For those of a certain age, the phrase “I read it for the articles” will resonate. Well … I was reading Above The Law this week and stumbled on a substantive article (since I read it for the substantive articles) on law schools. It was actually a thoughtful piece on how ABA accrediting standards have locked law schools in to their current model – which everyone seems to agree is broken. The author had been to a conference on the subject and not only did everyone agree, they were offering viable alternative models that unfortunately run counter to the current accrediting model.
One statement particularly stood out to me, “Does any school want to sign up to be the first “second tier” practitioner law school that only gets one year of tuition from would-be lawyers instead of three?" It stood out since I read something similar-sounding from the NY Times Economix blog on lawyer salaries, “Not paying the standard top-tier salary is a tacit admission that you’re no longer top-tier.”
So law firms and law schools are in what appears to be a no-win situation (a.k.a. The Kobayashi Maru). If you are the first firm or law school to embrace a new model, you lose. But if you don't embrace a new model, you still lose. Before you jump to the comments section at the end of this post, let me further explain my thinking.
Now many people feel $160k is outrageous for first-year lawyer salaries. For argument's sake, suppose something like $80k might be a more reasonable number. But imagine a large firm that drops its starting salary to $80k. Even if this firm provides candidates with significant bonus opportunities, an intensive professional development program and no billable hour requirements for the first three years, how many and which graduates will opt for the $80k deal? And remember, these people have $100k in law school loan debt.
Or imagine the firm that tells its partners their comp is being changed to a base salary, performance bonus, and equity reward program. Will partners with sizable books of business sit back and accept that, or are they more likely to jump to another firm and retain their current (known) incomes?
Those who know me know I am a strong voice for change. But seeing these statements brought home the challenge of being the first to change. Yes – eventually these changes will bear fruit for market participants. It’s just that being first may have extreme risk, with only moderate short-term rewards.
And we all know how lawyers love taking risks.