The number of law firms announcing salary cuts for lawyers and staff is increasing daily. After years of bemoaning growing salary levels for associates and senior staff members, there seems to be an element of glee as some firms consider the opportunity to take back some of the salaries and perks granted over the past decade.   The issue seems not to be whether firms should cut salaries but, rather, by how much. 

Because few firms are hiring, there is little market definition of what are appropriate salaries; therefore, salary reductions seem to be more related to what would be tolerated by employees and what is consistent with what other law firms are doing. That, unfortunately, is the rub -- associate and senior staff salary cuts range from minor three to five percent reductions to significant 20 percent reductions and there seems to be little consistency by geographic location or practice. Some HR experts tell us that the amount may be of less importance than the timing. The advice is to take the action early to resolve the anxiety brought on by uncertainty. 

The announcement itself should come in an open, business-like manner with a minimum of apology or attempts to deflect responsibility. The salary reductions are a necessary reaction to a recession that has dramatically cut the firm’s revenue. An e-mail is an acceptable means of conveying the information provided that arrangements are made to respond to questions. The HR department staff should be prepared with details of when the reduction will become effective, how it will impact deductions, pension contributions and disability insurance.

The number of law firms announcing salary cuts for lawyers and staff is increasing daily. After years of bemoaning growing salary levels for associates and senior staff members, there seems to be an element of glee as some firms consider the opportunity to take back some of the salaries and perks granted over the past decade.   The issue seems not to be whether firms should cut salaries but, rather, by how much. 

Because few firms are hiring, there is little market definition of what are appropriate salaries; therefore, salary reductions seem to be more related to what would be tolerated by employees and what is consistent with what other law firms are doing. That, unfortunately, is the rub -- associate and senior staff salary cuts range from minor three to five percent reductions to significant 20 percent reductions and there seems to be little consistency by geographic location or practice. Some HR experts tell us that the amount may be of less importance than the timing. The advice is to take the action early to resolve the anxiety brought on by uncertainty. 

The announcement itself should come in an open, business-like manner with a minimum of apology or attempts to deflect responsibility. The salary reductions are a necessary reaction to a recession that has dramatically cut the firm’s revenue. An e-mail is an acceptable means of conveying the information provided that arrangements are made to respond to questions. The HR department staff should be prepared with details of when the reduction will become effective, how it will impact deductions, pension contributions and disability insurance.

The reduction of employee salaries also provides an opportunity to eliminate some non-insurance benefit programs that may no longer be appropriate. Many firms created policies to reimburse cellular telephone usage and at home high speed data lines at times when such expenses were exotic technological innovations. Today they are routine household expenses. A number of firms have told us they are cutting back heavily on meal service for noon firm-business meetings. Some firms are simply not paying for lunch meetings and others are reducing the quality and expense of food being served.

At the same time that some traditional benefits are being eliminated, a number of firms are attempting to provide some new, creative benefits that are comparatively inexpensive. One of the most popular is to create inexpensive social events. We know of one firm that had a football draft party in the firm’s offices. The firm provided a keg of beer and soda. Participants brought a pot luck dish to share. Several firm’s heavily promoted last week’s Take Your Child to Work Day and a smaller firm created a “24” club that meets at partners’ houses to watch the popular TV program. Lawyers and staff are invited. No alcohol is served and attendees bring a dessert to share. We are also hearing about a resurgence in bowling leagues, softball teams and other firm sponsored activities.

Law firms face a conundrum concerning actions in response to the swine flu threat. On one hand, firms want to be pro-active in dealing with a major public health issue. On the other, cutbacks in staff have many firms operating short-handed and can’t handle large scale absenteeism.   The problem is the work ethic of lawyers and law firm staff that causes workers to routinely come to work, even went ill. The economic crisis has worsened this problem as many employees fear they will be targeted for layoff if they take sick leave. This, combined with the close working conditions and recycled air in offices, makes them comparatively high risk environments for the flu. 

Of the Center for Disease Control’s recommendations, three should be top priorities for law firms: 

1.      Partners and employees should be strongly advised to monitor their health and, if their temperature rises above 101 degrees, they should stay at home or return home from work and then contact their doctor.   This may require an affirmative policy by the firm about absenteeism.  For example, a phrased already adopted by some firms is, “If you are not sure whether you are too sick to come to work – stay home.”

2.      Bottles of liquid hand sanitizer or baskets of sanitizing wipes should be placed in all common areas such as coffee stations, convenience copiers and file areas. Encourage employees to wash their hands frequently and consider providing inexpensive masks for those employees desiring further protection.

3.      Develop policies in advance for sending people home and for people who refuse to come to work because they fear catching the flu. A common policy for sending people home is if they are coughing or shivering or appear to have a fever. 

4.      Consider extending the number of days of sick leave or FMLA to cover flu of the employee or their child.

5.      Develop telecommuting protocols for people who have to stay home or are fearful of coming to work.

For the uninformed, Twitter.com is one of a number of social networking sites that include Facebook, YouTube, Flickr, StumpleUpon, Tumblr, Utterli, and countless others. Twitter allows members to post short “tweets” with a maximum of 140 characters. Members may choose other members they want to “follow” which means they receive their tweets. This may sound innocent enough until you realize that there are more than 8 million members of Twitter, many of whom provide very specific information about who they are and their employer in their profile (which all members can access). 

Although we have come across a number of articles by employment lawyers about social networks, we have been unable to find a firm that has actually disseminated such a policy. The suggested content of a Twitter policy includes:

In the last edition of Recruiting Trends we talked about a question from an administrator who was concerned about the part time work of some of her staff as strippers.  Because the article was sent out on April 1^st, a lot of readers thought it was an April Fools joke (it wasn’t). But a number of readers commented that they were immediately going to create such a policy. If your firm was one that created such a policy, please send us a copy so we can make it available to a number of firms that have requested it.