Sullivan & Cromwell is set to add $17,500 (£11,000) to its first year associates’ pay packets, compared with the $15,000 (£9,400) that Cravath, and subsequently Fried Frank Harris Shriver & Jacobson and Shearman & Sterling, will award their lawyers.
New York firms which have so far announced bonus levels will all pay senior associates $25,000 (£16,000), compared with $50,000 (£32,000) last year and with the astronomical $100,000 (£63,000) awarded in 2000.
Overall, firms are anxious to keep bonus rates for first and second year qualifieds close to previous rates of around $20,000 (£13,000) as a ruse to attract new recruits.
Sullivan & Cromwell’s decision to pay slightly more at the bottom end is seen as a new benchmark for firms such as Dewey Ballantine and Cleary Gottlieb Steen & Hamilton, which are likely to pay slightly more than firms such as Cravath.
The higher rate is also expected to put Sullivan & Cromwell on a level pegging with Skadden Arps Slate Meagher & Flom which, although it awards the very minimum in terms of bonuses, pays first years $140,000 (£88,000). This is compared with the rest of the New York market which pays $125,000 (£79,000).