Milbank's year-end bonuses bring pressure on Big Law to match

Big Law’s bonus season arrives with some additional intrigue this year, thanks to early moves by Milbank LLP to hand out extra payments to associates .

The Manhattan-founded firm said that it will pay associates annual bonuses ranging from $15,000 to $115,000, the same scale used by major firms last year. The announcement comes as firms have yet to match the extra $6,000 to $25,000 in special bonuses that Milbank rolled out over the summer.

The stage is now set to see what the rest of the Big Law firms do when it comes to associate bonuses. Will they match Milbank’s year-end bonus scale or will they add in extra cash to make up for special bonuses? Or might they up the total bonus money they shower on associates altogether?

“The special bonuses that happened this summer were a surprise to most,” said Ru Bhatt , a recruiter for Major, Lindsey & Africa in New York. “I expect other firms to match the bonus numbers and for the firms that are competitive with Milbank, they’re likely going to put that special bonus number into the final bonus package,” he said.

If other Big Law firms opt to bundle the special and year-end bonus totals, associates could be taking home an extra $21,000 to $140,000, based on seniority.

Herbert Smith Freehills, Kramer Levin Announce Merger Plans

Herbert Smith Freehills and Kramer Levin Naftalis & Frankel LLP plan to merge creating one of the 20 largest law firms in the world with more than $2 billion in revenue, the firms said in a statement.

The proposed new firm name would be Herbert Smith Freehills Kramer, known in the US as HSF Kramer, according to the statement. The combination will accelerate US growth in sectors including energy, financial services, infrastructure, mining, and technology, the firms’ statement said.

The combined firm would have over 2,700 lawyers, including around 640 partners, across 25 offices globally, according to the firms’ statement. Around 120 of those partners would be based in the US, according to the statement, “surpassing international peers.”

Kramer Levin operates three offices across the US in New York, Silicon Valley and Washington D.C. It has a sole international office, located in Paris, according to its website. The Paris office won't be part of the merger .

Herbert Smith Freehills was founded via the merger of UK firm Herbert Smith and Australian litigation powerhouse Freehills in 2012. It has one US office, in New York.

Latham Loses UK Partners as US Competitors Rush Into London

Latham & Watkins for years has been viewed as arguably the most successful US law firm operating in London. Now, it’s taking its licks .

The firm has lost 11 UK partners to competitors this year, more than double the attrition it averaged the previous four years, according to data from legal recruiter Edwards Gibson . The defections include lawyers who formerly headed the London office and its intellectual property and litigation groups. They’ve come at the hands of other large, profitable US firms, including Sidley Austin, Skadden, Paul Hastings, and Milbank LLP.

“Latham made the right bets and it was very bold,” said Scott Gibson , a director at Edwards Gibson. “Until recently, I would say it almost had a cult-like feeling among people who were there. They loved it. And now, we’re seeing Latham losing partners.”

The exits coincide with two events: a historic surge in London partners switching law firms and a change in Latham’s compensation system.

The shift in London isn’t confined to Latham. Through October, the city saw about 5% more lateral moves this year than it did during a record-setting 2023, according to Edwards Gibson, which has tracked partner hires in the city since 2007. If the pace holds up, there will be about 535 partner moves this year, compared to 510 last year.

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