Associates at the Dallas firm Bell Nunnally & Martin left a meeting Monday morning grinning ear-to-ear after being told they are receiving a raise between $40,000 and $48,000, effective immediately.
The 54-lawyer firm is matching the first-year pay adjustments made last summer by more than a dozen much larger firms in Texas after New York powerhouse Cravath, Swaine & Moore – considered the precedent setter for BigLaw pay – announced that it would increase its first-year associate salaries to $180,000.
Bell Nunnally currently has 17 associates and two more joining Sept. 1 fresh out of law school.
Asked if the recent BigLaw salary trend affected the firm’s decision, Bell Nunnally managing partner Jim Skochdopole said, “we make our own decisions, but those decisions are based in large part on the ability to continue to attract and retain the best associates.”
Skochdopole said the $180,000 first-year package includes a $165,000 base salary, as well as three guaranteed $5,000 bonuses: one “graduation bonus,” one “starting bonus,” and one “guaranteed year-end bonus.”
Fourth-year associates, on the other hand, will make a base salary of $190,000, plus a guaranteed year-end bonus of $5,000. The most senior associates will receive guaranteed bonuses of $10,000.
Skochdopole said the firm’s previous associate bonus structure was “discretionary” and was evaluated on an individual basis of performance, contribution, and career development, which resulted in allowing “aggressive compensation to strong performers.
“Because we have such strong associates, the new system assumes strong performance [across the board] and aggressively compensates everybody,” he said.
When asked if the associate pay raise would affect partner compensation, firm leaders said the two compensation structures are independent from one another.
“We have a partnership compensation policy that we’ve been very pleased with… we don’t see or feel a need to change that at this time,” said Christopher Trowbridge, one of the management committee members.
The announcement also comes as elite national firms continue to shake up the Texas legal market as they open up shop in Dallas and Houston by poaching top partner- and associate-level legal talent by offering astronomically higher salaries.
“While global and national firms are coming to Dallas, our firm is thriving in Dallas as a medium-sized firm,” Trowbridge said.
Jeff Lowenstein, who is also on the management committee, said an important benefit resulting from large firms moving to Dallas is the legal talent that is drawn to the city from elsewhere.
“We know we can compete with any firm as far as a place to go work and spend your career,” Lowenstein said. “We want to make sure that compensation doesn’t get in the way of people seeing what a great place this is to work.
“We’re confident that once they get here, it’s a place they want to spend their career,” Lowenstein added.