Ropes & Gray has been offering associates retention bonuses of up to $50,000 per person in order to prevent mass exits in the wake of a stream of partner departures.
The payments, which are separate to the firm’s normal associate bonuses, have been offered to a number of associates in Hong Kong, London and the U.S. in recent months in teams that have seen partners leave.
According to former partners, roughly five associates in London were offered payments of around £20,000 ($26,580), while other former partners claim that several associates in Hong Kong and the U.S. were offered up to $50,000 to stay at the firm.
Ropes & Gray made the counteroffers after a number of associates whose partners had moved on to other firms were approached to follow them. Sources have suggested to Legal Week that around 60 percent of Ropes & Gray’s counteroffers to associates had been accepted. First-year associates in the firm’s London office, which opened in 2009, earn nearly New York rates at £115,000 per year ($153,134) and base pay has not been changed. (The post-Brexit slump of the British pound has reportedly resulted in higher pay days for some young London lawyers.)
Ropes & Gray has watched at least 22 partners leave the firm globally since the start of 2017, including a seven-partner enforcement team that left in August and joined Kirkland & Ellis in Boston, Chicago, Hong Kong, London and New York.
Other firms that have raided Ropes & Gray’s ranks in recent months include King & Spalding, which took on a pair of London-based finance partners in June, and Dechert, which welcomed aboard investment funds partner Monica Gogna in September. White & Case also hired Ropes & Gray structured finance partner Chris McGarry in London, while Linklaters landed Ropes & Gray restructuring partner James Douglas.
Earlier this month, Ropes & Gray saw investment funds partner Mark Gurevich in New York leave the firm to become managing director and deputy general counsel at Maverick Capital, a $10.5 billion hedge fund. But Ropes & Gray also brought back former associate Michael Szkodzinski as counsel for its hedge funds group in Boston, where he had spent the past two years as an associate general counsel at Boston-based Weiss Asset Management LP.
While rumors of tension with management and dissatisfaction with Ropes & Gray’s infamous “black box” remuneration structure abound, the firm’s leadership has sought to stress that Ropes & Gray is having a good year and that most exits from the partnerships are not bad news for the firm.
“We have lost some people we’d rather not have lost—but that’s the nature of the business,” said Ropes & Gray managing partner David Chapin to Legal Week in September. “We have really good partners that other firms want—if I wasn’t having my partners recruited I’d be worried about the kind of partners we had. We don’t get too hung up on short-term fluctuations.”
Ropes & Gray declined to comment on the retention bonuses being paid to associates.