Sheppard Mullin Furloughs 33 Staffers Amid Coronavirus

By Hailey Konnath
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Law360 (April 13, 2020, 9:15 PM EDT) -- Sheppard Mullin Richter & Hampton LLP on Monday furloughed 33 of its 823 total staff members in response to the COVID-19 pandemic, noting that those affected can't perform their duties from home, according to a statement from the firm.

The Los Angeles-based firm said it has made no other decisions regarding additional furloughs, hours or pay reductions, but it added that it has "no intention of doing any layoffs" as the legal industry braces for an expected economic downturn as a result of the coronavirus.

"Our goal is to treat all of the Sheppard Mullin family fairly and with consideration, while making sure we remain a strong firm," Sheppard Mullin said in the statement.

Those furloughed include receptionists, support services and file center employees, according to the firm. The staff members were told to expect to return to work in two to three months and that Sheppard Mullin will pay for full medical benefits during their leave. The furloughed employees also won't have to contribute to their insurance costs, Sheppard Mullin said.

The firm also said its partners and senior management have contributed to a so-called bridge fund that will provide compensation to the furloughed staffers while they wait for unemployment benefits to kick in.

"These bridge funds are a grant, not a loan, and will not be paid back," Sheppard Mullin said in the statement.

A number of firms have cut pay or instituted furloughs or layoffs in recent weeks.

Also on Monday, Baker McKenzie said it would temporarily reduce salaries for all nonpartner attorneys, timekeepers and business professionals in the U.S. by 15% and Canadian attorneys and staff by 10%. Employees who earn less than $100,000 won't be affected by the pay cuts, the firm said.

Kilpatrick Townsend & Stockton LLP has also reduced pay for attorneys and staff, saying the firm was taking a proactive approach. And Goodwin Procter LLP said Friday that it was trimming its global operations team by laying off "a limited number" of nonattorney staff.

Meanwhile, in-house legal departments in the service industry have also been hit hard as the outbreak forces businesses like hotels to furlough law staff and slash general counsel pay to weather the financial impact. General counsel at Hilton Worldwide Inc., Marriott International, Macy's, The Cheesecake Factory and Walt Disney Co. are among the corporate executives shouldering pay reductions to share the pain and help keep their businesses afloat.

--Additional reporting by Michele Gorman, Xiumei Dong and Emma Cueto. Editing by Alanna Weissman.

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