Graduates who accept full-time employment during a law firm deferral period may be eligible for LIPP assistance based on their type of employment, eligible borrowing, and income.
The employment must meet the standard eligibility requirements of LIPP. Essentially, the position must be with an eligible employer, it must be full-time and it must be compensated. Volunteer (non-paying) positions are not eligible for LIPP assistance, except for 2010 and 2011 graduates as described in “Uncompensated Employment” below. Unemployed graduates are ineligible for LIPP assistance.
Determination of Income
Compensation provided by law firms in exchange for legal public interest work, such as, but not limited to stipends and salary advances, will be treated in much the same way as a fellowship. Additionally, any compensation provided by the firm in the period of time between graduation and returning to the firm will be considered when calculating LIPP eligibility. LIPP is indifferent to the manner in which the compensation is disbursed (lump sum, regular paychecks, or quarterly) and will apply the total amount of the compensation to any eligible employment during the time period it is intended to cover. For example, if a graduate is compensated $60,000 for legal public interest employment between January 2010 and December 2010, but begins working in December 2009 and ends in November 2010 they will be ineligible for LIPP assistance in both December 2009 as well as December 2010. This is because eligibility is contingent on being employed in a full-time compensated position and compensation for their employment will not begin until January 2010. Furthermore, the $60,000 will be considered compensation for 11 months of employment (January â”” November 2010) which actually equates to an annual income of $65,455.
If a graduate receives compensation from their firm for August through December 2009 as well as January through December 2010, the amount of that compensation will be prorated over the total number of months the graduate works. For example, a graduate receives $15,000 for August through December 2009 and $60,000 for January through December 2010. If they work October 2009 through December 2010 the $75,000 will be divided over a fifteen month period of time, and then annualized. Therefore, for LIPP purposes the graduate received $5,000 a month, which equates to an annual income of $60,000. If a graduate receiving the same $75,000 works January through December 2010 the entire $75,000 will be divided over the twelve month period in which they work. Therefore, their LIPP eligibility will be based on an annual income of $75,000.
LIPP assistance has historically been available only to those working in paid positions. In response to current economic conditions, for 2010 and 2011 graduates HLS will extend LIPP benefits to those working without pay in full-time public service* positions that would otherwise be deemed “qualifying employment” under the terms of the program.
* “Public service” is defined for the purposes of LIPP as any full-time job for a government, nonprofit [501(c)(3)] or academic organization with non-profit status in the USA, or in an overseas equivalent, with the exception of judicial clerkships which are covered only conditionally.
Deferred Associates in the Class of 2013 and beyond
Beginning with students admitted during the 2009-10 admissions season (which begins in the fall of 2009), LIPP will offer coverage in the case of deferred start dates under the terms applying to judicial clerkships. For graduates in those classes, LIPP assistance will be available only to those deferred associates who enter a LIPP-eligible position during their deferral and intend to remain in a LIPP eligible position at the end of the deferral period. Full repayment of the LIPP benefits received will be required for those who enter a LIPP-ineligible position for any length of time at the end of a deferral period.
Please note: Harvard Law School reserves the right to change the terms of LIPP participation at any time in order to make the best use of funds available.