Member Groups

General Practice, Solo & Small Firm
The newsletter of the ISBA’s General Practice, Solo & Small Firm Section

November 2006, vol. 35, no. 4

Salary negotiations for the small firm associate

For most of us who read this newsletter, the concept of obtaining a six-figure salary straight out of law school was nothing but a dream; yet, for those friends of ours who chose the path of the 100+ attorney law firms it was a reality. Sure, those same attorneys may work like dogs every day of the week (and weekend) and are fixated on making their billing requirements, but when their pay check is deposited in their account they manage to find a way to live with it.

The simple fact is that while we all of went to law school with idealistic dreams of practicing law most of us also were teased with the prospect of making a few dollars to pay the bills (and perhaps buy that little red sports car).

While few small firms have the ability to pay the sizable salaries of the big firms this doesn’t mean that you should simply sit back and not do your research when it comes time for salary negations. Consider the following when engaging in salary negotiations in the small firm setting:

1. Know what the position entails. This may sound simple enough; however, it isn’t just a matter of asking if there is a billable hour requirement. For instance, if the position requires you to travel out of or around the state on a regular basis you’ll want to know how reimbursement for transportation cost will be handled. Not knowing such a fact could be costly.

2. Understand how you fit the position and can contribute to the firm. For instance, if you are joining a bankruptcy firm and don’t have any experience in the field, don’t expect too much in the way of negotiating power. Conversely if you have conducted a dozen jury trials and you’re joining a litigation firm you should have an edge that may warrant a higher salary.

3. Consider the firm's history, present circumstances, and future prospects regarding business and legal work. If a firm has been through a rough spell with either a downturn in business or cost over runs they will likely be looking to cut costs, not increase them. If the firm recently took on a new client or case that has the potential of generating a substantial amount of business they will likely be in a position where they need help fast and are more willing to pay for it.

4. Know how much you are “worth.” Establishing a dollar amount in this regard is a massive challenge for most attorneys; however, you don’t have to go it alone. How much an attorney is worth is generally based on their experience and where they work. Knowing what your peers in the same geographical region are making is key to determining this value. Outside of being tacky and asking others show much they get paid, consider conducting searches on the internet or consulting a salary guide from a legal staffing company such as Robert Half Legal at www.roberthalflegal.com. Such guides can be tailored to your firm size, years of experience and geographical region.

5. Understand the market conditions for other attorneys with your experience. If you just passed the bar exam (along with a few thousand of your closest friends) and you have no experience, don’t expect to receive keys to a company car or a big signing bonus. If you have been out for a few years and managed to log a few good credentials that separate you from your peers you’ll certainly have more power at the negotiating table.

6. Realize that you are being hired or employed with the intent of saving or making the firm money. While I disagree that “money is the root of all evil,” I think that greed might be. Realize that even if you are the best attorney in your field the partners don’t tend to be interested in spending their money when it’s not necessary. If you are going to cost the firm more money than you’re going to make it, don’t count on sticking around for too long.

7. Know that your “institutional memory” has value. If you have been employed with a firm long enough to learn “the system” and establish a good relationship with others in your office you are inherently worth more than you’re getting paid. The “cost” of hiring a new person to fill your position will almost always be more expensive than giving you a reasonable raise. Outside of spending the time and money to find a new employee to fill your shoes your employer is inevitably concerned with personality conflicts that could pop up or whether or not a new person will truly live up to their resume when it comes to bringing a new person into the mix. Avoiding such expenses that come with hiring a new employee has its own intrinsic value.

8. Consider what benefits you’ll receive that aren’t part of your regular salary. If your employer pays not only your salary but also provides health insurance then find out what percentage of the insurance premium you will be expected to pay. If the amount is negligible you may want to set your salary expectations a little lower. If you’re part of a group plan but you have to pay a substantial portion then you’ll ultimately take home less of your salary and you may need to ask for more in your salary base.

9. Know the person you are negotiating with. Does the person across the desk appreciate strong advocacy? If so they might also respect the fact that you are willing to ask for that raise and not necessarily cave upon their first offer. Some attorneys are all about the numbers, if your employer is such a person then consider showing them how you benefit the firm and make it more profitable dollar for dollar. Most importantly, do not assume that one strategy for salary negotiations will work within every situation as each employer is intrinsically different.

10. Consider “alternative” negotiating points other than money. While your firm may have financial constraints that keep it from being able to give you that extra $5,000, they may be open to considering an “alternative” form of compensation such as an extra week paid vacation. Other items they may consider paying for as part of your overall compensation include bar association fees, ARDC costs, a cell phone or a company car. Each of these “alternative” forms of compensation, and others, provide your employer with a potential tax deduction as ordinary business expenses they might not otherwise get.

Finally keep a good attitude throughout the process. While you may get a knot in your stomach when considering the prospect of entering salary negotiations with your employer or potential employer guess what, your not alone. Salary negotiations can be difficult for not just the employee but also for the employer. If you think “win–win” during salary negotiations you are more likely to be able to walk away from the table being satisfied with your compensation package and your employer will be relieved to know they have made a good financial decision and investment in you.

While following these steps won’t guarantee you’ll see those “big firm” numbers offered to you it will improve your chances of being able to afford that little red sports car. Besides, one thing is for certain when it comes to salary negotiations, if you don’t ask for more you certainly shouldn’t expect to see any extra zeros in your paycheck.

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About the Author: Joseph P. Giamanco is engaged in the practice of law at Stride, Craddock & Stride in Chicago, Illinois. He is a member of the ISBA General Practice Solo & Small Firm Section Council Member.