Money isn't everything.

That, at least, is what several firms in Big Law want to believe as they continue to roll out perks and initiatives to lure and retain associates.

Last week, Reed Smith—a firm that has chosen not to match the top dollar many law firms pay their associates—unveiled a new slate of perks for its attorneys, including changes to the firm's billable hour policy, a continuing education track and an internal recognition program.

“Reed Smith should be applauded, and I wish more firms would think of creative ways to hire people instead of being on an auction block,” said Joe Ankus, a 30-year legal recruiter and founder of Ankus Consulting.

The firm rejected the $190,000 associate benchmark set by Milbank last year, citing the “interest of its clients,” and first-year salaries hover between $150,000 and $180,000 according to ALM's Legal Compass. That trend could be growing: A 2019 report by the National Association for Law Placement found that fewer firms have followed Milbank's lead.

Greenberg Traurig also refused to engage in the salary war and instead has focused on offering associates what it considers a more rounded experience. The firm offers alternative attorney tracks, online career development platforms and law firm economic training sessions conducted by co-president Brad Kaufman, among other programs.

“Compensation is only one part of the total associate package,” he said. “We are committed to helping our associates enhance their core competencies, deliver positive and urgent client service and build their business development skills, while also creating a collaborative environment and recognizing the need for maintaining a work-life balance.”

To be sure, it's not easy to quantify the value of these attract-and-retain initiatives or measure how effective they are in luring and keeping associates who might be considering higher-paying offers. But Scott Westfahl, who consults with numerous Am Law 100 firms as director of executive education at Harvard Law School, calls the salary wars “a race to the bottom,” noting that big salaries aren't enough to differentiate a firm from its competitors.

“The value proposition for talent at a law firm, if it isn't differentiated on other metrics, boils down to salaries,” Westfahl said. “Then everybody is losing profitability instead of creating a differentiated model.”

Estimates indicate the cost of the last associate salary hike may run as high as seven figures for a large firm like Milbank, and corporate clients have made it clear they aren't happy about the yearly raises, as the cost is often passed along to them in the form of higher billing rates. Attrition is also still a major issue across the career spectrum: 47% of laterals leave within five years.

While many firms now offer business development training and flexible work schedules for attorneys going on leave, Westfahl said it's paramount that these perks are front and center in the firm's recruitment process.

“One you have to differentiate, two you have to market,” he said. “The hottest topic in the corporate talent world is brand differentiation.”

Even firms that did raise salaries have developed policies similar to Reed Smith's.

Milbank, for example, has its own education program—Milbank@Harvard—which is administered with the help of Westfahl. All fourth-, fifth- and sixth-year associates take business classes at Harvard University each year to learn about finance, business development and marketing. Simpson Thacher & Bartlett has a similar arrangement with Columbia Business School.

“It definitely helps our lateral recruiting,” said Milbank partner and executive director David Wolfson. “Our ability to train people within Milbank is one of the most important when you join us. We can give you lots of money, but it doesn't have the same value over the course of your life.”

Other training programs at Milbank are specific to practice areas. Deals@Milbank teaches transactional skills such as drafting and negotiating; Advocacy@Milbank trains litigators in such skills such as presentation and writing. The firm also has moved into a new 250,000-square-foot office in Manhattan's new and trendy Hudson Yards in an effort to modernize its image.

Akin Gump Strauss Hauer & Feld also has special associate initiatives, such as a short-term travel program that allows lawyers at the third-year level and above to spend time in other offices. And, like at Reed Smith, many of its special programs originated from associate committee meetings or hackathons—a very important asset in the recruiting market, said Lauren Marsh, Akin Gump's director of attorney recruiting.

“These changes were important to our chairperson Kim Koopersmith and senior leaders,” Marsh said. “Being able to tell potential hires that many of these policies came out of suggestions from associates reflects that the firm is willing to hear them out and ensure they're satisfied.”

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