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Enthusiast
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Budget/overhead means that your salary should be about 1/3 of your collected fees. If you're only collecting twice your salary, the partners are getting pinched
Generally 1/3 salary, 1/3 overhead, and then 1/3 partner profits
@a2: didn't know it was a UK thing but I've heard it in the US also, by convention anyway. Of course overhead varies from firm to firm.
They like to sweat the assets to generate more pie for the equity
Enthusiast
It's pretty rare for law firms to fire first years or even laterals (minus a recession of some sort) for just one year of low hours. Firms know it takes time for junior associates and laterals to ramp up. You might be asked to improve your hours during your evaluation and then directly warned multiple times by partners before the firm tells you that you should look around for another opportunity. Even then, firms will give you 3-6 months to find another job (which is honestly pretty generous).
If your hours are low, you can also do pro bono or find some other way to get involved in youe firm (i.e. mentor for SA, diversity events, etc.). Your firm will probably see you as a team player if you do that and the chances of you being let go due to low hours is even less likely for at least a few years.
Firms don’t fire anyone. They just wait for you to leave.
This is very false.
I'm confused by this, too. 3x my salary = ~1200 hours billed. I'm billed pretty highly relative to my pay.
While not a complete answer your salary is not reflective of your total cost to the firm. There is the employer side of your payroll taxes, any profit sharing or other contributions by the firm to your 401k, health insurance if subsidized at all, parking garage fees if paid by the firm, any marginal increase in malpractice insurance premiums due to each new attorney, and potentially a whole host of other costs you’re not accounting for.
Coach
When people are let go it’s usually because the low hours reflect people not wanting to work with you, not because you are losing $ at 1500. I have known people in biglaw satellite offices who billed 1600-1800, doing good work for a single litigation team, and were able to stick around 10 years or so before being pushed out.
This - as long as you are still broadly profitable, it’s other things that distinguishes you, including quality of work product and your relationship with other people in the firm. I have seen people who bill 2000+ hours a year passed over for partnership in favour of people who billed 1600-1800 but did stuff like high profile pro bono, or took part in/organised firm committee and events, had really good feedback from clients and had internal partner sponsors.