BY KELLY BROWN
Last semester, rumors and speculation flew at Harvard Law after several major law firms hinted at potential increases in standard base salaries for first-year associates. The first-year salaries at top firms had held steady at $125,000 for the past five years, and a report issued by the National Association for Law Placement last August called entry-level salaries “remarkably stable.”
That stability is about to change. At premier law firms across the country, partners have announced increases to $135,000 and $145,000. Kirkland & Ellis, Covington, Morrison & Foerster, Hogan & Hartson, Paul Hastings, Sidley Austin, and Latham & Watkins are among the firms making the jump to $135,000.
“I didn’t know there was a recent salary increase,” said 3L Jasi Kamody, who will head to Akin Gump in Washington, D.C., after graduation. “I thought [the starting salary] was still $125,000?”
In fact, Akin Gump has raised entry-level salaries in D.C. to $135,000, and in New York City to $145,000. Other firms that have raised their base pay to $145,000 include Davis Polk, Simpson Thacher, Paul Weiss, and the NY offices of Kirkland, Covington, Paul Hastings, and Latham.
Although NALP had predicted that an enhancement in the pay structure of mid- and upper-level associates was more likely than an increase in first-year salary, New York Lawyer reported last summer that partners, consultants and recruiters said that New York and California would likely increase entry-level pay this year or next.
“I’m certainly excited about the prospect of a salary increase by the time I start working this fall. It has been over five years since the last increase at most firms, so I think the time is definitely ripe,” said 3L Michael Weiss. “On the other hand, given how high the pay already is, it feels awful greedy to be clamoring for more.”
Skadden, which has paid first-years $140,000 since 2000, set the industry standard, and other large firms have finally matched it. Whether Skadden will now increase its base pay to again lead the pack, perhaps to $160,000, remains to be seen.
The raises will also affect compensation for summer associates, which has put smiles on some 2L faces.
But not everyone will benefit. “[The increase] doesn’t matter for me in any case because I have a [financial aid] grant and Harvard is taking all my money,” said Jane Shvets, who will split her summer between Cleary Gottlieb in NY and the State Department in D.C. “I’m mad about that. It’s a completely wrong policy, because it gives poor people incentives to go into public interest, and rich people incentives to go to firms.”
Although “biglaw” firms have increased compensation, the median salary for first-year associates at firms nationwide is still around $100,000. This may come as a surprise to many Harvard Law students, who confine their job searches to only the biggest and most prestigious firms, all of which pay top dollar. And pay for public interest work does not nearly approach the earnings of private sector attorneys. NALP’s 2004 Associate Salary Survey indicates that the median salary for a fifth-year associate ranges from $82,000 to $155,000, which is two to three times what an attorney with similar experience makes at a public interest organization.
To some, the difference in pay is not a deterrent to pursuing a career in the public sector. There are a number of students who opted not to participate in on-campus interviews, and several more who participated in OCI only to interview with small, private public interest firms or government employers. “I’m headed to a small, private public interest firm in North Carolina for the summer,” said 2L Sarah Bolling. “I didn’t interview with any big law firms, and I don’t regret it.”
An even greater number of HLS students admit that public interest might be more personally fulfilling, but that a firm salary was attractive after years as a student on a shoestring budget. On what will they spend the extra cash? “The former salary would have allowed me to make extravagant purchases, like a gazelle-skin wallet,” said 3L Justin Shanes. “Now I can afford to have gazelle-skin bed sheets and maybe even matching pajamas.”