Earlier this month, we reported that it was only a matter of time before more Biglaw partners would be forced to cut their draws and distributions to stave off the pain caused by the novel coronavirus. In fact, law firm management consultant Patrick McKenna said he’d be surprised if at least 80 percent of the top 200 firms in the country hadn’t made such a move by the middle of April, noting that “a typical reduction is in the range of 30 percent.” We’ve got to give him a lot of credit, because his prediction continues to ring true.
Today, we have news on a firm ranked just outside of the Am Law 100 that’s decided to make a move on partner compensation for the benefit of all its employees.
A confidential source tells us that Lowenstein Sandler is slashing its partner draws to so the firm can safely ride out the COVID-19 financial roller coaster that’s soon to come. Here are the details that we received:
At a video town hall meeting attended by over 500 employees last Friday, Lowenstein Sandler Chair Gary Wingens announced that the firm had a very strong March, yet had substantially reduced distributions to its equity partners in order to preserve liquidity for what it expected to be a bumpy second quarter. While he hoped to not have to make other cuts, Wingens made it clear that they were watching their metrics very carefully over the coming weeks.
When reached for comment by Above the Law, firm management confirmed Wingens’s comments, but did not specify the percentage cuts partners were taking. We hope this move is enough to guide the firm through what’s sure to be a rough time.
If your firm or organization is slashing salaries, closing its doors, or reducing the ranks of its lawyers or staff, whether through open layoffs, stealth layoffs, or voluntary buyouts, please don’t hesitate to let us know. Our vast network of tipsters is part of what makes Above the Law thrive. You can email us or text us (646-820-8477).
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Staci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.