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For more than a year now Palo Alto, Calif.’s Wilson Sonsini Goodrich & Rosati has resembled an anorexic Hollywood starlet: growing steadily thinner while insisting nothing is wrong. In August 2000 Wilson Sonsini employed 679 full-time associates. Today it has about 545. Unlike its Silicon Valley counterparts, Wilson Sonsini won’t acknowledge that it’s cutting associates due to hard times — a posture that peeves the firm’s competitors mightily. Wilson Sonsini’s story is that the attrition is just part of the firm’s normal review process. Which raises the question: Just what sort of reviews are they doing, anyway? Recently, one axed Wilsonian helpfully sent us a batch of internal memos and schedules that details the system. Among the more interesting points is that there can be a big spread between what Wilson Sonsini says it pays associates and what they really make. For example, last year Wilson Sonsini told The Recorder, a San Francisco affiliate of law.com, that its seventh-year associates earned a base salary of $205,000. But the documents show that a seventh-year at Wilson Sonsini can actually make as little as $150,000. Why the disparity? According to internal memos, Wilson Sonsini uses a complex rating system that can substantially lower the base salaries of some midlevel and senior associates. Though this practice is not unheard of, other big firms, such as New York’s Thelen Reid & Priest and Palo Alto-based Fenwick & West, publicly disclose such salary ranges. Wilson Sonsini doesn’t. Nor does it explicitly tell all incoming associates about the ratings before they join the firm. Deborah Byron, Wilson Sonsini’s vice president of administration, says first-year recruits aren’t told about ratings because their compensation isn’t immediately affected by them. She says lateral hires are often told, but not always. In general, Byron says, the firm considers the ratings system proprietary and doesn’t discuss it outside the firm. Wilson’s system works like this. At the end of their third year, associates can be given one of several grades, ranging from a high of “H3″ to a low of “S.” According to a copy of the firm’s associate review policy, an H3 rating signifies that the associate is performing “at or above” the level expected for his class. An associate rated “H2″ is judged a “solid contributor” who needs to improve, while an “H1″ rating means that the associate is not performing at class level in key areas and risks termination. The bottom S rating means you’d better update that resume in a hurry. At the end of their fifth year, associates are also eligible to receive an “E” rating, a notch above the H3. According to the firm’s 2001-02 associate compensation schedule, midlevel associates who receive an H3 are paid the amount at the top of their class’ salary range. That’s the salary that Wilson publicizes for that class year. However, an associate given an H2 or lower rating has his or her base salary decreased in increments. For instance, according to the schedule, a fifth-year associate rated H3, the highest level, gets a salary of $185,000. But if that associate is rated H2, the salary falls to $160,000. An H1 or S rating results in a salary of $150,000. The spread is even greater for more senior associates. A seventh-year rated E gets the publicly reported $205,000 base pay, but H3s fall to $195,000, while H2s get $165,000, and H1- or S-rated seventh-years get only $150,000. Byron confirms that the salary numbers are “basically accurate” but says that they reflect Wilson Sonsini’s 2001 pay scale. She declined to provide updated salary figures. Byron also declined to say what percentage of associates are given lower ratings: “It’s not information we share outside the firm.” Wilson Sonsini has been varying base salaries for senior associates at least since 1995, and began differentiating for midlevel associates in 1996, Byron says. Among the 16 former Wilson Sonsini associates interviewed for this story, there was a split on how they viewed the ratings. Some remember being told at least something about ratings before joining the firm and viewed them as no big deal. Others don’t remember being told anything about ratings or salary ranges and felt deceived. To avoid hard feelings, might Wilson Sonsini inform all future recruits about its ratings system? “We’ll always answer questions about reviews,” Byron says. “If they ask us.” Related chart: Wilson Sonsini’s Pay by Numbers

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