Latest Associate Pay Raises Reflect Start of ‘Prestige Law’ Era

On June 2, Milbank announced a new associate pay scale. Raising base salaries by $10,000 to $20,000, depending on seniority, the updated scale starts at $235,000 for first-year associates and tops out at $455,000 for eighth-year associates. Two weeks later, it has been adopted by more than a dozen firms—with more likely to follow.

Associate compensation is most relevant to associates, but this latest salary increase offers everyone a window into the current state of Big Law. Here are some takeaways.

1. Top firms are thriving—and sharing the wealth with their associates.

The most obvious conclusion to draw from the pay hike is that some firms are doing very well for themselves. As Milbank chairman Scott Edelman wrote in his memo announcing the raise, “We have been very busy across the entire firm over the first five months of the year and expect that the high levels of activity will continue for the remainder of the year.”

Milbank saw revenue per lawyer of $2.085 million and profits per equity partner of $7.6 million last year—reflecting 8% and 12% increases, respectively, since 2024.

“The salary increase for associates isn’t because the price of eggs or gas has gone up,” Peter Zeughauser, a partner at the Zeughauser Group consultancy, said in an interview. “Partners are saying to themselves, ‘We’re doing really well—and we should pass some of that along to the people who are helping us make all this money.’”

Big Law associate salaries last went up in 2023. During the intervening three years, compensation for the highest-paid equity partners has skyrocketed—with some earning more than $40 million a year.

“The dramatic increases in what top partners are making are reported in the news and well-known to associates,” Zeughauser said. “Too much disparity is bad for morale. What we’ve seen historically when this has happened, and what we’ve seen just now, is an associate pay increase.”

2. Traditional hierarchies have been upended.

There was a clear pecking order among firms when I first started covering Big Law 20 years ago. The top tier included venerable, white-shoe firms, founded in New York more than a century ago—such as Cravath, Sullivan & Cromwell, and Davis Polk.

Their preeminence showed in a number of ways. They enjoyed the highest profits and greatest prestige (with a handful of younger firms such as Wachtell Lipton and Skadden thrown into the mix). They rarely lost partners to rivals. They paid their associates the most. And they led the way on associate pay raises—with Cravath such a clear market leader that the prevailing Big Law salary scheme was called the “Cravath scale.”

It might be time for the “Milbank scale” to take its place. Over the past decade, Milbank has led all six associate pay raises—in 2016, 2018, 2021, 2022, 2023, and 2026. (Founded in 1866, Milbank has a long and distinguished history, but it’s fair to say it wasn’t seen as in the same league as Cravath until recently.)

The diminishing dominance of old-line New York firms can be seen in other ways as well. Most notably, when it comes to having their partners poached, firms like Cravath are no longer impregnable fortresses.

Cravath itself has lost at least nine partners so far in 2026. Two of them went to Paul Hastings—founded in Los Angeles in 1951, and today a major player in the lateral market.

3. Litigation boutiques are here to stay—and a force to be reckoned with.

Around 15 firms have announced associate raises this month. But only five are among the nation’s 100 highest-grossing law firms: Milbank, McDermott Will & Schulte, Quinn Emanuel, Katten Muchin, and Susman Godfrey.

Most of the rest are elite litigation boutiques, including Hueston Hennigan, Elsberg Baker & Maruri, Wilkinson Stekloff, Desmarais, Kellogg Hansen, and Holwell Shuster & Goldberg. And even though Quinn and Susman are top 100 firms based on revenue, they’re litigation-only rather than full-service firms.

Today, leading boutiques compete with Big Law not only for talent, but also for cases and clients. Chief legal officers and general counsel are increasingly comfortable with sending their most important matters to boutiques—which can make up for their lower headcounts by partnering with larger firms or leveraging the power of technology, including artificial intelligence.

Given the rise of boutiques, I’d like to propose a new term: “Prestige Law.” It would encompass the large firms traditionally known as “Big Law” and the smaller firms that play on the same turf.

4. AI hasn’t killed off demand for associates, and it might be a long-term boon for them.

AI has taken the legal profession by storm over the last few years. Does it make sense for firms to raise associate pay when AI tools can now complete many of the tasks that used to be performed by associates?

“The AI piece hasn’t settled out yet,” Zeughauser said. “We don’t have enough experience yet with the impact of AI to determine how many associates firms need. You see different views on that within Big Law—with some firms shrinking, some expanding, and some staying the same.”

My own view is that the combination of pay raises and AI could be a good thing for associates. If junior associates are increasingly expensive and not immediately profitable because AI tools will do much of they used to do, firms will have more of an incentive to invest in young lawyers.

If an associate leaves their firm after only two or three years, the firm didn’t get a great return on its investment. So firms will want to give their associates positive experiences, encouraging them to stick around to the point of maximum profitability. Firms will also focus more on professional development and training: With AI handling more rote tasks, associates will be expected to do more sophisticated work earlier on in their careers.

Even if firms substantially reduce associate headcount, they’ll need at least some associates for a very long time. For starters, they need tech-savvy associates to operate and supervise AI tools—because when lawyers don’t review AI output, bad things happen.

And partners, whose necessity is undisputed, don’t just show up fully formed, like Athena from the head of Zeus.

“To have partners, you need to have associates, and to have senior and midlevel associates, you need to have junior associates,” said Zeughauser. “So someone has to hire first-years—because you need that pipeline.”

The first-year associates of today are the partners of tomorrow. Or put another way, those $40 million partners were once first-year associates.

David Lat, a lawyer turned writer, publishes Original Jurisdiction. He founded Above the Law and Underneath Their Robes, and is author of the novel “Supreme Ambitions.”

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