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Ruden McClosky Slashes Pay, Lays Off 8 Lawyers
Daily Business Review
July 06, 2009
Fort Lauderdale, Fla.-based Ruden McClosky has laid off eight more attorneys as part of a cost-reduction effort that included 18 percent pay cuts for most of its lawyers, according to firm and other legal industry sources.
A Ruden McClosky attorney confirmed that eight associates were cut late last month. The cuts come on top of a round of 20 dismissals that included two attorneys in the spring. Two attorneys were cut at the beginning of the year and 15 secretaries and a real estate associate were dismissed late last year.
The Ruden McClosky lawyers who lost their jobs in the latest round of job cuts worked in the firm's litigation, corporate and land-use practice areas in South Florida. The layoffs came following meetings with partners and associates in the final week of June to announce the pay cuts.
At the meetings, firm leaders announced that partners were not likely to receive their holdbacks of 18 percent of their pay this year and that associates and non-equity partners would receive an 18 percent pay cut through at least December.
Carl Schuster, the firm's president and managing director, declined to comment through a spokeswoman.
Ruden has suffered the most severe financial slide of large South Florida firms that report their revenue in surveys for the Daily Business Review's Review 100 and American Lawyer's Am Law 200 law firm rankings. Ruden's gross revenue dropped by 9 percent to $85.3 million in fiscal year 2008.
The Daily Business Review earlier reported that a Ruden McClosky partner said associates and non-equity partners would receive a 9 percent pay cut. But that 9 percent represents the 18 percent pay cut on annualized basis for all of 2009, another Ruden attorney later said.
The attorney, who asked not to be named, said management indicated salary cuts might be restored next year.
The attorney said Schuster told associates late last year that partners did not receive bonuses or their holdbacks for 2008 even as the firm paid bonuses and offered pay raises to associates.
Schuster recently confirmed to the Daily Business Review that about 20 jobs were cut earlier this year, including two attorney positions, but he declined to provide an exact count of job cuts.
The Ruden attorney said during a round of cuts early this year, five partners were asked to leave, while a corporate associate and a land-use clerk were also let go. Also, another land-use associate was let go in the middle of last year.
The attorney said talk at the firm is that Ruden is $4 million to $6 million behind its budget goals for the year. The attorney said morale at the firm has declined because of the job and pay cuts and uncertainty about whether there will be more and added that many of the firm's lawyers are searching for other jobs.
"Everybody from the bottom up thinks it's a matter of time for them; you don't know what to believe," the attorney said.
