Under a new structural adjustment that mirrors similar changes implemented by its competitors years prior, Cravath Swaine & Moore has established a nonequity partnership tier to offer greater flexibility in partnership pay. This move comes with expectations that additional law firms will carry out modifications to their partnership structures and compensation methods in the coming years, with a focus on attracting and retaining top-tier talent.
This newly introduced structure allows for the creation of a paid tier for lawyers holding a partner title at Cravath, while another tier is set aside for equity ownership within the law firm. It’s said that the firm has been discussing with counsel-level attorneys about joining this non-equity tier since, at least, last summer, as noted by a leader from an Am Law 50 firm.
For more nuanced details of Cravath’s restructuring and the potential future trend in the larger legal industry, more can be read here.