Milbank raises associate starting salaries to $200K
(Reuters) - Milbank is raising starting salaries for first-year associates to $200,000, the New York firm confirmed on Thursday, likely kicking off a compensation war with its rivals in an already fierce market for junior legal talent.
That's a $10,000 increase from its previous starting pay. Second- and third-year associates will also receive a $10,000 bump. Salaries for fourth-year associates and above are rising by $15,000, Milbank said - meaning salaries for its senior associates will hit $355,000.
"Our associates have been working harder than ever, and it has been three years since we increased salaries," said the firm's chair, Scott Edelman, in an email. "We thought it made sense to recognize their efforts with a salary increase."
Big Law firms are grappling with how to retain associates and keep them engaged as deal work volume remains high and as stress from the coronavirus pandemic heightens the risk of burnout.
Throwing money around has been a popular solution - in spring, dozens of firms, including Milbank, announced special two-installment bonuses as high as $64,000 for associates who stuck around until later this year.
But the move to increase salaries has a bigger long-term financial impact than a round of bonuses, recruiters and consultants have noted, making firms wary of taking that step.
Milbank has been a first-mover on pay before. In 2018 it raised associate starting salaries to $190,000. Rival firms soon followed and by last year that amount was standard for Big Law associates in the largest U.S. markets, according to National Association for Law Placement data.
The firm is known for its restructuring work, an area that boomed in 2020 as economic shutdowns pushed major retailers and energy companies into bankruptcy.
Its revenues jumped 15.6% year-over-year to $1.235 billion in 2020 and its profits per equity partner spiked 16% to $4.492 million for the same period, according to data from the American Lawyer.
Many Big Law firms reported profit growth in 2020 despite - or because of - the pandemic. Some firm leaders have pointed to extra bonus rounds as a way of sharing that profit with junior attorneys.
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