Ups and Downs for In-house Compensation in 2002, New Survey Reports
(Newtown Square, PA, November 12, 2002) – The 2003 Altman Weil Law Department Compensation Benchmarking Survey of U.S. corporate law departments has just been released. The Survey, published in partnership with the American Corporate Counsel Association (ACCA), shows decreases in salaries, significant increases in bonuses, and slight increases in total cash compensation for in-house attorneys in 2002. Stock options added substantially to compensation packages for some in-house attorneys.
“In 2002 we’re seeing a return to a more traditional buyer’s market for legal services,” remarks Altman Weil principal Jim Wilber. “With the economy slumping and the dot-com bubble burst, in-house departments are no longer competing for talent the way they were just a few years ago.”
Salaries Down in 2002
With the exception of Chief Legal Officer (CLO) salaries, which remained virtually unchanged, salaries for in-house counsel were down across the board in 2002. The Survey reports salaries for Deputy CLOs down 3.7%, for Division CLOs down 1.4%, and for Managing Attorneys down 4.6%. Young attorneys were hit hardest, with Staff Attorney salaries down 10.5% and recent grads earning 9% less than the previous year.
The Survey reports national average salary for Chief Legal Officers in 2002 at $267,500. The mid-level Managing Attorney position drew an average $151,800, while a Staff Attorney (entry level with at least one year of experience) earned $63,000 on average nationally.
Bonuses Jump
In contrast to dipping salaries, cash bonuses were up significantly. Chief Legal Officers received an average $160,700 in bonus cash nationally, up 8.9% from 2001. Deputy CLOs saw an average 19.2% increase to $110,400; and Division CLOs earned 12.7% more in bonus dollars, collecting an average $84,400 in 2002.
“Over the past few years, many corporations have revamped their pay strategies,” comments Wilber, “putting more compensation in the bonus or ‘at-risk’ category.”
Stock Options Can Be Worth Five Times Salary
Stock options received by in-house attorneys can be worth up to five times salary, the Survey reports. In 2002, the national average fair market value of stock options received by Chief Legal Officers was $1,338,900. 76.3% of CLOs were eligible for stock options according to the Survey.
Deputy CLOs received options worth an average $1,000,300, Division CLOs’ options averaged $679,800 in value, and Managing Attorneys $266,300. While attorneys at all levels in law departments may be eligible for stock options, the Survey reports those in more senior positions are more likely to receive them.
Regional Data Varies
New York: Top in-house lawyers in the New York City / Northern NJ / Long Island area earn 76.6% more in total cash compensation than the national average, while salaries for other in-house positions in the same region exceed national averages by 13%-55%.
San Francisco: Total cash compensation for CLOs in the metropolitan San Francisco / Oakland / San Jose area is 18.9% below the national average in 2002, compared to 6.6% above average last year.
Other metropolitan areas: In the Houston / Galveston / Brazoria metropolitan area, total cash compensation for CLOs is 36.3% above the national average. In the Los Angeles / Riverside / Orange County area CLO compensation is 1.1% above average; and in the Chicago / Gary / Kenosha area, it is 9.8% below.
Survey Methodology
The complete 2003 Altman Weil Law Department Compensation Benchmarking Survey contains data from 324 law departments providing compensation data for 7,062 lawyers. Information on an additional 80 one-lawyer departments is included separately.
The Survey reports data on nine in-house positions: chief legal officer, deputy chief legal officer, division or group chief legal officer, managing attorney, high level specialist, senior attorney, attorney, staff attorney and recent law school graduate. Data is analyzed by industry, company size, law department size, region, years of experience and other key parameters. Data is reported as of May 1, 2002.
The Survey is available from Altman Weil Publications for $625. Altman Weil Publications conducts and publishes numerous surveys of the legal profession including the Law Department Performance Metrics Survey, the Survey of Law Firm Economics, and the Survey of Compensation Systems in Private Law Firms. For additional information visit the Altman Weil website at www.altmanweil.com.
