As one law firm leader put it, 2008 is a good time to look at current staffing issues, and that has resulted in a few local firms shedding either staff or associates.
Only one firm, Ballard Spahr Andrews & Ingersoll, said it had anything to do with the economy.
Blank Rome saw the departure of nine associates after the firm's annual review period, Ballard Spahr let go of 13 support staff and Reed Smith let go of 50 legal secretaries firmwide.
According to several sources in the legal community, Blank Rome had laid off associates, with at least one source saying 20 associates had been affected.
A Blank Rome spokesman adamantly denied that any layoffs occurred and said there were nine attorneys who were let go after the firm's annual review process as part of the firm's continuous look "at attorney complement and what makes the most sense for the firm and our clients."
He said it was unclear to him when the attorneys were told or how long they would continue to be at the firm but said the review process generally happens in the second quarter. Each of the nine attorneys was provided with outplacement counseling, the spokesman said.
Six of the associates were in Philadelphia, two were in New York and one was in the firm's Washington, D.C., office. The spokesman said three of the associates were litigators, one was in the real estate financial services practice and five were in the corporate practice.
The spokesman said it wouldn't make sense to characterize the departures as layoffs given the firm has hired 18 associates since Jan. 1, 2008, and a total of 73 since Jan. 1, 2007. The firm is continuing on its "aggressive growth" strategy this year in hiring associates, partners and of counsel, he said.
Ballard Spahr Chairman Arthur Makadon confirmed the firm had let go of 13 support staff but couldn't clarify from which offices. He said it affected more than one office.
He said it was a modest layoff and done out of redundancy. Given the current economy, Makadon said 2008 is a good time to look at who is on the payroll. The firm found some overlap and realized that technology made some jobs "expendable," so layoffs followed, he said.
The firm could have undergone this action two years ago, but it wasn't prompted to take a closer look then because the economy was stronger, he said. No other layoffs of staff are expected and no associate layoffs are planned, he said.
Pat Hiltibidal is the chief of office services for Reed Smith. She said the firm had too many secretaries compared to the number of attorneys, and it had been on her to-do list to fix that problem for a few years.
"Our ratios across the firm were not very good," she said.
The firm was hoping that the problem would be corrected through attrition, but that didn't happen and adjustments were needed.
On April 11, 50 legal secretaries were let go firmwide, with 21 coming from the Pittsburgh office, eight in Chicago and four in Philadelphia. The rest of the offices had around five or fewer let go, she said.
The need to correct the ratio became even more apparent with the start up last year of the firm's 24-hour business center, which is part of its overall customer service department. The center, housed in Pittsburgh but for the use of all offices, handles everything from document review to answering client questions and answering the phones after hours.
Although the firm laid off 21 legal secretaries in Pittsburgh, it also hired 18 people to work in the business center, Hiltibidal said.
These latest moves are the second round of layoff-related news to hit the Pennsylvania market since the economy turned at the end of 2007. The Legal reported in early March that Dechert initially laid off 13 associates in its finance and real estate practice only to change its mind the same day and give the attorneys the chance to work in other practice groups.
Nationally some other firms have had to confront the specter of layoffs.
Paul Hastings was the most recent firm to deny layoff rumors. The firm said instead last month that a smaller group of attorneys was let go after performance reviews. A firm spokeswoman told The American Lawyer, a sister publication of The Legal, that the departures were "normal attrition based on performance reviews."
Nationally, the most recent layoff news came from Sonnenschein Nath & Rosenthal, which let go of 37 attorneys, 75 staff members and 12 non-lawyer timekeepers.
Holland & Knight laid off 70 legal secretaries firmwide over what the firm called "redundancies and inefficiencies," according to a report by The Legal's sister publication, the Miami Daily Business Review.
Thelen Reid Brown Raysman & Steiner laid off 26 associates and 85 staff in March. Cadwalader Wickersham & Taft let 35 associates go, 24 Thacher Proffitt mid-levels took buyouts plus an additional five first-years who took optional buyouts, six Clifford Chance associates were laid off and 23 associates at McKee Nelson took buyouts. Several other firms have reportedly laid off staff as well.
Peggy Dixon, a recruiter with Abelson Legal Search, said large firms almost always take in new associate classes regardless of the economy. Sometimes there is an over-hire and sometimes firms get it just right, she said. It's difficult to predict where the economy will be when firms are hiring a year or so in advance, she said.
It is often the mid-level associates who aren't yet bringing in work who are the first to be let go, Dixon said.
Sheldon Bonovitz, chairman emeritus of Duane Morris, said he wouldn't be surprised to hear of more layoffs in this market given the prediction most consultants are making about law firm revenues missing the mark by 10 percent or more this year. He said Duane Morris isn't anticipating any layoffs and is planning on a strong 2008.
Steven Kruza of Kruza Legal Search said firms are definitely examining their bottom lines and that has created a more drawn-out process when it comes to recruiting.
"There's certainly more of a deliberate kind of approach to growth in general right now," he said.
While Kruza is still busy with searches, he said the process has slowed. Part of the slowdown could be seasonal now that summer is fast approaching, he said.
Maura McAnney of McAnney Esposito & Kraybill Associates in Pittsburgh said she hasn't heard of any associate layoffs in the Pittsburgh market.
"Firms are growing very, very slowly and carefully and looking more for lateral partners than they ever have before," she said.
McAnney said firms are still building for the future.
