Wall Street law firm Cravath, Swaine & Moore said Monday it is changing how it pays its partners, moving away from a strictly seniority-based compensation system that it has long embraced.
In adopting a so-called modified lockstep system, Cravath is following in the footsteps of other firms, including, that now determine pay according to partners' contributions along with their tenure.
"This decision will advance our strategic objectives so that we can continue to thrive in a dynamic marketplace while maintaining the values and culture – including our ethos of shared success – that define our firm," Faiza Saeed, Cravath's presiding partner, said in a statement.Cravath had been one of lockstep's last remaining adherents among the country's most profitable law firms.
Wachtell, Lipton, Rosen & Katz; Debevoise & Plimpton; and Cleary Gottlieb Steen & Hamilton are among the handful of major firms that maintain lockstep partner compensation. Debevoise said in a statement Monday that it remains “fully committed” to that model. Wachtell and Cleary did not immediately respond to requests for comment.
Compensation for top law firm deal advisors and litigators can run into several million dollars per year. Cravath's profits per equity partner hit $4.576 million in 2020, according to ALM Media, which tracks law firm financial data.
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