- Law firms
- Baker McKenzie announces annual bonuses ranging from $20,000 to $115,000 based on seniority
- Bonuses more uncertain this year as firms face economic headwinds
(Reuters) - Baker McKenzie confirmed Monday that it will pay associates end-of-year bonuses up to $115,000, becoming the first major law firm to go public with annual bonuses in a leaner year for the legal industry.
The global firm will hand out bonuses based on seniority, with a range starting at $20,000 for the class of 2021 up to $115,000 for its most senior associates, according to a memo to associates dated Friday.
The firm's 2022 scale matches its range last year, according to a copy of Baker McKenzie's 2021 annual bonuses posted on Above The Law. The new scale does not appear to offer additional bonus payouts to associates who billed more than 2,300 hours, nor one-time bonuses that ranged by class year, as the firm did in 2021.
Baker McKenzie was also the first firm to announce annual bonuses in 2020, while Cravath, Swaine & Moore was first to roll them out in 2021.
Large law firms have rushed to increase associate bonuses and salaries in recent years to attract and retain lawyers as demand for legal services surged, particularly in corporate deal work. Firms also did several rounds of one-time "special" payouts last year amid the war for talent, but this year have waited until now to dole out bonuses.
At some large firms, base salaries for associates range from $215,000 to $415,000.
While large firms typically rush to match or one-up their rivals when it comes to bonuses to stay competitive, bonuses are more uncertain this year as firms face economic headwinds, with falling demand and rising expenses.
Firms scrambled to attract and keep lawyers to handle soaring mergers and acquisitions activity in 2021, marking a period of frenzied hiring. As the M&A market cools this year, hiring in some practice areas has slowed, and some firms with overcapacity are looking to push lawyers out.
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