Surpassing Milbank, Davis Polk boosts 1st-year associate pay to $202,500
(Reuters) - Davis, Polk & Wardwell has upped the stakes in the brewing associate compensation race, announcing on Friday that it is increasing starting salaries for first-year associates to $202,500.
According to a memo obtained by Reuters, the New York-founded law firm's salary scale goes beyond the parameters that were set by Milbank -- and have been matched by at least four others -- on Thursday. The memo was first reported by Above The Law.
At least two other U.S. law firms -- Chicago-founded Baker McKenzie and Philadelphia-founded Dechert -- have confirmed to Reuters they're going to match Davis Polk's scale.
More law firms are expected to announce increases to their own starting associate salaries soon.
First-year Davis Polk associates are set to make $2,500 more than their Milbank counterparts, according to the scale. From there, Davis Polk associates will make either $5,000 or $10,000 more, depending on their class year.
Starting salaries for senior Davis Polk associates will rise to $365,000, $10,000 more than what Milbank is set to offer.
"As we have said before, it is our foremost priority that you know that we appreciate you and all of your efforts," said Davis Polk chair and managing partner Neil Barr in the memo. "You are uniquely talented and dedicated and should be compensated accordingly."
Although Milbank took the lead in 2018 when its starting salary of $190,000 became the standard, Davis Polk over the past year has also taken on the role of standard setter. When law firms announced associate bonuses last fall and this spring, Davis Polk offered more money that then became the standard.
As of now, Milbank appears to be emerging as the industry standard. The four other law firms confirming to Reuters they would match it on associate salaries are Cadwalader, Wickersham & Taft; McDermott, Will & Emery; Mintz, Levin, Cohn, Ferris, Glovsky and Popeo; and Winston & Strawn.
As one of two law firms that have confirmed they're marching to Davis Polk's tune right now, Baker McKenzie is one of the highest-grossing law firms in the United States and one of the largest in the world.
Baker McKenzie said it saw little change in revenue at the end of its fiscal year 2020, which ended June 30, 2020. In September, the firm laid off lawyers, other timekeepers and staff professionals in North America. Then in November, the firm outlined an associate bonus scale that reached up to $100,000, with the promise to go higher.
"Our associates make important contributions to our clients every day, and we believe it’s important to recognize those contributions, especially in light of the many challenges brought on by the pandemic," Baker McKenzie's North America CEO Colin Murray said in a statement Friday.
Both the associate bonuses and the salary increases come as Big Law firms have been grappling with burnout in their associate ranks. Dechert was one of the few firms that doled out bonuses to professional staff and gave an extra paid day off earlier this year.
Above The Law also reported that Fenwick & West is matching Milbank's scale, while Lowenstein Sandler and Proskauer Rose are matching Davis Polk's scale; Reuters has not received comment from those firms.
Editor's note: This story has been updated to include more confirmed and reported law firm salary announcements.
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