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Last month, six Venture Law Group associates were offered a deal. They could take a job at the Menlo Park, Calif.-based firm for one-third less money helping build the firm’s online resources for clients. Or they could find a place on the unemployment line. Four of them decided they’d rather have a steady gig than try to weather the increasingly moribund job market for lawyers. The other two decided to take their chances. “We thought it was an opportunity for people,” said Donald Keller Jr., a VLG partner. After cutting office and travel expenses, the firm was still faced with too many associates with too little work to do. “Frankly, from a morale perspective, it’s not healthy,” Keller said. The offer is just another signal of the lengths to which firms will go to cut costs. Last week, Gunderson Dettmer Stough Villenueve Franklin & Hachigian revealed that it withdrew its guarantee of an annual bonus to associates, and firms from Wilson Sonsini Goodrich & Rosati to Morrison & Foerster have aggressively trimmed underperforming associates. The downturn has been particularly acute for VLG, which based its business largely on taking stock in clients — a fine idea when the markets are soaring, but deadly in these post-tech boom times. In addition to the new, lower-paying jobs for associates, the firm trimmed 14 support staff and has also delayed the start date of its 14 incoming first-years to January 2002. Last year, VLG posted its best year to date, grossing $64 million and logging profits per partner of $905,000. But the firm is expecting a shortfall of as much as 15 percent on its revenue projections for this year. For the most part, the firm has been trying to avoid laying off associates, but acknowledges using more aggressive performance standards in judging its lawyers. That more stringent review led the firm to fire nine junior associates late last month. By offering to associates another six jobs developing the online project, the firm tried to reduce its ranks even further. It also rededicated employees to a project — online client resources — that it views as critical to the firm’s future success. The project will enable clients to access documents online and tap into other information that partners collect on the job, like how many stock options are awarded to a typical tech-company vice president. “We’re in desperate need of lawyer resources to further the project along,” said Joshua Green, the VLG partner in charge of the project. Earlier this year, the firm’s 100 lawyers each pledged to work 100 hours on the project. Though they have been given a reprieve, it’s still not clear if the associates will continue to have a job next year. They’ve been guaranteed work only through December. “We don’t know where it goes from there,” Keller said.

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