Law Firm Updates: COVID-19’s Impact on the Business of Law

Topics: Business Development & Marketing Blog Posts, Client Relations, Compensation, COVID-19, Law Firm Profitability, Law Firms, Midsize Law Firms Blog Posts, Risk Management, Talent Development

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As the COVID-19 pandemic continues to hamper the economy and up-end business as usual, many law firms are grappling with the big questions of how to move forward, promote sustainability, and continue to service their clients.

Thomson Reuters Legal Executive Institute will continue to focus on these critical issues. To that end, we are providing these ongoing updates as to how law firms are dealing with the new normal and what the business of law will look like going forward.

Check back for more updates soon:

May 27 — Troutman Sanders and Pepper Hamilton, two of the largest U.S. law firms, which plan to merge July 1, on Friday both announced they are postponing the start date for their incoming associate class until January 2021.

May 27 — Law firms across the United States have announced measures aimed at conserving cash or otherwise mitigating the fallout of the coronavirus crisis, which has since March led to courts and businesses shuttering nationwide, leaving firms’ financial futures uncertain.

May 22 — Dorsey & Whitney is reducing billable hour guidelines for associates and “certain other attorneys” as it implements sweeping cost-cutting measures and some layoffs to mitigate the economic impact of the coronavirus pandemic, the firm said in a statement.

May 21  Pond Lehocky Giordano, a Philadelphia-based workers’ compensation law firm, is laying off more than 25% of its employees amid the coronavirus pandemic.

May 21 Demand for legal services dropped a median of about 5% in April, according to a recent survey of nearly 60 law firms, including some of the largest in the U.S., as the coronavirus pandemic shuttered courts and businesses nationwide.

May 15 Layoffs are top of mind for many associates, as law firms announce cost-cutting measures in response to the coronavirus pandemic, according to the results of a survey from legal recruiting firm Major, Lindsey & Africa.

May 15 Ropes & Gray said it is offering voluntary buyouts to its U.S. support staff, the latest law firm to take cost cutting steps amid the coronavirus pandemic.

May 15 — Perkins Coie and Faegre Drinker Biddle & Reath are cutting pay by 15% for non-partner attorneys, following earlier announced changes to partner compensation, as the coronavirus pandemic leads many large law firms to conserve cash.

May 8 — The U.S. legal industry cut 64,000 jobs in April, dropping approximately 5.5% to 1,097,600 jobs, a nearly 20-year low, according to a report released by the U.S. Department of Labor, as the coronavirus pandemic batters the nation’s economy and sparks layoffs at law firms.

May 8 — A 62-year-old former IT manager sued Shearman & Sterling, accusing the law firm of firing him because of his age to reduce costs during the coronavirus pandemic.

May 6 — Nixon Peabody said it has canceled its summer associate program due to the coronavirus pandemic, without promising job offers for the second-year students who were slated to take part in the program.

May 5 — Latham & Watkins said it will conduct its summer associate program remotely, making it one of the latest, and largest, law firms to change summer plans due to the coronavirus pandemic.

May 1 — New York’s chief judge has approved a program that will temporarily allow qualified law graduates to engage in the limited practice of law before they pass the bar exam, in part a response to concerns raised by students over the state’s delay of the test due to the coronavirus pandemic.

May 1 — More law firms announced measures aimed at cutting costs or otherwise mitigating the fallout of the coronavirus crisis, with Squire Patton Boggs canceling its 2020 summer associate program and Katten Muchin Rosenman saying it will cut pay for its lawyers and furlough some employees.

April 29 — Shearman & Sterling, Baker Botts and Akerman are among the latest law firms to announce measures to cut costs, such as offering employees voluntary leaves or cutting pay, in an attempt to mitigate the economic impact of the coronavirus pandemic.

April 29 — Littler Mendelson said it had cut pay firmwide and made changes to its summer associate program, as did Davis Wright Tremaine, which also said it would furlough staff as the economic impact of the coronavirus pandemic has decreased demand for some of its practice groups and slowed collections.

April 22Law firms across the United States have announced measures aimed at conserving cash or otherwise mitigating the fallout of the coronavirus crisis, which has since March led to courts and businesses shuttering nationwide, leaving firms’ financial futures uncertain.

April 22 — Legal departments are cutting costs in an attempt to mitigate the economic fallout of the coronavirus pandemic, such as renegotiating agreements with law firms or asking for discounts, according to data from procurement trade organization Buying Legal Council.

April 20Seyfarth Shaw said it had furloughed 10% of its employees in the United States, including some attorneys, and that it is cutting pay across the firm and delaying its first-year associate start date to conserve cash amid the coronavirus pandemic.

April 20 — More law firms announced cost-cutting moves due to the coronavirus pandemic, with Ogletree, Deakins, Nash, Smoak & Stewart and Greenberg Traurig eliminating their summer associate programs and Crowell & Moring reducing pay for all of its attorneys and some staff, among other firms taking steps to conserve cash.

April 15 — Ballard Spahr and Kelley Drye are cutting compensation to conserve cash amid the coronavirus pandemic, the law firms said on Tuesday, the latest in a long list of firms to do so.

April 13 — As the coronavirus crisis shutters courts and businesses nationwide, law firms and companies across the U.S. are seeking ways to conserve cash or access credit, leading some of them to turn to litigation funders, said Stuart Grant, the co-founder and managing director of Bench Walk Advisors.

April 9 — Dentons, Day Pitney and Buchanan Ingersoll & Rooney announced they are delaying or cutting pay, the latest law firms to take steps to conserve cash due to the coronavirus pandemic.

April 8 — Freshfields Bruckhaus Deringer, Blank Rome and Brown Rudnick are the latest law firms to take steps to conserve cash as the coronavirus pandemic brings economic uncertainty.

April 3 — More law firms are cutting pay to conserve cash as the coronavirus crisis hits revenue, with Venable, Clark Hill and Downey Brand announcing such measures.

April 3More law firms are cutting pay or headcount as a result of the coronavirus crisis, which has in recent weeks forced many firms to face hard choices on how to conserve cash as the pandemic wreaks havoc across the United States.

April 1 — Cadwalader, Wickersham & Taft is pausing partner pay and temporarily cutting compensation for associates and other employees by up to 25% in an effort to reduce costs without layoffs as it grapples with the economic fallout of the coronavirus crisis.