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Law360 (December 11, 2020, 3:50 PM EST ) Kelley Drye & Warren LLP has announced that the firm will fully restore salaries to workers at the beginning of January after instituting pay cuts early in the coronavirus pandemic to mitigate economic uncertainties.
Kelley Drye Executive Committee Chair James Carr said in an email to employees Thursday that in the beginning of the pandemic it instituted careful planning and various cost-cutting measures to ensure the continued economic vitality of the firm.
"After an initial slowdown in demand for our services, we saw in the late summer a rebound in our level of work, which accelerated in the fall," Carr said in the email. "Client demand has exceeded our projections back in May when we reduced partner compensation as well as lawyer and staff salaries."
Kelley Drye first warned its attorneys in April that pay cuts were on deck, when it unveiled a salary reduction for all employees making more than $100,000 annually as well as cuts to equity partner compensation. The firm also had equity partners' draws reduced by as much as 20% beginning at the end of April and postponed July 1 raises for administrative staff.
The firm later rolled back some of the austerity measures enacted earlier in the year when it decided pay cuts for associates, special counsel and staff earning more than $100,000 annually would be reduced to 5%.
Carr said that Kelley Drye will restore salaries for stipulated payment partners, special counsel and associates, and impacted administrative staff. Salaries that were withheld from May 1 through the end of December will be repaid in a lump sum at the end of the year, he said.
Carr said that equity partner draws will return to their previous levels at the beginning of January 2021. Carr said the firm is optimistic that it will conclude the year in better shape than it anticipated.
"This decision reflects our optimism for the continued financial health of Kelley Drye as well as our sincere gratitude to everyone who worked so hard to make this possible," Carr said.
In the face of the pandemic, and the resulting economic downturn, firms around the world implemented cost-cutting measures such as furloughing employees and slashing salaries. A handful of firms have at least partially rolled back these measures in recent months.
--Additional reporting by Hailey Konnath and Michele Gorman. Editing by Alyssa Miller.
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