SUTHERLAND ASBILL & BRENNAN LLP -- ASSOCIATE PAY RAISE MEMO
C O N F I D E N T I A L
MEMORANDUM August 17, 2007
CC: Partners & Counsel
FROM: The Executive Committee
RE: Associate Compensation
Our primary goal as a firm is to provide our clients with the highest
quality work and best service possible on a consistent basis. To do that
we must hire, retain and develop the best lawyers we can at all levels
of experience. We have always believed that there is a great deal more
to hiring and retaining our top talent than compensation: interesting
work, a collegial environment, early client responsibility and extensive
professional development are all aspects of our firm culture that we
value greatly, and we strive to attract lawyers who share those values.
At the same time, we are very aware of our markets and we periodically
review our lawyer compensation to ensure that we remain competitive.
Our latest review has led us to change our compensation structure and to
increase our compensation schedules. We are pleased to announce that
effective September 1, 2007, starting salaries for first and second year
associates in Houston and Washington will be increased to $160,000 and
$170,000, respectively. Effective January 1, 2008, starting salaries for
first and second year associates in Atlanta will be increased to
$145,000 and $150,000, respectively. We will continue to review the
market in New York and will adjust our schedule there as appropriate.
The charts below reflect the new first and second year salaries for the
Washington, Houston and Atlanta offices, as well as total standard
salaries (not including bonuses as discussed below) for third through
sixth year associates with 1950 billable hours (including all time spent
on matters for paying clients and all time spent working for our pro
bono clients) and 2400 total hours (including investment hours spent on
training, client and business development, community service, recruiting
and other firm related work). For associates in their third year and
beyond, a portion of the increased salary will be deferred. The deferred
portion of the total standard salary shown in the charts will be earned
upon working 1950 billable hours and contributing 2400 total hours in a
calendar year. Associates who bill more than 1800 hours, but less than
1950 hours, and contribute 2400 total hours during the calendar year
will be paid a portion of the deferred salary amount. This
compensation structure will be implemented effective September 1st in
Houston and Washington, with a pro rata portion of the deferred amount
payable to associates in the relevant classes who meet the hours targets
for the calendar year.
Houston (Effective 9/1/07)
Class New Total Salary ($) Base Portion ($) Deferred Portion ($)
1 160,000 160,000 --
2 170,000 170,000 --
3 185,000 170,000 15,000
4 210,000 175,000 35,000
5 230,000 180,000 50,000
6 250,000 185,000 65,000
Washington (Effective 9/1/07)
Class New Total Salary ($) Base Portion ($) Deferred Portion ($)
1 160,000 160,000 --
2 170,000 170,000 --
3 185,000 177,500 7,500
4 210,000 192,500 17,500
5 230,000 212,500 17,500
6 250,000 227,500 22,500
Atlanta (Effective 1/1/08)
Class New Total Salary ($) Base Portion ($) Deferred Portion ($)
1 145,000 145,000 --
2 150,000 150,000 --
3 165,000 152,500 12,500
4 175,000 157,500 17,500
5 185,000 167,500 17,500
6 200,000 177,500 22,500
Consistent with our past practice, associates will generally be lockstep
in their first two years following law school, but after that their
compensation (both base and deferred portions) may vary from the
schedule to account for performance, work effort and other contributions
above or below the norm. Associates in classes not reflected on the
schedules will continue to be compensated on an individual basis
reflecting their overall contribution to the firm.
For bonuses, we will continue to look at all aspects of a lawyer's
contributions to the firm, taking into account the quality of work,
overall work effort and firm related efforts. Bonuses will be paid when
appropriate in addition to the payment of the earned portion of deferred
salary and will be based upon performance during the review year
(October 1 through September 30). Although we will have a "rebuttable
presumption" that a bonus has been earned by those lawyers who have 1)
worked more than 2100 billable hours (including all billable time for
paying clients and pro bono clients); and 2) contributed more than 2400
total hours to the firm during the review year, we will not award
bonuses based solely upon billable hours. The determination of bonus
eligibility will continue to take into account all aspects of a lawyer's
performance and contributions to the firm during the review year.
We believe this new compensation structure and the revised standards
will enable us to continue our outstanding service to clients and result
in our continued success in 2007 and beyond. If you have any questions
about the compensation structure, please feel free to talk with Mark
Wasserman, Tom Gick, any member of the Executive Committee or your
Practice Group Leader.
