<p>What is the exact definition of it?</p>
<p>:) Thanks.</p>
<p>Some people who use the term are referring to the National Law Journal's annual survey of the nation's 250 largest law firms. The last time I checked, they had a combined total of about 48,000 partners, and 58,000 associates.</p>
<p>They're the firms that generally pay six-figured starting salaries to freshly minted lawyers.</p>
<p>I heard it on the board refering to reasons why an Ivy Law school diploma would be helpful. If you don't mind me asking how, or rather why, do those firms pay six-figured starting salaries to freshly minted lawyers?</p>
<p>Every now and then, an arms race breaks out among big law firms; one of them will bump associate salaries, and the others feel they have to follow suit if they're going to attract the top candidates.</p>
<p>A ten percent increase in first-year associate salaries does not mean, however, that the large corporations who ultimately finance these firms by paying their fees are willing to pay ten percent more for a billable hour from a new associate. The firm has a choice between lower profits, and having young assocites to bill more hours to make up the gap. </p>
<p>At the same time, there's a competition among firms for bragging rights to the title of highest profits per partner. (It's not just a question of bragging rights, of course - it's also a matter of partners with portable books of business happy, and attracting the most ambitious associates, who may use the ranking of per-firm profits to differentiate between firms that pay identical salaries to first-year associates). So higher associate salaries really means that asking associates to bill more hours.</p>
<p>In this market, where those billable hours are harder to come by, that means laying off associates.</p>