Alston & Bird has cut associate pay by $5,000 across the board for the remainder of the year. "It is no secret the market is shifting," said the firm's managing partner, Richard R. Hays.
The cuts, effective July 15, will save the firm, which Hays said has 451 associates, about $2.26 million this year. He said Alston's bonus scale has not changed and that the firm has not yet decided on 2010 associate salaries.
Alston reported 2008 revenue of $552.3 million and profit per equity partner of $914,569.
The firm suspended raises for associates in January, keeping them at their 2008 pay grades. The firm's Atlanta pay scale ranges from $145,000 for first-years to about $190,000 for seventh-years.
That scale was instituted at the beginning of 2008, when Alston, like its Atlanta peers, raised associate pay for the third time in two years. Big firm starting pay jumped from $100,000 at the beginning of 2005 to $145,000 by Jan. 1, 2008.
Alston's pay cuts reduce annual starting pay by about 7 percent, slightly less than the 10 percent across-the-board cuts that many firms are making nationally.
Several other local firms have cut associate pay. Kilpatrick Stockton announced in early June a 10 percent associate pay cut, effective July 1. DLA Piper, Womble Carlyle Sandridge & Rice and Greenberg Traurig also have made 10 percent cuts.
Seyfarth Shaw cut associate pay by 5 percent to 20 percent, and Thompson Hine cut non-partner pay by $17,500. McKenna Long & Aldridge, which does not use a lockstep compensation system, cut starting salaries by $20,000 in April.
Alston's pay cuts follow other cost-saving measures. The firm offered early retirement packages to senior staff at the end of last year, followed by staff and associate layoffs in January and again in April. Alston also pushed back the start date for its new first-year class to January and reduced its summer program from 12 weeks to nine.