Law Firm Articles

Direct Compensation Allocation

How is partner compensation allocated over the year?  How much do other firms have in their year-end distribution?  How much of compensation is represented by benefits and tax draws?  The Altman Weil 2003 Survey of Compensation Systems provides answers to these often asked questions.  This survey of private U.S. law firms examines compensation methodology for partners, associates, paralegals and staff.

A new topic for the 2003 study is how partner compensation is allocated among the components of: salary/draw, benefits, tax draws and year-end profit distribution.  The average for all firms surveyed was reported as follows:

  • 60% of total compensation is paid out in a regular draw or salary.
  • Another 9% is consumed by benefits and tax draws.
  • This leaves 31% to be distributed at year-end.

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