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Law360 (October 8, 2020, 4:07 PM EDT) -- More than one-third of corporate law departments said it's too early to gauge the impact of the pandemic on salary bumps in 2021, but some expect they will need to eliminate or freeze merit increases, according to a report released Thursday.
Out of 123 companies that answered that question in the Association of Corporate Counsel's 2020 Law Department Compensation Policies & Practices Report, about 36% said it's too early to forecast the extent of the pandemic's effect on salaries next year, while about 14% said they don't think they will be able to offer merit increases and nearly 11% predicted a merit budget freeze.
The ACC, which published the report along with human resources consulting firm Empsight International LLC, collected data between June and July from 608 organizations in industries including technology, financial services, real estate, consumer products, insurance and energy. The number of participants varies by question because not every organization provided a response for each section.
The report also asked businesses about their hiring practices this year. Of the 259 organizations that answered, about 16% to 18% said they've enacted hiring freezes across all law department roles as a result of COVID-19, while 70% to 78% said their plans haven't changed.
And while a majority of participants reported no furloughs, layoffs or reductions, between 0.6% and 4.3% of companies said they've furloughed staff, and between 0.5% and 1.8% said they've had to conduct layoffs, according to that part of the report in which 272 companies participated.
Regarding work-from-home policies, about 15% of companies said they're thinking about maintaining a full-time remote policy once the pandemic wanes, while 29% said they're planning to move forward with a part-time remote program, the data from 599 companies show.
The report also asked law departments about which legal areas have been most affected in 2020. Out of 548 participants, about 24% said there has been an increase in outside employment/human resources counsel, followed by compliance at 12% and environmental health and safety at 11.8%. Nine percent indicated a decreased use of outside counsel for general legal matters.
Some general counsel this year have expressed concerns about attorney morale. An earlier ACC poll released in June found that nearly a third of in-house counsel were experiencing high or very high burnout amid the pandemic.
The report published Thursday showed that the majority of 576 organizations didn't offer additional compensation such as salary adjustments or short-term incentives to account for any extra hours employees are working during the pandemic.
The report also asked companies about accommodations put into place or considered to address employees' personal needs during the pandemic. Of the 557 organizations that responded, they most frequently cited flexible hours, special programs for high-risk employees, use of vacation time and voluntary leaves of absence.
--Additional reporting by Dave Simpson. Editing by Alanna Weissman.
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