Constitutional Daily

Founding Principles

The Tenure Paradox - Robot pimp

Slap on the Wrist for "Non-Consensual Sex" - Lampshade, Esq.

Intelligence: The Gathering - Graphic and Gratuitous

Grads are the New Illegals - Robot Pimp

Meet Entitlement Eric - Robot Pimp

Wherein I Solve World Peace - Lampshade, Esq.

A Necessary Delusion - Shadow Hand

Do you even need to shave overhead? - Lawyerlite

LSAT Jenga - Publius Picasso

Time, Place, and Manner

...Should have some links here or something.


The Ten Thousand Dollar Man

E-mail Print PDF

Bender: You guys realize you live in a sewer, right?

Dwayne: Perhaps, but perhaps your civilization is merely the sewer of an even greater society above you!

Leela: No. We're on the top.

Fry: Daylight and everything.


By now if you follow legal employment news you've heard about the full time attorney job in Boston offering just $10,000 annual pay (plus benefits). The job description claims that "Compensation is mainly based on percentage of work billed and collected," and that got this robot thinking, just how much is this associate being billed out for?

The traditional law firm model has been 1/3 of revenues go to associate compensation, 1/3 to overhead, and 1/3 to partner profits. So, if we can figure out total compensation, we ought to be able to figure out the total billable hour rate.

$10,000 is pretty easy to figure out, that's $10,000. The tricky part is the benefits. The job comes with health insurance, malpractice insurance, a clothing allowance, and an MBTA bus pass.

If we assume a middle of the road insurance plan, that's about $200 a month, $2400 a year.

A clothing allowance for an attorney only making $10,000 should be about $150 spent at Men's Warehouse. But, let's be a bit more generous and assume this is going to be a cool $1000. That's a couple decent suits, a pair of shoes, and some shirts and ties.

The bus pass is $59 a month, $708 a year.

As for the malpractice insurance, since you're working full time this isn't really a "benefit." It's not like they're covering your insurance so you can then take other clients on the side, which would have been the case if this were only part-time work. Instead, malpractice insurance properly falls under the firm's overhead, so I'm not putting it in compensation.

This brings us to a total of $14,108 total compensation.

Under the tradition model where compensation is 1/3 of total revenues, the associate would be bringing in $42,324 a year. Now to figure out the billable hour rate.

The standard number for hours billed in a year is 2000. But given the low salary and the fact that compensation is based not on billing but on collections, we're going to go with a much smaller number, 1200 hours.

$35.27 an hour.

That's not the pay rate, that's the billable rate.


Of course, that's probably not the billable rate, not for a law firm in Boston. It's unlikely the associate would be billed out at anything less than $50 an hour, though something like $75 is more plausible.

The 1200 hour mark is also extremely low. This is a full time position after all, and if the firm is smart enough to get retainers from their clients they'll have a decent collection rate. If you're billing 1800 hours and collecting 80% of the time, that's 1440 hours a year.

1440 hours a year at $50 an hour is $72,000.

Associate compensation just dropped to a sad 19.6%.

1440 hours a year at $75 an hour is $108,000, at which point associate compensation is a mere 13.1%.


Fry: That's the last time I visit a planet called Cannibalon.

Bender: Yeah. Food was good, though.

[Read more from The Robot Pimp]

blog comments powered by Disqus

Philadelphia Lawyer, Unfiltered

The finest blend of analysis, advice, and fury on the internet. Sour mash, oak barrel aged, published at cask strength.


Most Recent Article:

In Defense of Risk (Happy Fourth of July)

All Articles from The Philadelphia Lawyer

Author Profile

The Robot Pimp

An in depth look at the emerging intersection of law, behavioral economics, and robots.

Most Recent Article:

The Tenure Paradox

All Articles from The Robot Pimp

Author Profile

Practice Makes Putrid

Legal practice would be all rainbows and buttercups, if it weren't for the clients, and opposing counsel, and co-counsel, and judges, and the law.

Most Recent Article:

Eat Mor Fiv Freedums

All Articles from The Namby Pamby

Author Profile

Gin and Glannon's

As Shadow Hand suffers through law school, the rest of us get a little Schadenfreude.

Most Recent Article:

I Just Work Here

All Articles From Shadow Hand

Author Profile

Irresistible Impulse

Dr. Rob Dobrenski's daring expedition into the psychology of lawyers and the law. (Not a substitute for a life well lived.)

Most Recent Article:

You're Not a Failure, You're a Narcissist

All Articles from Dr. Rob

Author Profile

Graphic and Gratuitous

Sometimes cartoons are the highest form of communication. Those times are known as "most of the time."

Most Recent Cartoons:

Intelligence: The Gathering

All Cartoons

There And Never Back Again

Defunct Big Law attorney BL1Y shares his misadventures as a writer who accidentally went to law school.


Most Recent Article:


All Articles from BL1Y

Author Profile

Lampshade, Esquire

We're dealing with some technical difficulties here. Hold up a minute.

All Articles From Lampshade, Esq.

Staff Infections

News, humor, and other non-billables from our underpaid, uncredited, unsexy staff.


News Articles

Smaller News Bits

Large Numbers of Law

Mixed Bag of Lawesome


Scofflaw Multistate Bar Review