Thoughts about Quinn Emanuel's new (additional) Associate Bonus Pool? Forum

[njkga]

Read more about it at AtL, but apparently Quinn Emanuel is creating a new associate bonus pool that is based on a percentage of firm profits. (In addition to the regular earned bonuses they already have.) Catch being - you must stay for an additional three years after the year in which the bonus is earned in order to receive the money.

http://abovethelaw.com/2017/08/associat ... onus-pool/

Thoughts?

[lolwat]

Knowing Quinn's reputation, it might be one of those things that they "need" to do for associate retention, but then again, for those who do stay, it might be pretty nice. It's a unique way for a big firm to make associates feel like they've got some skin in the game (while making sure they stick around to earn more money for the firm) rather than just there to collect a set biweekly/monthly/whatever paycheck and a relatively set bonus at EOY. You'll find tons of big firms that will match Cravath's set salary and bonus scale, and some that will go over or under that, but big firms rarely share profits with anybody other than equity partners.

[jd20132013]

My only thought is imagine how shitty it must be to work there that they have to do this

[Spot]

Alternately Quinn could stop being so stingy with normal bonuses and then it wouldn't be so hard for them to retain people for three years.

[UVA2B]

I don't pretend to understand internal firm politics, but the structure of these bonuses seems to be geared toward handcuffing people in the transition from junior to mid-level associates.

Am I missing something there?

[Hutz_and_Goodman]

This is a TTT bonus structure. How is anyone supposed to get amped about a bonus that they have earned in, say, August 2017 that they cannot collect until August 2020? Also the announcement mentions you don't get the bonus if you resign during the three year period. What if they lay you off? Quinn makes so much money, honestly this is a slap in the face to associates. The firm makes more $ by being able to retain someone for 3 years (and not having to conduct searches) than the bonus itself is likely to be.

[UVA2B]

This is a TTT bonus structure. How is anyone supposed to get amped about a bonus that they have earned in, say, August 2017 that they cannot collect until August 2020? Also the announcement mentions you don't get the bonus if you resign during the three year period. What if they lay you off? Quinn makes so much money, honestly this is a slap in the face to associates. The firm makes more $ by being able to retain someone for 3 years (and not having to conduct searches) than the bonus itself is likely to be.

Not to refute anything you said, but this bonus is at least in addition to regular bonuses. Quinn is at least feigning an interest in paying big bonuses, on top of their normal bonuses for meeting hours, so it's not entirely TTT. But yeah, it does feel that way functionally.

[njkga]

This is a TTT bonus structure. How is anyone supposed to get amped about a bonus that they have earned in, say, August 2017 that they cannot collect until August 2020? Also the announcement mentions you don't get the bonus if you resign during the three year period. What if they lay you off? Quinn makes so much money, honestly this is a slap in the face to associates. The firm makes more $ by being able to retain someone for 3 years (and not having to conduct searches) than the bonus itself is likely to be.

I believe the article mentions (or the memo mentions.... or I'm imagining it) that if you get fired without cause, you still get the bonus. Fired FOR cause, I think no.

[Magic Hat]

This is a TTT bonus structure. How is anyone supposed to get amped about a bonus that they have earned in, say, August 2017 that they cannot collect until August 2020? Also the announcement mentions you don't get the bonus if you resign during the three year period. What if they lay you off? Quinn makes so much money, honestly this is a slap in the face to associates. The firm makes more $ by being able to retain someone for 3 years (and not having to conduct searches) than the bonus itself is likely to be.

I believe the article mentions (or the memo mentions.... or I'm imagining it) that if you get fired without cause, you still get the bonus. Fired FOR cause, I think no.

Yet almost nobody is fired. They are instead given the opportunity to resign.

[BlueParrot]

If you get pushed out, which I assume even Quinn does rather than simply firing people, you won't get your bonus for the most recent years.

Also, my math could definitely be off, but I think this additional bonus would be something in the range of 10-20% of the traditional bonuses depending on how they split the bonus among class years. For the most senior associates that could mean in the range $20,000 a year, but since you have to stick around 3 years to collect you would be likely be partner by the time you qualify for it.

It can only help associates, so Quinn deserves praise for taking any steps to share the wealth. If I was deciding on whether to go to Quinn though vs another firm though, this wouldn't change anything. The vast majority of associates will only ever get to collect on this supplemental bonus from their first couple of years at the firm, as most will be gone by years 5 or 6.

Edit: This is BlueParrot, accidental anon post.