Again, thanks to all of you for your many contributions to the firm.
we must hire, retain and develop the best lawyers we can at all levels
of experience. We have always believed that there is a great deal more
to hiring and retaining our top talent than compensation: interesting
work, a collegial environment, early client responsibility and extensive
professional development are all aspects of our firm culture that we
value greatly, and we strive to attract lawyers who share those values.
At the same time, we are very aware of our markets and we periodically
review our lawyer compensation to ensure that we remain competitive.
Our latest review has led us to change our compensation structure and to
increase our compensation schedules. We are pleased to announce that
effective September 1, 2007, starting salaries for first and second year
associates in Houston and Washington will be increased to $160,000 and
$170,000, respectively. Effective January 1, 2008, starting salaries for
first and second year associates in Atlanta will be increased to
$145,000 and $150,000, respectively. We will continue to review the
market in New York and will adjust our schedule there as appropriate.
The charts below reflect the new first and second year salaries for the
Washington, Houston and Atlanta offices, as well as total standard
salaries (not including bonuses as discussed below) for third through
sixth year associates with 1950 billable hours (including all time spent
on matters for paying clients and all time spent working for our pro
bono clients) and 2400 total hours (including investment hours spent on
training, client and business development, community service, recruiting
and other firm related work). For associates in their third year and
beyond, a portion of the increased salary will be deferred. The deferred
portion of the total standard salary shown in the charts will be earned
upon working 1950 billable hours and contributing 2400 total hours in a
calendar year. Associates who bill more than 1800 hours, but less than
1950 hours, and contribute 2400 total hours during the calendar year
will be paid a portion of the deferred salary amount. This
compensation structure will be implemented effective September 1st in
Houston and Washington, with a pro rata portion of the deferred amount
payable to associates in the relevant classes who meet the hours targets
for the calendar year.
Houston (Effective 9/1/07)
Class New Total Salary ($) Base Portion ($) Deferred Portion ($)
1 160,000 160,000 --
2 170,000 170,000 --
3 185,000 170,000 15,000
4 210,000 175,000 35,000
5 230,000 180,000 50,000
6 250,000 185,000 65,000
Washington (Effective 9/1/07)
Class New Total Salary ($) Base Portion ($) Deferred Portion ($)
1 160,000 160,000 --
2 170,000 170,000 --
3 185,000 177,500 7,500
4 210,000 192,500 17,500
5 230,000 212,500 17,500
6 250,000 227,500 22,500
Atlanta (Effective 1/1/08)
Class New Total Salary ($) Base Portion ($) Deferred Portion ($)
1 145,000 145,000 --
2 150,000 150,000 --
3 165,000 152,500 12,500
4 175,000 157,500 17,500
5 185,000 167,500 17,500
6 200,000 177,500 22,500
Consistent with our past practice, associates will generally be lockstep
in their first two years following law school, but after that their
compensation (both base and deferred portions) may vary from the
schedule to account for performance, work effort and other contributions
above or below the norm. Associates in classes not reflected on the
schedules will continue to be compensated on an individual basis
reflecting their overall contribution to the firm.
For bonuses, we will continue to look at all aspects of a lawyer's
contributions to the firm, taking into account the quality of work,
overall work effort and firm related efforts. Bonuses will be paid when
appropriate in addition to the payment of the earned portion of deferred
salary and will be based upon performance during the review year
(October 1 through September 30). Although we will have a "rebuttable
presumption" that a bonus has been earned by those lawyers who have 1)
worked more than 2100 billable hours (including all billable time for
paying clients and pro bono clients); and 2) contributed more than 2400
total hours to the firm during the review year, we will not award
bonuses based solely upon billable hours. The determination of bonus
eligibility will continue to take into account all aspects of a lawyer's
performance and contributions to the firm during the review year.
We believe this new compensation structure and the revised standards
will enable us to continue our outstanding service to clients and result
in our continued success in 2007 and beyond. If you have any questions
about the compensation structure, please feel free to talk with Mark
Wasserman, Tom Gick, any member of the Executive Committee or your
Practice Group Leader.
Again, thanks to all of you for your many contributions to the firm.
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