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Law360 (March 31, 2020, 11:42 AM EDT ) Cadwalader Wickersham & Taft LLP's leadership announced Tuesday that the law firm is pausing partner compensation distributions and reducing associate and senior administrative staff pay by 25% in response to the economic uncertainty surrounding the COVID-19 pandemic.
Economic downturn caused by the novel coronavirus has led Cadwalader and other law firms to make changes to their staffing and employee compensation. (AP)
"The longer we wait to take action in response to the virus, the more difficult it will be for us to avoid much more drastic measures later on," the letter said. "As a result, we must take a number of necessary steps at this time for the collective good and to ensure that we come out the other side on very sound footing."
In addition to the delays in partner and senior counsel distributions and 25% pay reduction for legal staff and senior staff earning more than $100,000 a year, Quinn said that non-senior administrative staff will see a 10% reduction in pay. All of the changes are effective Wednesday and salaries will return to normal "as soon as circumstances permit," he said.
"We know this is a big sacrifice. You should know that everyone at Cadwalader is being asked to sacrifice to achieve our goals of preserving the jobs of our colleagues and friends and ensuring that the firm rebounds from the crisis strong and poised to get back to normal," Quinn said.
In a call with Law360, Quinn said he and his fellow leaders at Cadwalader believe the economic downturn associated with the coronavirus is different from other downturns and recessions in that it is a health crisis and was not created as a result of a financial collapse.
Because of that, he said, the firm wants to "keep the team together" and be ready to ramp back up again when business is back to normal.
"We are very confident there will be an end to this crisis and there will be a time in the near future where we'll be all hands on deck and servicing clients' needs the way we always have," he said.
On Monday, another law firm announced measures aimed at proactively addressing the coronavirus crisis, while avoiding layoffs. Reed Smith announced that its leadership will slow partner cash distributions in the near term.
Also on Monday, Marshall Dennehey Warner Coleman & Goggin CEO G. Mark Thompson sent a firmwide email to attorneys and staff announcing that the firm will be suspending its 4% employer match to employee 401(k) contributions from May 1 through the end of the year in response to the economic fallout from the pandemic.
Others announced that they would be adjusting staffing levels as a result of the current situation.
Womble Bond Dickinson on Monday announced it had made the "hard decision" to furlough certain employees and let others go. Remaining staff and attorneys will see their pay cut by up to 10%, according to the firm, though those with lower levels of compensation will see smaller reductions.
Buffalo, New York-based Goldberg Segalla LLP made the decision last week to reduce its workforce, eliminating positions it said would not be necessary in the current environment.
Another New York firm, Belkin Burden Goldman LLP, also announced it would be making "adjustments to support staffing" in order to operate more efficiently, but that it has not laid off any attorneys.
--Additional reporting by Emma Cueto. Editing by Emily Kokoll.
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