Law360 (November 17, 2020, 6:22 PM EST) -- Schiff Hardin LLP announced Tuesday it has reversed the salary cuts it made in April in anticipation of a pandemic-related downturn and paid employees back for the lost income.
Schiff Hardin is the latest BigLaw firm to undo its pay cuts amid a modest resurgence for the legal sector, which has seen slight job growth over the past six months and regained slightly less than half of the positions lost in April. The outlook of the industry mirrors job numbers across the economy overall: since hitting historic heights in April, joblessness has inched back down to 6.9% in October, twice what it was this February, with a full recovery still out of reach.
The firm said it had paid employees back for the pay cuts they had taken in the second and third quarters and had further decided to restore salaries for the fourth quarter, returning employees to pre-pandemic compensation levels.
"Like other firms, Schiff Hardin has been carefully managing its business in response to the economic impact of the pandemic. Despite the challenges 2020 has presented, the firm has performed well," a spokesperson for the firm told Law360.
In April, Schiff Hardin cut salaries by 15% for all staff making more than $100,000 and slashed pay by up to 50% for a select few, making up 6% of its attorneys, the firm told Law360. It also made a number of layoffs, deferred start dates for its new crop of associates until January 2021 and canceled its summer associate program.
There was no indication of the layoffs being reversed with new hires, though Schiff Hardin told Law360 in April that it had extended job offers for five second-year law students for after graduation. At some firms, including Baker Botts, Hogan Lovells and Baker Mackenzie, salary restorations have been made in tandem with more layoffs, though this was not the case at Schiff Harden.
Among the factors that helped Schiff Hardin weather the pandemic was a Paycheck Protection Program loan in the spring. The firm received a loan of $5 million to $10 million on April 6, according to data from the Small Business Administration.
Schiff Hardin was one of multiple major law firms that got the bailouts, which were intended for companies with fewer than 500 employees. This disqualified the largest BigLaw firms, but the likes of Schiff Hardin, with 321 employees, and even Boies Schiller Flexner at 490 employees, were able to snag the loans.
--Additional reporting by Kevin Penton and Justin Wise. Editing by Emily Kokoll.
For a reprint of this article, please contact firstname.lastname@example.org.