The Big Law Pay News
Ben Thomson, Big Law contributing editor
The Cravath Scale has become something of the gold standard when it comes to big law pay, but the boutiques are muscling in on the big law pay rates with offers that exceed the Cravath Scale.
Boutique law firms like Hueston Hennigan have adopted an associate compensation structure that matched the Cravath Scale last year and boutiques continue to rival their Big Law colleagues on the pay front.
Hueston Hennigan has paid associates above-market pay, some topping the $200,000 level and some with bonuses too.
Hueston Hennigan, known for its high-stakes litigation practice, has implemented a pay scale that begins at $225,000 for first-year associates, a full $10,000 above the Cravath benchmark.
The firm has experienced significant growth in both revenue and profits in the first half of 2024 and is now offering a one-time bonus to its associates, ranging from $10,000 to $40,000 based on seniority and in addition to the usual, year-end bonuses.
The firm’s managing partner, Brian Hennigan, (pictured) emphasized that this move is not merely about numbers but about attracting and retaining the brightest legal minds in the industry.
“We believe in investing in exceptional talent,” Hennigan stated, underscoring the firm’s commitment to maintaining a competitive edge in the legal market, he told American Lawyer.
Strategic Implications
This compensation strategy is more than just a headline-grabbing tactic but reflects the growing significance of speciality firms and boutiques, particularly in the litigation area.
Litigation leaders like Hueston Hennigan are sending a clear message to potential recruits and competitors alike: they are willing to invest heavily in human capital.
Boutique Attraction
Boutique firms are looking to differentiate themselves from larger, more established competitors.
Boutiques are marketing their specialized expertise as a key differentiator. They offer all or even more of the features many of the large firms provide – flexible hours, mentoring, clear career trajectory and so forth – but they also offer their niche focus and industry knowledge with comprehensive training programs to develop experts in their field so that those working there can become subject matter experts.
Offering tailored financial benefits is one way boutiques can also increase their appeal to lawyers.
The key for them is to emphasize the unique value proposition of working for a boutique firm, including greater flexibility, faster career progression, and a more personalized work experience.
The timing of the Hueston Hennigan announcement is noteworthy, coming at a moment when many firms are grappling with economic uncertainties and considering more conservative approaches to compensation.
Hueston Hennigan’s moves may force other firms to reevaluate their own compensation structures to remain competitive in the talent market.
Industry Reactions
Law firms has been quick to react to this development. While some industry observers applaud the move as a necessary step to attract top-tier talent, others express concern about the potential ripple effects on the broader legal market with the big law pay scale rates.
There are questions about whether this will trigger a new round of salary wars among law firms, particularly at a time when many are focusing on cost management and efficiency.
Already even Cravaths have adopted an equity tier in their partnership structure and firms continue to re-evaluate compensation systems.
