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Law360 (April 3, 2020, 8:47 PM EDT) -- Nixon Peabody LLP plans to furlough 25% of its staff members as the effects of the novel coronavirus percolate through the legal industry and the broader economy, according to a published report.
The firm will furlough the employees beginning Monday, with the policy remaining in place "until further notice," according to a report Friday in Above the Law.
Nixon Peabody officials could not be reached Friday for comment.
The furloughs at Nixon Peabody come as law firms are only beginning to announce layoffs, furloughs, cuts in pay and other measures to reduce costs as the economic upheaval caused by the spread of COVID-19 begins to hit the industry.
Among the announcements in recent days, Pryor Cashman LLP said it would furlough some associates, Loeb & Loeb LLP announced it would slash attorney and staff pay to avoid layoffs and Baker Donelson Bearman Caldwell & Berkowitz PC said it would cut pay and furlough some employees.
Meanwhile, Cadwalader Wickersham & Taft LLP announced it was pausing partner distributions and cutting associate and staff pay, and Reed Smith LLP said it would slow partner cash distributions.
Employment in the legal industry dropped in March from a 10-year high in February, giving up the gains seen during the previous month, according to U.S. Department of Labor data released Friday.
The number of legal sector jobs fell from about 1,162,600 in February to 1,160,500, a decrease of nearly 0.15% based on the seasonally adjusted numbers from the Bureau of Labor Statistics. It follows a period of increases in four of the previous five months, according to the data.
The reports on cost-cutting measures taken by midsize and large law firms will likely flood in as firms realize the gravity of the economic downturn caused by the COVID-19 pandemic, Larry Watanabe of legal recruiting firm Watanabe Schwartz told Law360 in late March.
"I think we're beginning to see the tip of the iceberg," he said.
--Additional reporting by Aebra Coe. Editing by Amy Rowe.
For a reprint of this article, please contact reprints@law360.com.
