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ALA Currents is a free newsletter about law firm management trends and innovations
provided exclusively upon request to members of the Association of Legal Administrators.
News & Views
COMPENSATION FOR IN-HOUSE LAWYERS
UP SHARPLY
The newly issued 2007 Altman Weil Law Department Compensation Benchmarking Survey,
published with LexisNexis® Martindale-Hubbell®, reports that total cash compensation for in-house lawyer
positions in U.S. corporate law departments has risen across the board.
“In-house lawyers in management positions saw their total compensation rise between 8 percent and
14 percent this year, while non-management lawyers took home from 4.5 percent to 23 percent more,”
said Altman Weil Principal James Wilber.
Management Positions
Chief legal officer (CLO) salaries rose 5.8 percent to a median $300,000 in 2007, supplemented by a whopping
43 percent increase in bonus dollars of $157,400 according to the survey. Total cash compensation for CLOs
was up 14.3 percent overall.
Division general counsel earned 10.2 percent more in salary at $232,000, plus a median $104,600 bonus,
for a 13.7 percent increase in total compensation. Managing attorneys salaries rose 4.6 percent to a median
$179,900, augmented by $50,200 bonus – up 8.2 percent in total cash compensation from the prior year.
Deputy CLOs saw a slight dip in salary, down 1.7 percent to $215,000, but ended up ahead by 9.6 percent
in total cash compensation with an $84,000 median bonus.
Non-Management Lawyers
Lawyers in non-management positions also saw solid increases in total compensation. High level specialists
earned 6.4 percent more in salary, at a median $168,000, plus a 5 percent bump in bonus dollars of $44,000,
for an increase in total cash compensation of 5.1 percent.
Senior attorneys (non-managers with eight or more years of experience) took home 4.5 percent more
in total cash compensation; attorneys (with four or more years of experience) earned 11.2 percent more; and,
staff attorneys (attorneys with at least one year of experience) saw an increase of 23 percent. Recent graduates
earned 10.8 percent more overall in 2007, reporting a median salary of $70,600, plus $4,000 bonus.
“As the survey shows, increases in total cash compensation for non-management lawyers were significantly
higher for those of lesser experience. This may reflect a need to counter the dramatic increases in law firm starting
salaries as general counsel compete with law firms for talent,” said Wilber.
Stock Options
Stock options represent non-cash payments that can more than double the value of an in-house lawyer’s total
compensation package for those who receive them. Options for chief legal officers had a median fair market value
of $900,800 in 2007, down 2 percent from the prior year’s survey, but still worth more than twice the same group’s
total cash compensation. Stock options for other management positions range in value from 79 percent to 92 percent
of their total cash compensation. Non-management lawyers report median option values of between 33 percent and
49 percent of their cash compensation.
Some Key Variables
Size of law department is a key factor in top officer compensation. Chief legal officers in departments with over 25
lawyers took home $645,000 or 56.6 percent more than the national median in total cash compensation for all CLOs.
At the other end of the spectrum, CLOs in one-lawyer departments earned total cash compensation of $201,500,
only a little over half the national median.
In non-management positions, practice specialty is a significant differentiator.
“In this era of increasing compliance complexity and shareholder activism, it is not surprising corporations are
paying a premium for attorneys with in-demand practice specialties,” said John Lipsey, Vice President of Corporate
Counsel Services for Martindale-Hubbell. “For example, high level specialists with securities expertise earn top dollar,
21.8 percent more than the national median in total cash compensation.”
For more information, visit the Web site of Altman Weil.
Management Innovations
DEALING WITH DISCOVERY CHALLENGES
While a clear majority of corporate and law firm attorneys highly agree that having a functioning electronic
discovery strategy in place provides essential business benefits, 92 percent of the attorneys admitted that their
companies are vulnerable when it comes to being prepared for electronic discovery.
These are just a few of the key findings highlighted in a survey report issued by Océ Business Services.
“Dawn of the Discovery-Ready Enterprise” takes a close look at nine critical challenges corporate and law firm
attorneys are grappling with in order to deal with the growing tide of electronic discovery.
