If you stood outside the AT&T Center on June 15th at 9:10 p.m. local time, you would have witnessed a steady stream of crestfallen Miami Heat fans bemoaning the performance of anyone other than Lebron James. Ask any of those fans if they thought Chris Bosh was worth a max contract in the off-season and they most likely would have answered “No!” with feverish enthusiasm.
Fast forward to the off-season, teams have now expressed interest in signing Bosh to a max-contract sheet. As it stands on Thursday, July 8, the Rockets are willing to pay him $22 million a year.
So what does this mean for you? It means that just because your law firm tells you that you’re worth a certain amount of dollars does not mean you can’t secure more greenbacks. Salary negotiations are tricky, and it is helpful to get in touch with a recruiter before you attempt to renegotiate with your current firm. Before you start maneuvering, here are five pointers to consider before strategizing…
1. Lateral Moves: A lateral move is usually one of the easiest ways to bump your pay by creating a market or realizing a 10-20% bump in compensation. A large portion of the moves we facilitate are from partners looking for a bigger payday or something that they see is closer to their market value. It is simply the nature of the business that different firms will value you at different levels—much like Bosh means more to Houston as a complement to Dwight Howard than he does to Miami as a stretch center. You should leverage the market to maximize your payday. After twelve years of prep, four years of undergrad (or maybe five to the ire of your parents), three years of law school and possibly eight years as an associate, partnership is your chance for payday. What may seem like a marginal increase in pay can compound immensely after a 20-30 year partnership and any increase in pay can also provide grounds for future increases as well. Don’t simply just chase the next payday, but rather make sure it sets up the subsequent ones as well.
2. Approach Management: Tactfully make your case to firm management. Whatever you do, do not go on a fishing expedition. If you approach management without doing your research, they will not recognize your efforts and most likely you won’t get any offer at all. There are numerous resources available to partners to help them figure out their market worth. You can call me or anyone else at Lateral Link for advice. If you try to negotiate without help, you are negotiating against yourself since you don’t have market information as a starting point. If you do not feel like talking to a recruiter, there are many free resources available to you so you can try to ascertain your maximum market value. But like Yelp and other user-generated-content sites, you probably won’t find the data realistic for your pay grade. That said, sites like Glassdoor may help you compare your salary to those of attorneys at other firms. Recruiters have access to a bevy of tools to help you figure out your potential salary and where you can get it.
Recent laterals are also a good indicator of what you are worth on the market—albeit not always at your firm. If a partner with a similar background laterals to your firm with a significantly higher salary, go to management and show them that this is indicative of an increase in your value as well.
3. Grow Your Business: A lot of the best lawyers feel that cultivating clients is not their strong suit and that their highest and best value is to practice a purely intellectual and unadulterated profession that should be unsullied by anything else. Unless you practice at a firm like Cravath with lots of institutional clients, this idealistic style of legal sanctity will quickly quell your aspirations of moving up the ladder.
Fostering relationships is essential in any facet of life and law is not an exception. In a world of increased transparency with attorney’s information, aptitude and clientele more readily available than ever before, business development has become essential in the face of stickier market rates. You must distinguish yourself from the thousands of other lawyers with similar pedigrees if you wish to increase your salary. You can always hire great help to work on your matters as long as your clients trust your judgment.
When you first look to increase your business, the easiest place to look is at your existing clients. Keep track of your clients’ dealings, anticipate any needs they might have and then meet with your clients to see if you can open a new matter. The relationship has already been built so you will have an easier time capturing new matters from existing clients than you will with another company or person. It may sound banal or obvious, but this is usually the easiest way to bring in new business and the firm will appreciate your initiative and they will certainly appreciate the extra dollars you are generating.
A second method is bringing in new clients. Securing clients is much like dating. You probably won’t have much success if you pick up the phone and cold call your way through the yellow pages (in either scenario really). Capture the attention of a client through a mutual acquaintance. If you have a friend or former colleague that works for a potential client, reach out to them and ask them to make a “warm” introduction. It’s an investment to build a relationship, so once you establish one, make sure to keep it fresh. This is where it helps to keep up your network, so don’t think that you can slack on making connections once you make partner, it’s even more important at this time in your career.
If you do not have any referral sources, make them. Join clubs, groups and associations that your potential clients frequent. These can be trade associations, social clubs, country clubs, gyms etc. Get to know the people there, but do not be forceful, you don’t want to be known as the Annie Wilkes of law. Good places to start are the California Club in Los Angeles and the Union League Club in New York.
4. Success From Within: Connections should not be forged solely outside your firm; your workplace can be a great resource for connections. Seek out lawyers in similar practices and you may be able to source additional work should the client’s needs be more suited towards your expertise. Cross sell! Cross sell! Cross sell! Furthermore align yourself with successful group heads and get to know them. If you consistently show management that you are a hard worker and have a positive presence in the office, they will be more inclined to reward you when the time is right.
Whether you are an associate, partner, or counsel, the firm is (hopefully) benefiting from your services and as you accrue more experience and business, your value grows. This is obvious enough, but many attorneys undervalue their skills or become complacent over time. The reality is if you are a partner and your salary has not changed much over the past 10 years, you are making only 3/4 of what you were back in 2004. Make sure your salary is adjusted not only for inflation, but also for your market value.
5. Don’t Sink The Ship: Look no further than the breakup of Dewey & LeBoeuf for the epitome of this principle. If you negotiate a salary that is disproportionate to your value (or more likely you over promise and under deliver), your bloated salary will stick out and you could find yourself in a worse position than where you started. When you negotiate a salary with your current or prospective firm, make sure you keep your long-term practice in mind. A large salary is enticing, but if you are terminated and lose clients, you will likely wind up with less overall than your previous market value.
If you are having trouble with salary negotiations or feel that your skill set is underappreciated, give me a call and I can help you determine your true market value as a starting point.