More Associate Raises. More Client Distress.
The announcement of increases in starting salaries for associates in large California law firms (up to $160,000) led to this law.com headline today: Corporate Clients Take Note as More Firms Announce Associate Raises. The mind just reels, doesn't it?
Here's the quote from the article that really caught my eye:
The rash of raises has some big-firm clients worried.
"There seems to be no end in sight," said James Hall, director of intellectual property at Silicon Valley's Quantum Corp. "At some point I think it has to impact how much I'll pay in legal services ... That money has to come from somewhere."
I don't know Mr. Hall. I don't know his background. But if he has any doubt that every plug nickel of those raises will be recovered from him and thus "impact" how much he pays in legal services, he doesn't have the fist damn clue how big law firms operate. Big law firms are billion dollar businesses or billion-dollar wanna-be businesses. Their first rule of business--PARTNERS DON'T PAY FOR ASSOCIATE SALARY INCREASES. If the money isn't coming from the partners, that only leaves the clients. One way or another, Mr. Hall, you'll be paying.