Six-figure bonus season arrives for London's US firm associates

Cravath has opened Big Law bonus season in the US, announcing year-end bonuses from $15,000 to $115,000, plus special bonuses up to $25,000.

Several elite US rivals are now rolling out matching announcements, while McDermott and Cadwalader have already confirmed that their London associates will get bonuses equal to those at Cravath - paid in GBP.  

Cravath, typically the standard-setter for associate compensation - and namesake of the "Cravath scale" which sets the standard base salary for Big Law associates in the US - published its year-end bonus memo announcing bonuses up to $140,000 according to an internal memo reported by Above the Law.

Milbank, one of highest paying firms and known for occasionally pre-empting Cravath on compensation, has yet to announce its year-end bonuses. The firm did, however, hand out summer bonuses of up to $25,000 across all associate classes, including London, in August.

Bonus practices vary across the market. Some firms pay associates without linking awards to billable hours simply for being in "good standing", while others require lawyers to meet annual targets that typically start around 1,800 hours.

Some Big Law firms treat the Cravath scale as a standard baseline, layering on top additional bonuses for hitting certain billable hour goals or other performance measures.

London matches roll in

McDermott and Cadwalader have confirmed that their London associates will receive bonuses that match Cravath’s. For senior associates, the combined year end and special bonus can reach $140,000 - equivalent to roughly £107,000 at current exchange rates.

What UK firms do next

Attention now turns to the UK elite firms with growing US practices. Last year, the newly merged A&O Shearman matched Milbank’s year-end and special bonuses, and the market will be watching closely to see whether that happens again.