In 2010, the law firm of Cravath Swaine & Moore low-balled the market for bonuses, which was then steamrolled by the firm of Cahill Gordon. The low bonus scale set by Cravath last year was matched by the firm this year for the most part. Cahill is beating the scale set by Cravath again this year, but they are going one step further with their bonuses.
In 2011, Cahill is issuing a special bonus payment to its employees in their next paycheck. This bonus payment is coming before the company even hands out its year-end bonuses, which Cahill agrees Cravath has set at a low mark, simply by handing out bonuses much higher than the Cravath scale.
So now you must be wondering how special these early bonuses are?
The early bonuses are so special that Cahill is handing out $10,000 to every associate in each class year with their December 15 paycheck. Talk about having a Happy Holiday. This bonus in the December 15 paycheck will be in addition to the year-end bonus handed out by Cahill before December is complete. Experts believe that the year-end bonuses from Cahill will be just as good, if not better than, the Cravath bonuses. The associates at Cahill should consider the December 15 bonus as a down payment for the total bonus coming in two weeks.
Cahill did not send out memos to its associates about the bonuses. Instead, the firm called its partners to tell them of the news yesterday, according to Above the Law.
Experts believe that Cahill associates will be receiving year-end bonuses that beat the scale set by Cravath to go on top of the $10,000 they are receiving in their December 15 paychecks. Some of the Cahill associates received bonuses that totaled $35,000 more than the Cravath bonus for relevant class year in 2010. Representing the floor for Cahill associates is the Cravath scale plus the $10,000 the associates are receiving in their paychecks on December 15. There is no definite answer as to the Cahill scale but the bonuses could always get better.
In the bonus market of 2010, the majority of Cahill associates fared better than their colleagues at Cravath because of their spring bonuses. Cahill also pays its associates a mid-year bonus, with the last one being paid in June, ranging from $5,000-$25,000. As you can imagine, associates at Cahill are unbelievably happy right now. Here is the money Cahill associates are expected to pull down in 2011:
Associates will be receiving $10,000 now, a Cravath-like bonus at the end of the year. They also received $20,000 in June if they were hired in 2006. The year-end bonus should be around $25,000, which means an associated hired in 2006 will have pulled down $55,000 this year, which seems like a pretty good year.