Salary Negotiation Basics Law Firm Associates

Q: Last week I responded to ad in the local legal newspaper that was placed by a small three-attorney insurance defense firm. I was called in for an interview the next day, and was given an offer at the end of the interview. I have been looking for a law firm position for five months, so I was initially thrilled and relieved. But some friends suggested this firm is moving too fast. They have asked me to make a decision in the next 48 hours, and would want me to start immediately. My friends also say that the salary seems too low. I really need a job, but I am beginning to wonder whether something is wrong with this firm. Any ideas what I can do given that I have so little time?

Your questions raises an important and under appreciated aspect of the job search process.

Your bargaining power is strongest after you get an offer and before you decide to accept it. This is the time to ask the firm some penetrating questions and to demonstrate some of the skills and traits the firm would want you to use on behalf of their clients.

Based on what you wrote, the way this firm has handled the hiring process raises red flags that you need to address. This is not to say that you should turn down this offer. That is ultimately your decision and yours alone. But your friends are right to suggest that serious, fundamental problems might be involved when an employer is too anxious to hire someone. It’s a little like going to a restaurant on a Saturday night or other time when the restaurant should be busy. If the restaurant owner does somersaults and handstands when you walk through the front door, this might be a bad sign. Good customer service is one thing, but your arrival shouldn’t be treated as rare event, like the return of Haley’s Comet.

Fortunately, there are few things you can do and questions you can ask that might quickly shed light on the law firm and its offer. The following is a non-exclusive list of questions and topics you might want to address before you decide how to proceed.

Follow the money. When dealing with a firm that predominantly charges by the hour, it is extremely helpful to know their approximate billable rates. This information not only allows you to compare your salary to the amount of revenue you generate on an annual basis, it also gives you a quick and dirty sense of the financial standing of the firm. Is your annual salary approximately one-third of the annual revenues you would be expected to generate? If it isn’t, that might be a sign your salary is too low. This is obviously just a benchmark, but it is not crazy to assume that a defense-oriented firm that charges by the hour will pay its associates a third, pay another third towards benefits and overhead, and will keep a third as profit.

Follow the people. The single biggest red flag suggested by the firm’s behavior relates to people. Specifically, why are they in such a rush? What happened to the last person, if any, who held that job? There might be perfectly good reasons that shouldn’t alarm you. For example, are they super busy because they were just retained to handle a new, large case?

One way to track this down is to search the local legal newspaper for information about the firm. In addition, run the firm’s name and the name of every individual lawyer through Google. Sometimes this search reveals news items that might help you. For example, a client of mine ran this search and uncovered more than a dozen lawyers who had been affiliated with a small firm in the prior three years. Some of the firm’s attorneys spoke at seminars or were listed in press releases the firm had previously issued. I obviously don’t know what you will uncover, but if you uncover something similar, consider calling one of these departed individuals, especially if they were not a partner. Alternatively, you might contact the person who offered you the position with the firm, and ask him or her to address your concerns.

One of the more common reasons firms have revolving doors and need associates quickly is that they have a fundamental problem they don’t address. The problem might be a misbehaving partner, or substandard work conditions, to name a few. This kind of information can be hard to find out especially if you are limited by time. But there are at least two kinds of searches you can do quickly. First, contact the state bar, and find out whether the firm or its attorneys have disciplinary issues. In many states this information is available online to members of the public. Second, find out if the firm or its lawyers have been sanctioned. If you have access to Westlaw or some legal research tool, the following search might uncover this:

(AT(insert name of firm and/or individual attorney) & rule 11 sanction! discipline

On more than one occasion, I have seen this candidates uncover important information using this or a similar search.

Follow your instincts. Jeff, you have to deal with the consequences of your decision. You met with them and saw their offices. I didn’t. You are in the best position to figure out whether you trust or like them. Ultimately, it might be entirely justifiable to accept their offer even if your due diligence confirms some of your worst suspicions.

Too often, lawyers don’t take advantage of the bargaining power they have. I know many candidates fear that their offers will be withdrawn if they ask some of the difficult questions I’ve identified above. And only you can judge how these questions might be received. But lawyers often have more latitude than other job seekers to ask hard questions. After all, the firm wouldn’t want you to cave in to an aggressive opposing counsel. So please strongly consider demonstrating that you possess the skills of a good attorney. For example, if you need more time, consider asking for an additional day or two to get back to them, (especially if this wouldn’t delay your start date). Moreover, how the firm responds to your questions might tell you all you need to know about whether you should accept their offer.