The law firm layoff carnage continued on Thursday, with at least four firms handing out pink slips to attorneys and staffers.
Sidley Austin made the biggest cut of the day, laying off 89 associates and staff attorneys, as well as approximately 140 staffers in its U.S. offices, it confirmed on Thursday. Those cuts are in addition to "routine departures," according to an internal firm memo that was leaked to legal blog Above the Law.
Philadelphia-based Blank Rome confirmed that it cut 27 associate and 52 staff positions.
Two Texas-based law firms -- Baker Botts in Houston and Gardere Wynne Sewell in Dallas -- also felt the layoff pain. Both firms confirmed that they cut jobs, though neither would specify the number of positions eliminated. Above the Law reported that about 30 attorneys were laid off from Baker Botts, and 20 attorneys and 40 staffers were let go at Gardere. In a statement to the blog, Gardere said that the layoff totals in both categories are "substantially less."
The cuts at Sidley Austin were by far the biggest of the day, however. The firm is expecting its work slowdown to continue for 12 to 18 months. "The economy continues to present unprecedented challenges to the firm and its clients," the memo reads. "While the quality and diversification of our practice and our conservative financial management have put the firm in a strong position to deal with these challenges, we are not immune to the current turmoil."
The memo said it would provide the departing workers with financial and job assistance, but didn't specify the length of the severance package it is offering.
The jobs cuts at Blank Rome came after a "comprehensive review of staffing levels," according to a statement issued by the firm.
"This review led us to conclude, regrettably, that further adjustments to our associate and staff complements were necessary," the statement reads. Blank Rome laid off 20 associates and 40 staffers in an earlier round of cuts in January.
In addition to job cuts, Blank Rome is reducing the length of its 2009 summer program from 10 weeks to six weeks, and the associate start date will be moved back to at least January of 2010.
A firm spokeswoman declined to say which offices or practice areas were hit hardest by the layoffs.
Both Baker Botts and Gardere tied their layoffs to the economy.
"Just as our clients are struggling with budget cuts and a reduced demand for their products, so too has the overall demand for our services declined," wrote Baker Botts Managing Partner Walter J. Smith in a memo to the firm that was posted on Above the Law. "This decline began in the fourth quarter of last year, and while certainly not threatening the long-term viability of the firm, is nonetheless significant."
Without offering any specifics, Smith wrote that the slowest practice areas saw the most job cuts.
Gardere also said its job cuts are a response to "the unprecedented levels of economic uncertainty."
While widespread layoffs have become par for the course at large firms mostly on the East and West coasts, Texas firms have largely managed to avoid large job cuts up until now. The cuts that have taken place in Texas have been relatively small.
Dallas-based Winstead laid off 20 staffers from its Dallas office in February, while Dallas-based Haynes and Boone trimmed one associate, one of counsel and one staffer from its New York office earlier this month. Andrews Kurth -- based in Houston -- was reported to have quietly let go about 20 associates several weeks ago, though the firm declined to confirm those layoffs.
Mark Santiago, a legal consultant with Kerma Partners, said that layoffs are heading inland as firms that were initially buffered from the financial crisis start to see business slow down as with their coastal competition. "Most of the slowdown in business that we have seen has been on the coasts. We're going to see it more and more in the Midwest," he said.
Despite the job cuts, Smith wrote that Baker Botts is well positioned to get through the economic downturn because its practices are diversified and its offices are strategically located to serve client needs. Additionally, he said the firm has been conservative with its finances.
Gardere also said it is financially sound and has a number of strong practices including bankruptcy and litigation.
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