This year, things have changed. Although we still have a long way to go, the economy is rebounding and both first and second tier law firms are seeing increases in revenue and profits, although most of those increases are in New York and Southern California with things remaining flat across the rest of the country. Some of these profits are due to business picking back up, but a lot are attributable to cost cutting measures - like layoffs, pay freezes and salary cuts. It would have been nice to see this reflected in year end bonuses. Unfortunately, Cravath is once again the trendsetter paying the same bonuses as last year for everyone but the most senior associates. Two firms, Skadden and Milbank, have already fallen in line announcing bonuses equivalent to Cravath's.
Keep in mind that although revenue fell sharply in 2009, thanks to cost cutting measures that were mostly on the backs of associates, per partner profits for the AM Law 100 rose slightly. If it turns out that per partner profits are up again for 2010, the flat bonus rates for associates will be increasingly hard to justify.
It's still early and there's always the chance that some firms will buck the trend, but I'm not holding my breath.
