Seyfarth Defers Associates, Cuts Pay

By Elaine Meyer

Law360, New York (November 20, 2009) -- Seyfarth Shaw LLP announced Friday that it is pushing back the start date for half its incoming associate class from January to October 2010 and cutting pay for all first-year associates "in light of anticipated client demand and market conditions."

Seyfarth postponed for the second time the start date of 8 of the 16 new associates and said it will cut the pay of all first-years who start in 2010 by between 5 percent and 10 percent, according to an e-mailed statement from J. Stephen Poor, the firm's chair and managing partner.

The deferred associates will receive a stipend of $2,000 per month "to offset any disruption this may cause," the statement said.

Poor said the firm is trying "to ensure we are staffed appropriately to meet clients' anticipated needs." He said Seyfarth hopes to call the deferred associates in earlier if economic conditions improve but did not offer much optimism.

“While we see bright spots ahead in the economy for 2010, we also believe that economic conditions will continue to put pressure on our clients, including the costs of legal services, and we need to address those issues,” Poor said.

Seyfarth first deferred the 2009 class’ start dates to 2010 in May.

The 750-attorney firm has already canceled its 2010 summer program, instituted several rounds of layoffs and reduced associates’ salaries.

Seyfarth is the latest firm to defer associate start dates.

Shearman & Sterling LLP announced Nov. 4 that its 2009 summer associates would not begin until fall 2011 and will receive a $65,000 stipend for the deferral year.

And on Nov. 3 Winston & Strawn LLP pushed back the start date for incoming associates again, citing budget concerns in its decision to have new associates start in three groups throughout 2010.

Those deferred will receive $3,300 a month in stipends as well as subsidized health care insurance, according to a memo obtained by Above the Law.

Chadbourne & Parke LLP further deferred the start date of about half its incoming associate class in New York to an unspecified time in late September.

Alston & Bird LLP took a similar action in September when it again postponed the start date for some members of its incoming associate class from January 2010 to an unspecified point later in the year.

In August, Mintz Levin Cohn Ferris Glovsky & Popeo PC pushed back associate start dates for the second time. The firm, which already had deferred start dates until January, said half its incoming class would begin in April 2010, with the other half starting in January 2011.

And Skadden Arps Slate Meagher & Flom LLP said on Aug. 24 that it would cut the size of its 2010 summer associate program by more than half.

--Additional reporting by Tina Peng, Nick Brown, Ryan Davis and Melissa Lipman