Cravath Senior Associate Salaries Top Milbank, Test Rivals (2)

Cravath, Swaine & Moore is raising associate pay across the board, becoming the first law firm to exceed the salary scale announced by Milbank LLP earlier this month for its senior associates.

Cravath associates will be paid on a seniority based scale that now ranges from a base salary of $225,000 to $420,000, according to a firm memo posted by Above The Law. The firm is also handing out annual bonuses ranging up to $105,000 for its most senior associates, according to the memo.

Two other firms quickly confirmed they are matching the new salary scale and bonuses: Paul Hastings and McDermott Will & Emery.

Cravath increased base salaries by $10,000 for its first three classes of associates, matching a surprise move by Milbank to boost salaries for junior lawyers. Cravath—and the firms that have followed with similar announcements—up salaries by $20,000 for more senior associates, doubling the Milbank rate.

Cravath declined to comment.

Although many Big Law firms have been forced to cut costs amid slowing demand, Milbank Chairman Scott Edelman cited “high levels of activity” for the salary bump in a Nov. 7 firm memo.

Major law firms firms historically have moved in lockstep with associate compensation. Cravath’s decision to exceed Milbank’s salary move is likely to cause a domino effect of pay raises for associates. It also puts some firms in a difficult spot as they decide whether to keep up.

Cravath also announced that its annual bonuses for associates will be on the same scale used by top firms in each of the last two years. Milbank announced that it also will use the same bonus scale when it rolled out the salary increases.

Cravath’s bonuses will be paid out on Friday, December 15 and will not be determined by billable hours, according to the memo.