Noticing a shift in the compensation strategies of elite law firms, several leading names from the sector are implementing a range of novel changes to their pay systems. Outfits such as Paul, Weiss, Rifkind, Wharton & Garrison and Cravath, Swaine & Moore have taken significant steps forward in this regard.
Paul, Weiss, Rifkind, Wharton & Garrison have made the move to a closed compensation system while Cravath, Swaine & Moore has jettisoned a pure lockstep model in favour of embracing a non-equity tier. Both these measures display a discernible tilt towards shifting pay systems within these renowned firms.
Incorporation of strategies such as absorbing the non-equity tier, constructing larger bonus pools and the initiation of a “black box” model for individual earnings are now being keenly considered. This evolution in compensation strategies is being seen as an attempt to make these law firms more attractive propositions for laterals.
As the ramifications of these changes are being watched carefully, read more regarding the measures being taken by these firms and the likely impact on legal hiring trends.