Nov. 30 is the date incoming associates with Haynes and Boone are scheduled to begin work with a starting salary for 2009 of $145,000. That’s below the $160,000 first-year salary that’s been the first-year BigTex market rate. Richard Fijolek of Dallas, the firm’s financial partner, says the firm hasn’t yet decided what it will pay those first-year lawyers once the calendar flips to 2010. “We haven’t decided what we are paying in 2010. We are trying to figure out what the market is,” Fijolek says. The $145,000 starting salary was first reported in the Above the Law blog. Fijolek says the firm is waiting to see where the BigTex market rate settles before deciding on a 2010 salary for first-year lawyers. “We are not trying to set market. We typically pay at the market or the high end of the market,” he says. Fijolek says the firm sent a letter to the incoming associates on Nov. 20 notifying the associates of their 2009 salary but also told them that they will spend most of December in training and will do little billable work. When the firm sent the incoming associates job offers in the fall of 2008, it did not specify a starting salary, he says. According to Texas Lawyer’s New Associates Survey, published on Oct. 19, 38 incoming associates are scheduled to start work on Nov. 30 at Haynes and Boone offices in Texas.
Rate Freezes
Even before the nation’s economy soured in the fall of 2008, corporate legal departments were cutting internal costs, negotiating alternative fee arrangements, and cutting or freezing the rates they pay outside counsel, consulting firm Hildebrandt reports in its 2009 Law Department Survey. The survey, made public Nov. 19, includes 2007 and 2008 data from 231 legal departments at private and public companies; 21 are based in Texas. According to the survey, 55 percent of the companies have or will use alternative billing, 64 percent have implemented or will implement rate freezes, and 46 percent have implemented or will implement rate reductions with outside counsel. Half of the companies report they have used or will use regional or boutique firms to cut outside counsel spending. Most of the companies, 63 percent, have no plans to reduce the number of lawyers or nonlawyer professionals in their legal department, and 59 percent have no plans to cut support staff. They companies have targeted “non-core” spending, with 82 percent of the companies indicating they have reduced or will reduce travel spending and 77 percent saying they have reduced or will reduce spending on meetings and training. More than half, 51 percent, have frozen or will freeze salaries for law department staff. Meanwhile, 57 percent of the companies have used or will use e-billing to cut spending. Hildebrandt, a Thomson Reuters business based in New Jersey, says the survey is “most reflective of the period leading into the economic downturn which began in mid-September 2008.”
