By Meghan Tribe, Reporter
Published: June 14, 2023, 8:59 AM; Updated: June 14, 2023, 11:07 AM
Reed Smith laying off 20 staff, 30 lawyers
Decision follows cuts at other Big Law firms
Reed Smith is laying off roughly 50 lawyers and staff, adding to a growing list of law firms trimming headcount during a demand slowdown.
The cuts, announced internally on Friday, amount to a “less than 2%" reduction of the workforce, the Pittsburgh-founded firm said in a statement. The American Lawyer reported that Reed Smith’s cut amounts to 20 staff members and 30 lawyers.
The layoffs are surprising because firms previously trimming jobs focused heavily on the tech industry or had hired considerably through the end of 2021, said Jennifer Henderson, partner and co-founder of legal recruitment firm Hatch Henderson Fivel. The layoffs show “the powers sits with law firms now, and not with associates,” she said.
The mounting number of Big Law layoffs also include the 40 associates and 50 staff members announced Tuesday by Orrick Herrington & Sutcliffe, or roughly 6% of the firm’s global workforce. Dechert laid off 55 lawyers and 43 professional staff members last month, while Davis Wright Tremaine laid off 21 staff employees in February.
Gunderson Dettmer, the Silicon Valley-based law firm that advises startups and venture capitalists, said in April it would let go of 10% of its attorneys, paralegals and staff. Cooley, one of Big Law’s top hirers during the pandemic, announced late last year it would be laying off 150 attorneys and staff across its US offices.
“These decisions are in response to a reduced level of demand for legal services across the industry,” Reed Smith’s statement said. They are “in line with the continual goal of best positioning our firm to meet its commitment to excellent client service while prudently managing our business.”
Reed Smith is providing laid-off employees with severance benefits and outplacement services, the firm said.
‘Not the Last’
Firms that overhired or that are seeing a significant slowdown in demand are letting people go, said Kate Reder Sheikh, a California legal recruiter for Major, Lindsey & Africa. “These are probably not the last reductions in force that we’re going to see,” she said.
Law firms weren’t letting attorneys go in 2021 and through most of 2022 because of the frenzied demand for talent, Reder Sheikh said. That, combined with the fact that fewer people are leaving, have left firms with “bloated payrolls,” she said.
The operations are cutting back on senior lawyers without a book of business or who are not on track to make partner along with more junior associates, Reder Sheikh said.
There are many more associates on the market than there are roles for the junior lawyers to take advantage of, Henderson said. Firms are no longer in a war for talent, freeing them to figure out what is best economically, she said.
“I understand being an associate in that position—it probably doesn’t feel great,” Henderson said. “However, it’s a smart move by firms to try to ensure that when associates are coming to the firm that they have work to do.”
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