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Slightly less than one year after the last associate pay hike in Delaware, four Wilmington firms have raised their salaries again. On March 5, Morris Nichols Arsht & Tunnell and Potter Anderson & Corroon announced an across-the-board increase. First-year associates now make $145,000, up from $135,000. Two days later, Richards Layton & Finger announced the same increase in pay for first-year associates, effective March 1, raising the starting salary to $145,000. In addition, salaries for all the firm’s associates were raised commensurately. The $10,000 raise has been prorated for associates who’ve chosen flexible schedules. On March 8, Young Conaway Stargatt & Taylor also announced a $10,000 raise for full-time associates. Its first-year attorneys now make $145,000, and associates with flexible schedules received prorated increases. At Morris Nichols, some of the senior associates’ pay has increased by more than $10,000, according to Rodger D. Smith, hiring partner for the firm. The pay increase is “slightly more as you go up in seniority,” Smith said. “We want to avoid creating any compression for our upper-level associates who are, in a lot of ways, our most valuable.” Brenda Thompson of Thompson Search Consultants, a legal recruiting firm out of Newark, Del., said firms often consider sweetening the pot for mid- and upper-level associates. “The third to fifth year is the point when they start looking around,” she said. “Really, in their first couple of years a firm is investing in them, so they want to make it interesting so they’re not jumping to another firm.” At Potter Anderson, all associates are receiving a $10,000 increase. David B. Brown, chairman of the firm, said there is nothing automatic beyond that, but the pay hike was timed to coincide with an associate performance review program. “There certainly are differences between compensation at higher associate levels and lower ones. We’re always looking at merit,” Brown said. “We want to keep all our associates competitive and motivated.” Greg Williams, president of Richards Layton, said his firm recruits top talent from the nation’s leading law schools “in order to provide the highest-quality service to our clients. We’re increasing associate salaries to remain competitive in the national marketplace.” During the last round of pay hikes in Wilmington, which began in April 2006, Morris Nichols was the first to make the move, followed by Young Conaway. Morris Nichols was also the first firm to raise pay in the summer of 2004. This year, a wave of salary increases hit New York beginning on Jan. 22, when Simpson Thacher & Bartlett raised its first-year pay to $160,000, as previously reported by Delaware Law Weekly, a sister publication of The Legal. Most national firms followed suit, including Skadden Arps Slate Meagher & Flom and Fish & Richardson, both of which have offices in Wilmington. Pay is on the rise in Philadelphia as well. According to a recent report in The Legal, Wolf Block Schorr & Solis-Cohen raised its first-year pay to $135,000 and Morgan Lewis & Bockius and Dechert had previously raised it to $145,000. “We do like to be competitive even though our cost of living is significantly lower,” said Brown of Potter Anderson. “We work hand-in-hand with major firms in New York and Los Angeles and other major cities. The work certainly is as challenging and sophisticated as it is in any major city, and we’re up against the biggest firms in the country.” “Wilmington is not New York; nonetheless, we do want to remain competitive. When you consider the salary, the quality of practice and the livability of a city like Wilmington, we think it compares favorably,” said Williams of Richards Layton. James L. Patton Jr., chairman of Young Conaway, said his firm “is committed to recruiting top legal talent from the nation’s best law schools.” He added that Young Conaway looks to develop a total package of salary, mentoring and benefits plus sophisticated legal work to try and attract the best students. According to Thompson, the legal recruiter, while there has been some talk about the ever-expanding associate pay and when the run-up is likely to stop, a lot of firms are having their best year ever. “But in our area, the decrease in bankruptcy has affected every firm with a bankruptcy practice, especially if they have a significant practice,” she said. Smith from Morris Nichols said it was matter of making an economically rational decision for the firm. “You have to continue to attract the best law school talent to replenish your pipeline and you want to keep those who are in the pipeline happy,” Smith said. “You don’t want them to feel they are falling behind their colleagues at other firms and you want to entice the new law students graduating.” Prospects need to be convinced that the legal practice and the financial health of the firm can support the healthy salaries, Smith added. Would-be associates can then think about other factors, such as firm culture and opportunities for professional development. Williams said he believes the rising salaries reflect the increasing cost of education as well as the value that top lawyers can bring to their business clients. “We have predominantly a business clientele; we’re able to pay these salaries in part because our lawyers are providing a service that is sufficiently valuable,” he said. John Cirrinicione, a third-year student at the Widener University School of Law who will be working for Judge Raymond Batten of the New Jersey Superior Court after he graduates in May, said salary does factor into his decisions, “but I wouldn’t say it’s more than 40 or 50 percent. It’s not the deciding factor because I’ve heard from professors and student over the years that if you don’t like what you do every day, if you don’t like the people or the area, you are still going to be miserable.” Michael K. Reilly, an eighth-year associate who works on corporate transactions for Potter Anderson, said salary is no doubt important to any law student or associate, but that it’s not the only consideration. “It’s probably accurate to say that more and more, associates are considering other factors like the quality of the work and whether the work is challenging and whether there is a collegial work environment,” he said. Reilly himself moved to Potter Anderson when he was a fifth-year associate. He said that the fourth or fifth year is around the time associates begin to think about the future and whether to put in the effort to go for a partnership at a particular firm. “The only role salary played was, I wanted to make sure I was compensated at the same level. I didn’t want to make a step back.” Reilly said. “That’s one of the reasons why you see this market pressure. The big firms in Delaware don’t want to lag behind other firms.” Parts of this article first appeared in the Delaware Law Weekly , a publication of ALM. �

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