[dixiecupdrinking]

Seems like it will work out really nicely for a few people though it's definitely not suddenly a reason to go to Quinn. What I'd like to know: if they dedicate 1 percent of profits to the pool, and then a bunch of people leave before it vests, do those associates' pro rata portions of the pool revert to the partners, or do the eligible remaining associates get bigger shares?

Maybe a minor detail, but if the partners get the money back this could end up creating even more of an up or out structure. The favored associates get the retention bonuses the mediocre associates get the boot before the partners have to pay them a big chunk of change.

[Pokemon]

Seems like it will work out really nicely for a few people though it's definitely not suddenly a reason to go to Quinn. What I'd like to know: if they dedicate 1 percent of profits to the pool, and then a bunch of people leave before it vests, do those associates' pro rata portions of the pool revert to the partners, or do the eligible remaining associates get bigger shares?

Maybe a minor detail, but if the partners get the money back this could end up creating even more of an up or out structure. The favored associates get the retention bonuses the mediocre associates get the boot before the partners have to pay them a big chunk of change.

That was my initial thought and that is why I thought it was bad, but If they are calling it a pool then I imagine it has to stay with the associates. Otherwise on any recession/market decline the temptation would be there to pillage bonus pool by firing associates that are close to getting it.

[Monochromatic Oeuvre]

1% of their profits are set aside for this? So, like $15k per associate that only fifth years and above (less than 20% of an incoming class traditionally) will ever see?

So this TTT shithole, which already withholds bonuses until 2100 hours plus a non-credited "marketing project" while, mind you, its partners make $5M/a year, is hoping to entice people who are or will be fifth-years and above making $340k to stay by dangling $15k (if everyone stays like they hope!) to stay at that gulag?

Because I think that in spite of what they consider "generosity," I'd still rather drag my balls on a bed of rusty nails in a Honduran septic tank than work at Quinn.

[Pokemon]

damn, had heard Quinn was bad but had no clue it was that bad.

[rahulg91]

Because I think that in spite of what they consider "generosity," I'd still rather drag my balls on a bed of rusty nails in a Honduran septic tank than work at Quinn.

[Sacred Cow]

This is needlessly convoluted. If you want to attract people, just pay bigger bonuses. Boies/Kirkland/Kellogg/Susman etc. etc. don't seem too concerned about retention. More money is more money, but waiting three years for a bonus to vest would irritate me when the firm makes as much money as they do and already has that marketing requirement for market-trailing associate bonuses that their peers don't. Maybe my opinion on this would change if the additional bonus was substantial (read: six figures), but there's no point in having it at all if it's in the ballpark of the figures estimated ITT.

[Anonymous User]

Has anyone figured out the math on this to a reasonable degree of certainty (i.e. how much $ per year per associate it is likely to amount to)?

This could be wrong, but my best guess is:

162 equity partners x 5M (QE's ppp) x 0.01 (percentage of profits designated for pool) % 400 (estimated number of qualifying associates) = $20,250

This assumes (i) "1 percent of profits" means 1 percent of profits per equity partner and (ii) about four-fifths of QE's approx. 500 non-partner "attorneys" would qualify. That last assumption could be wrong if "attorneys" includes non-qualifying contract attorneys or some large number of non-2nd-through-6th-year associates (though I assume most of the associates are in their 2nd-through-6th years).

Also unclear on whether the pool is divided evenly among all qualifying associates or rather distributed on the basis of seniority, performance, etc.

[Anonymous User]

Has anyone figured out the math on this to a reasonable degree of certainty (i.e. how much $ per year per associate it is likely to amount to)?

This could be wrong, but my best guess is:

162 equity partners x 5M (QE's ppp) x 0.01 (percentage of profits designated for pool) % 400 (estimated number of qualifying associates) = $20,250

This assumes (i) "1 percent of profits" means 1 percent of profits per equity partner and (ii) about four-fifths of QE's approx. 500 non-partner "attorneys" would qualify. That last assumption could be wrong if "attorneys" includes non-qualifying contract attorneys or some large number of non-2nd-through-6th-year associates (though I assume most of the associates are in their 2nd-through-6th years).

Also unclear on whether the pool is divided evenly among all qualifying associates or rather distributed on the basis of seniority, performance, etc.

(1) Would any Quinn associates who have received provisional awards be willing to share the amount?

(2) Has anyone figured out whether provisional awards are set in stone or rather capable of increasing when other associates quit before vesting?

[Anonymous User]

$43k and change.