this bad, was in the early ?90s,? Ms. Miller said. ?But it?s starting to feel even worse.?On one hand, I totally get the 'at least he's still employed' bit, but $27k is a lot of freakin' money, particularly with a big one-time life event coming up. Even if parker and her FI were the type to truly treat the bonus like a bonus and not expect it (which they may be), this would be the one year where they'd plan for it.
I mean, I've budgeted my (much smaller) bonuses already to help pay for school. Normally I would use the holiday bonus to pay for Christmas presents and my merit bonus would just be a treat or go into savings (or toward taxes, if I owed). But for three semesters, those are big chunks that I can use to put toward tuition.
And think - some jobs pay $27k/year. If there was a couple (like my parents), where the spouse with the lower paying job made that amount and s/he lost his/her job, that would suck, right? Even if the other partner was keeping his/her higher paying job. Only, in that situation, the unemployed person wouldn't have to work/is available to make money elsewhere if there are opportunities. Parker's FI still has to do the same amount of work, if not more, but is taking a last minute unexpected paycut. I realize prices everywhere have gotten too inflated and everything needs to be cut down, particularly bonuses and salaries. But that doesn't mean this still isn't a blow and it still doesn't suck.
It is a blow, it was unexpected, and it's totally sucky. And just because other people have it worse, doesn't mean it's not still bad.
Drink up, my attorney friends. It's time to go into restructuring.
Oh goodness, nobody said it wasn't sucky or bad. We just said that she's not "screwed." If he's working at BigLaw and losing $27k in bonus, he's still making a hefty 6 figures. So it sucks, yes, of course it sucks, and I wish parker luck in finding a job (because I clearly remember how grueling and depressing and horrible that is) and in altering her plans to make do without the bonus. But she's not screwed.
Well, not screwed as far as not being able to pay the heating bill type of screwed, but screwed in terms of fulfilling all the contracts they had agreed to with wedding vendors, contracts they probably agreed to months ago.
I'm sorry - I didn't mean to sound preachy in my last sentence there. My point is - there's all sorts of sh*t going around of various levels, and it's still all sh*t.
Sorry, parker, but I have to agree with bridey. I'm sure it really REALLY sucks, but you really should be thankful he even has a job. I can't even imagine a cut in a bonus being equal to a $27k pay cut - that's what legal aid attorneys here gross in a year.
this is one of the money debates DH and I used to have back in the day. He used to always count/plan on his bonus. he had good reason to: it was always consistant in the past. I said that relying on a bonus is a bad decision. he finally came around and agreed with me. We see his bonus as that: a bonus. We don't use it for budgeting at all. He's really glad this year I made him change his view on that. His bonus is much much lower as well.
I think some are making a little too much of her use of the word 'screwed'. Yes, he still has a job. Yes, he probably makes a pretty penny. But,...he went to school to get this job, probably took out a hefty loan and is now getting married. I know that she was not trying to make any insinuation that she is not thankful or is empathetic towards people who have lost their jobs. When it happens to you, it does suck and when you planned to use that money to pay for a big, once in a lifetime event and even pay down big debt...it can screw you. Whether he should count on a bonus or not is irrelevant..he did and now they may have some financial hardships because of it.
HR-I am sorry. Maybe you can renegotiate packages w/ vendors? Downgrade the bar, etc so as to save money, but not lose your deposit. I hope they do change their mind.
I will say, one thing non- lawyers / non-lawyer-spouses need to keep in mind is the insane toll this takes on your daily life, your marriage, your health, your social life... Yes, it is a choice. But part of that choice includes the expectation of a significant bonus as part of your compensation. Working all year, at ridiculous hours, never seeing your wife or kids, never having time to yourself -- sometimes the only thing that keeps you going is the thought of that $27,000 bonus. So it is devastating -- not only financially, but emotionally -- if that doesn't come through for some reason.
Thanks all for your comments.
I just wanted to throw out there that I do know that things could be a lot worse. And we're incredibly grateful that FI still has his job - Fried Frank actually just did some "covert" lay-offs today, so trust me, we're grateful.
And I know that FI makes a decent salary, but I think it might be easier to put into perspective when you realize that our annual rent is $36k. We're looking to renegotiate or lease or move to Brooklyn when it's up, but we're stuck with it for the next 6 months. We also have approx. $250k worth of student loan debt that we're trying to pay off. And we're trying to plan for the wedding that happening in four months.
Was it stupid of us to plan on the bonus? Oh god, yes. And Irish, we'll definitely be following your lead in the future. But that doesn't take the sting out of it right now.
FI is taking it especially hard, because he IS the one working those long hours that Soprano mentioned. Most weeks, he's at the office 80+ hours; sometimes it's more. And Soprano is right that the thought of getting a decent bonus at the end of the year is really what was keeping him sane. Fwiw's, the "bonus" isn't really considered a "bonus" by most of the associates any more. It's really just part of the compensation package. Part of a firm's value anymore is whether or not it is willing to guarantee bonuses. FI is feeling really stupid right now for accepting an offer here in NYC instead of in Chicago with the big bonus firm. He's really bummed, actually. And feeling like the partners at his firm aren't valuing the work that he's done all year.
Anyway, I just wanted to say thanks for putting things in perspective, and thanks for listening to me vent. We're by no means going to be destitute because of this, but it's definitely got us scrambling for cash to cover those wedding contracts (and yes, Tef, I've spent today talking to vendors to see if we can downsize anything - it's not much, but it'll help some).
Thanks again, all.
That is good news about the vendors. I am glad it will help.
I think what soprano was saying is what many people take to mean "well I work hard also" or "others that are not rich/etc also work hard"---of course they do, noone is saying that, but it does not take away from the fact that I work hard for my money and it has no bearing on my thoughts on how hard others work.
Like I said, I just see it differently. Dh works those hours and won't get much of a bonus this year. But we expected it because of the economic times. Bonus are not only tied to individual's performances, but also company performance. I don't view them as "if you work hard, you will get your bonus because you deserve it."
I'm not AT ALL saying that parker shouldn't be upset or frustrated. I completely understand venting. I just think the view that "I work a lot of hours so I deserve it" is one that is too common in our society. Its more complicated than that (obviously)