. . . except when it doesn’t. A friend sent me an article from Bloomberg titled Credit Market Collapse Claims Victims as Lawyers Exit, reporting on dismissals from law firms that service structured finance, private equity, and mergers and acquisition transactions. So far the numbers of dismissals is small but expected to increase. The article quotes a source from Citi Private Bank’s law firm group: “You’ll see firms use this slowdown as an opportunity to raise the performance bar and clean out the bottom 5 percent of their performers.” It is indeed a schizophrenic time for BigLaw associates. One day starting salaries increase to $160,000, the next senior associates are axed because the work isn’t there. And associates aren’t the only ones feeling the pain: “Chicago-based Mayer Brown fired or demoted 45 partners in March that the firm said were underperforming.” No, it isn’t all camel rides.
Follow up 11/28: Law.com reports that, barring a quick turnaround in the credit markets, Thacher Profitt and Wood will lay off 24 non first-year associates in January. The 350-lawyer firm also offered 29 first-years “the option of taking four months severance and leaving the firm.” The article did not report what option faces those first-years who decline the severance. 53 lawyers = 15% of firm professionals.