What Will In-House Counsel Salaries Look Like in 2011?

Are Salary Freezes and Flat Salary Increases To Continue in 2011? Base salary increases are slowing within in-house legal departments. The average increase in 2010 was 2.6%, compared to about 6% just two years ago. Base salary increases will most likely continue to remain flat in 2011. Legal departments have cut expenses as far as they could, and while they could potentially trim a little more, they have a lot less to work with at this time. The bleeding and heavy cost cutting has already happened, now it's more about maintaining status quo, and trying to keep people on board. There is a sense of resignation and acceptance when it comes to low base salaries and freezes. Counsels have no choice in the matter because no one else is offering anything different, and jobs remain hard to come by. Who Will Most Benefit From Merit-Based Compensation? About 93% of all salary increases are merit-based, which is a huge incentive for in-house counsel to find ways to please their companies. What are some ways to do this? What skills are receiving praise? Are alternative fee arrangements and other cost-cutting measures resulting in salary increases? In-house counsels that benefit from merit-based compensation are those who know how to deal with the changing times, and can demonstrate flexibility, adaptability, and creativity in the workplace. They are what I call the "MacGyver's" of the legal world, counsels who can come up with creative strategies to accomplish their goals with few resources available. In-house counsels that tend to be highly regarded are also those who know how to save their company money, by effectively managing outside counsel fees or resolving ongoing litigation. There are also those who help contribute to the bottom line and generate revenues by mining the company's intellectual property portfolio, or identifying new business opportunities. In short, counsels who do many things with few resources, cut costs, and contribute to revenues are the ones who will benefit from this new incentive-based environment. Despite a push by companies and slow acceptance of alternative fees by law firms, the billable hour still rules, and savings resulting from these cost-cutting measures have not had a major impact on salary increases. Primarily, because the saving from alternative fees have been relatively modest, and second because law departments have been looking to keep costs down and their expenditures flat.

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