One of the nine critical challenges – inadequate records management – represents a major issue. Among
surveyed attorneys at companies that have a fully implemented records program, only eight percent say their
programs address electronically-stored-information (ESI) very well. Among attorneys at companies that lack a
fully implemented program, 26 percent say that their companies have no plans to implement a program and 17
percent don’t know whether or not their companies have any plans.
In considering the “insource vs. outsource” challenge, enterprises and law firms understand that business
process outsourcing is one of the components of an effective approach to conducting electronic discovery.
Sixty percent of enterprises plan to establish a mix of internal electronic discovery expertise and external
expertise. The prevalent law firm practice in managing client electronic discovery data is through a combination
of corporate applications and outsourced processing services.
Another major challenge is confusion about the Federal Rules of Civil Procedure. Only 10 percent of corporate
counsels say they understand changes to the FRCP very well. One-third state that they do not understand the
changes very well.
“As a result of these and other issues, legal departments are taking a more hands-on approach to litigation
management, particularly when it comes to electronically-stored information (ESI) and records management
programs,” said Doug Bean, Vice President and General Manager, Océ Business Services’ CaseData Division.
“Businesses focused on best practices intend to adopt repeatable discovery processes, technologies, and services
that will work for regulatory requests and internal investigations as well as litigation.”
Organizations become discovery-ready by shifting from a largely reactive response to taking action to achieve
superior improvements in discovery preparedness. To accomplish this, organizations are implementing new
methodologies such as a forward-thinking solution that Océ Business Services terms a Unified eDiscovery Platform.
This unified approach recognizes the interconnectivity of records, paper and electronic discovery, and compliance
processes.
For more information, visit Océ’s Web site.
Caucus Insights
This section features condensed versions of recent discussions in ALA’s Large Firm Administrators Caucus ListServe,
which is exclusively for people working in firms with 100 attorneys or more.
THE TOPIC: Blackberry vs. Treo
My technology committee is on the verge of recommending a switch to TreoTM, but I’m having a
hard time understanding if there are legitimate performance enhancements with Treos. If you considered switching, I
am interested to know why you decided to switch. Conversely, if you didn’t switch I’d like to know your reasons for
sticking with Blackberry®.
SELECTED RESPONSES:
1. We support both Blackberry and Treo. Far more of our users use the Blackberry, because
they find it to be a better e-mail solution. It is also less expensive when you consider the cost of
the device, data charges, and additional software such as GoodLink. Those that like having one
device for phone, e-mail, and scheduler like the Treo.
2. I am a committed Treo user as I like the multiple functionality. But most of the Type A’s I
work for give greater weight to the value of instantaneous e-mail, and therefore prefer Blackberry.
We support both.
3. We went through this analysis and decided that the chances were slim that Blackberry was
going away so we recently ordered 100 new Blackberries. We field tested them against the Treo
and our lawyers who tried the Treos did not like them as much as the Blackberry devices.
4. We also had a small group test the Treo and decided to stick with the Blackberry. We have
decided not to replace any of our existing older versions of the Blackberry for now but we are
replacing those that fail with a new Blackberry.
5. We support both devices. The firm does not pay for the devices. Most of our attorneys are
moving to the Treo. About three of our lawyers are using the all-in-one Blackberry with good reviews.
6. We are rolling out Treos to everyone, replacing all data-only devices and providing the
“business cell-phone” capability of the Treo. We’re using Sprint on a corporate shared-minute plan.
Generally people are pleased with the Treos performance and Sprint’s coverage and service.
7. We were a Blackberry firm, but two years ago, after extensive testing both by our IT folks
and a few sample groups of attorneys, we switched to Treos. Our lawyers have been uniformly
pleased that we did so; they much prefer the Treo to the Blackberry because of its more
extensive features and better screen lighting. Our service issues have been nil (knock on wood)
and because of favorable contracts we were able to work out, cost has not been an issue.
8. We have installed the GoodLink server as a back-up plan. Our test of the Treo has
convinced us that’s not the way to go (harder to use and Verizon requires a two-year commitment).
We’re looking to see if there’s another unit/carrier to use with GoodLink that’s more Blackberry like.
Special Note: ALA members have free access to the ALA Reference Desk. Send questions on legal
management to infocentral@alanet.org. Staff will conduct
personal research on each question.
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