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More on Law Firm Bonuses:
Eugene links below to Saul Levmore's post on law firm bonuses, and I wanted to add a thought: I would think firms structure compensation that way because most applicants for biglaw associate positions have little information about firms and an uncertain commitment toward making partner.

  The lack of information about firms makes many applicants unusually sensitive to the very clear and measurable salary numbers. You may not know if you'll like one bigfirm over another, but you know that "160" is a higher number than "145." At the same time, once an associate has signed on, he or she may not have a clear incentive to be a top performer. Big firms often make very few partners, and the partner track is a decade long. In that environment, the promise of a financial reward for working hard and doing well may really influence an associate's willingness to bill all those extra hours.

  From the firm's standpoint, then, you would want to distribute compensation between salaries and bonuses. Put too much compensation into the bonus and it's harder to reach job applicants who may be unsure of the compensation package; put too much into the salary and you remove part of the incentive to keep billing. That's my guess, at least; I don't claim to have any remote expertise in this area, and I would assume it's the subject of a broad literature.

  UPDATE: Commenter "Patrick216" makes an interesting argument about bonuses and associate retention here.
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