Many attorneys end up accepting pay cuts when taking an in-house position. How do they look back on these decisions?
Sep 22, 2020
A legal professional in the Legal.io In-House Fishbowl asked:
"Am I crazy to leave big law for a ~50% pay cut to take an in-house IP position with a company I’d love to work for? Paid off student loans this past year, so that helps. Would appreciate hearing from anyone who took a similar cut as to whether you regret the decision."
It's well known that many legal professionals end up accepting pay cuts when taking an in-house position. How do they look back on these decisions? Several members of the community responded and shared their experiences.
An in-house counsel at the director level responded:
"I love my inhouse job but as some others mention, in house is a wide spectrum, some in house jobs sound soul killing and not worth the pay cut to work on uninteresting matters/be viewed as a hated cost center, etc.
But if you’re excited about this actual job and this actual company, that’s good. Don’t expect you’ll be able to come back to biglaw super easily if you’ve been in house a long time, especially if it’s not the type of place that is a biglaw client. But if you hate it and want to switch back in a year or so that’ll probably still be an option.
Can you keep up your current lifestyle with a 50% pay cut ? Will it just be a matter of less savings ? Or will you actually need to make some adjustments ?
Also, not sure how senior you are, but keep in mind the pay reduction is also about all the lockstep raises that you’re no longer going to get. It is what it is, but you may make 50% of comparable biglaw today and only 30% of comparable biglaw in 3 years."
An attorney noted:
Most in-house positions involve a substantial pay cut (despite what the internet would have you believe where everyone finds 350k 9-5 inhouse roles as a 3rd year). 50% is step but not unheard of, particularly depending on the accounting method ones uses (i.e. if you're comparing biglaw base+bonus to just base at in-house job for some reason).
If the role allows for growth, or at least the development of a transferable in-house skill set, I would not be super deterred by the substantial pay decrease as long as you are happy with the compensation you'll be receiving.
Another in-house legal professional noted:
"I went in house straight out of law school, so I can’t speak to taking a pay cut, but I have not regretted that decision once. I have now worked for three different software companies and my pay has increased substantially with each move. In addition, if you get with the right company, there are equity incentives and bonuses that make up for some of the difference in pay with a large firm.
The best part for me is work life balance. I am married and we have three young boys and I take them to school and pick them up everyday. My job is flexible hours and I work from home full time (even pre-COVID). At each job I have had flexible time off, so no accrual for PTO necessary, and other great benefits. I usually work from about 8:30 until 4:30, and we have a great, small team.
Not every situation is the same, but for me going in house right away was the best choice I could have made for my family. Good luck!"
A general counsel shared:
Moving in-house was the best professional decision I’ve ever made. While there will undoubtedly be a pay cut, don’t forget to take into consideration other aspects of corporate compensation package and (at least for me) a significant improvement in work-life balance."
A senior legal counsel wrote:
"More like 25% in my case for a similar move. I probably wouldn’t have done it for 50% but that’s because of my own circumstances. Money is a lot of things, but it’s not everything. If you can still live a satisfying lifestyle and it makes sense for your career, it’s eminently reasonable to take the cut. Keep in mind that generally speaking, the longer you’ve been in house, the more difficult it is to move back to a firm, should you decide to."
Many others shared perspectives worth considering for those weighing a similar choice. Check out the in-house Fishbowl (anonymous) or join the Legal.io community for in-house professionals to add your voice to the conversation.