Merit-based pay does not seem to have caught on

Here is an interesting article about associate compensation. The article asks why merit-based compensation hasn’t caught on as a trend after a number of firms – including DLA Piper and Orrick, Herrington & Sutcliffe - abandoned the lockstep model and took up merit-based systems in 2009. A number of reasons are advanced: partners worry that a merit-based system would hamper associate recruiting, dampen morale and create too much paperwork. Another reason is simple inertia, with firms reluctant to overhaul their entire compensation structure. This year, a survey of 86 firms was conducted by an affiliate of job placement firm Lateral Link. The survey showed that about 63 per cent of major law firms use a lockstep system, with the remaining 37 per cent using either a merit-based system or a hybrid of lockstep and merit-based pay.

Merit-based pay does not seem to have caught on newsandinsight.thomsonreuters.com Mon, May 23, 2011