Base Salaries Up for In-House Lawyers, Bonuses Mixed According to 2006 Compensation Survey

New Providence, NJ & Newtown Square, PA, October 31, 2006 – The 2006 Altman Weil Law Department Compensation Benchmarking Survey of U.S. corporate law departments has just been released. The survey, published in partnership with LexisNexis® Martindale-Hubbell®, shows base salaries up across the board for in-house lawyers in 2006.

"Corporations have two tools to set in-house cash compensation – guaranteed base salary and at-risk, performance-based bonus dollars," noted Altman Weil principal James S. Wilber. "Each year we see a balancing act between these two components. Last year, salaries rose slightly, augmented by big bonuses. This year, we're seeing bigger salary increases reflecting greater corporate confidence, along with a mixed bag of bonus levels which seem designed to catch up some of the more junior in-house positions that were overlooked in past years."

"Increased mobility between law firms and law departments forces corporations to compensate more competitively in the war for talent, especially at the senior level," remarked Barry Solomon, Esq., Vice President and General Manager of LexisNexis Martindale-Hubbell. "As a result, corporations will reward their top law department officers first, and only later adjust compensation for junior managers and staff lawyers."

Base Salaries Rise
Median salaries for all positions in law departments increased between 2.2% and 9.5% in 2006. Chief Legal Officer (CLO) salaries were up 8% and Division General Counsel (mid-level management lawyers) took home 7.1% more. Lawyers in non-management positions also saw increases, with High Level Specialists up 9.5%, Senior Attorneys (non-managers with eight or more years experience) up 8.5% and Staff Attorneys (attorneys with at least one year of experience) reporting an increase of 3.5%. Recent graduates reported a modest 2.2% raise.

All trend comparisons are drawn from a super-group of over 200 law departments that have participated in the survey over sequential years.

The survey reports national median salary for Chief Legal Officers in 2006 at $280,000. The Senior Attorney position drew $140,000, while a new law school graduate earned a starting salary of $65,000.

Bonuses a Mixed Bag
Bonuses were up across the board for non-management positions in law departments – in some instances dramatically. Senior Attorneys reported bonus increases of 14.4% while more junior Attorneys and Staff Attorneys received bonus increases of 62.5% and 71% respectively. In the management ranks, Division General Counsel bonuses went up 20.29% and Managing Attorneys 25.32%. Chief Legal Officers and their Deputies received bonuses that were down from the prior year.

The national median bonus for Chief Legal Officers was $132,000, according to the Survey. Division General Counsel received $104,000 in bonus dollars, and Senior Attorneys took home a $29,200 bonus.

Stock Options
Stock options for Chief Legal Officers had a median fair market value of $919,400 in 2006, more than twice the same groups' total cash compensation. Deputy CLOs received $230,100 in stock options, Senior Attorneys $87,900 in options, and Staff Attorneys $24,700.

Other Variables Affect Compensation
Size of law department is a key factor in the top officer compensation. Chief Legal Officers in departments with over 25 lawyers took home 88.9% more than the national median in total cash compensation. Deputy CLOs in large law departments earned 57.5% more than the national median.

The survey reveals a significant difference in CLO compensation by industry. Median total cash compensation for CLOs in the Information / Telecommunications sector was 75% more that their colleagues in the Service sector and 39.9% more in total cash compensation than their peers nationally.

In non-management positions, practice specialty is also a significant differentiator. High Level Specialists with a Mergers & Acquisitions specialty earn top dollar, 23.8% more than the national median in total cash compensation. For Senior Attorneys and Attorneys (with four-plus years experience), a Patents specialty is the most lucrative, at 22% and 33% above the national norms, respectively.

Survey Methodology
The complete Law Department Compensation Benchmarking Survey, 2006 edition contains data from 277 law departments providing compensation data for 6,255 lawyers. Information on an additional 41 one-lawyer departments is included separately.

The Survey reports data on nine in-house positions: Chief Legal Officer, Deputy Chief Legal Officer, Division General Counsel, Managing Attorney, High Level Specialist, Senior Attorney, Attorney, Staff Attorney and recent law school graduate. Data are analyzed by industry, company size (revenue and employees), law department size, region, metropolitan area, years of experience and other key parameters. Data are reported as of March 1, 2006.

Compensation trend analyses, that compare 2006 survey results to 2005 survey results, utilize a unique subset of participants. Only companies with data submissions in both years are analyzed to determine the percentage change between years.