You probably read the title to this article and said to yourself “but Dollar Barrister, all you do here is talk about how great it is to work in-house. Why wait if I know it’s what I want to do and there’s a great opportunity in front of me?” Well, friends, there is a concrete reason to wait that is grounded in your future finances. It’s a simple one, too: the longer you wait to go in-house, the more senior a position you qualify for, and the bigger salary you’ll have an opportunity to negotiate.
Keep in mind that most in-house positions are pretty static. There is only one general counsel who is getting paid the big bucks and receiving stock options (usually). The position and level you enter the company with is, in all likelihood, the position and level you will stay at unless something extraordinary happens (like a merger or somebody above you quits)
That all being said, you can’t wait too long either. In all of my in-house positions I’ve seen CVs from senior partners applying for entry-level junior positions. I think realistically the sweet spot for making the jump is probably the junior partner level. At that point, you are probably earning around $250,000/year plus bonus, and can, with a straight face, argue for a salary in the $225,000 to $250,000 range and, perhaps, a signing bonus.
I think the trick, though, is to use that base salary and the firm’s bonus pool to push for participation in any bonus programs (cash and/or equity). In my experience, those types of programs can be very ad hoc, and using the leverage you will have as a more senior lawyer coming out of a law firm might be enough to convince HR to qualify you. On the other hand, junior in-house counsel positions tend to be much more rigid in terms of compensation structure – the company will look to pay a base salary and nothing more, typically in the range of a first- to third-year associate.
Of course this all assumes you are looking to go in-house at a large company (over $1B/year in revenue) and have been working in a major law firm in a large metropolitan or regional market. There are a handful of great law firm and in-house counsel compensation surveys available right now from the major search firms, which you can download here, here, and here.
Do you agree with my analysis? If not, why?