San Francisco-based Brobeck Phleger & Harrison has resorted to freezing associate salaries to stave off the effects of the economic downturn.
The US firm has confirmed that associates will remain at their current lockstep salary level this year. First and second-year associates will continue to earn a basic annual salary of $135,000 (£93,600). The firm argued that, although associates would not proceed automatically up the lockstep, they are still receiving above the market rate.
Brobeck misjudged last year's market when it raised first-year salaries by $10,000
Firmwide managing partner Richard Parker said that Brobeck misjudged last year's market when it raised first-year salaries by $10,000 (£6,900). He said that market forces would dictate the pace of salary increases at other firms. Should they reach $135,000, Brobeck would consider raising its salaries to keep them above those of its competitors. The firm has been forced to adopt a number of cost-cutting measures in response to the slump in its core practice area. Corporate activity in the technology sector has dwindled, leaving the firm with a glut of highly-paid lawyers. The decision to freeze salaries follows 82 associates accepting the firm's offer of unpaid leave.