St. Louis Associates May Feel West Coast Freeze

by Margaret Jackson

St. Louis Business Journal — January 11, 2002

With West coast law firms freezing associate salaries in 2002, it's unlikely that St. Louis law firms will increase pay for starting attorneys this year.

The salary freezes come after steady increases in starting pay since 1997, when a new associate at a St. Louis law firm could expect to earn $60,000 a year. In 1998, salaries increased to $70,000 and hit $74,000 by 1999.

"The large St. Louis law firms compete with large firms in other cities for the best talent graduating from some of the country's best law schools," said Bob Tomaso, a member of Blackwell Sanders Peper Martin's advisory committee. "When the large firms on the coasts do not increase starting salaries, we feel less pressure to increase as well."

San Francisco-based Brobeck, Philger and Harrison recently announced it will freeze associate salaries in 2002. Associates will not advance to their next lock-step salary level, leaving first-year and second-year associates earning the same base pay of $135,000 a year. 

Brobeck is the third West Coast firm to make an announcement about associate salaries. In August, Gray Cary, based in San Francisco, said it was freezing associates at their current salary level for six months, so they won't advance to their next lock-step until at least July. And last month Menlo Park, Calif.-based Venture Law Group reduced first-year salaries to $100,000 from $125,000 and cut base pay for third-years to $115,000 from $150,000.

Many St. Louis law firms have not yet decided what starting salaries this year will be. It's a decision Bryan Cave generally makes in late spring or early summer, said Lisa Martin, the firm's partner in charge of recruiting.

"We haven't considered anything yet," Martin said. "We'll make those decisions based on what the economic circumstances are then."

There has been some speculation that Bryan Cave will increase starting salaries, but it would not be a smart move at this point, said Aaron Williams, president of Aaron Consulting Inc., a nationwide lawyer recruiting firm based in St. Louis.

"Nationally, I think it's asinine that these numbers are holding for 2002," Williams said.

In fact, law firms should consider dropping associate starting salaries, Williams said.

"Bryan Cave and Sonnenschein are probably the only firms in St. Louis that would have the clout to change the market," Williams said. "If the other firms were to do it first, they would be perceived as 'in trouble.'"

Sonnenschein, Nath & Rosenthal has 468 attorneys nationwide, ranking second to Bryan Cave, which has 603 attorneys nationwide.

Jim Wiehl, a member of the policy and planning committee at Sonnenschein, said that while the firm would consider reducing salaries, it's committed to attracting and maintaining the highest caliber of lawyers.

"Our compensation will be at least the very competitive end of the market," Wiehl said.

The dot-com boom of 2000 took a number of high-quality associates out of the legal market, as they jumped at the opportunity to work for startups with the potential for making a lot of money through stock options.

"Now a number of very high-quality lawyers are back in the marketplace," Wiehl said. "One of the things we have seen is someone who might have been a fourth-year associate saying 'If you have a second-year slot, I'll take it.' There's quality talent at a more reasonable compensation level.