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2011/04/nylss-deceptive-practices

NYLS's Deceptive Practices

By Kyle McEntee and Patrick J. Lynch
April 29, 2011

We recently learned of an email sent to accepted students by William D. Perez, Assistant Dean of Admissions and Financial Aid for New York Law School. The email is a response to what Dean Perez considers to be misinformation about law schools in the media. In an effort to convince accepted students to reconsider NYLS, his email tries to balance out the discussion by sharing some positive facts about NYLS. You can view the entire email here

Our issue is not that Dean Perez wants to allay fears about law school in general and NYLS in particular. Any school, especially one where the average debt for 2009 graduates borrowing was $119,437, should believe that its opportunities justify the cost of attendance and should share information that materially affects a prospective's cost-benefit analysis. Our issue is that NYLS has not provided nearly enough information, either in Dean Perez's email or in its publications, to support some of the claims made in this effort to recruit next year's class. Next week, we will submit our concerns to Dean Perez and Dean Richard Matasar in the hopes they will act responsibly to resolve what is possibly a violation of accreditation Standard 509.

Dean Perez claims that "our graduates are getting jobs, earning money and able to repay their loans." But available information demonstrates otherwise. At worst, Dean Perez has overstated this claim in a deceptive and irresponsible manner. At best, NYLS has failed to meaningfully portray the data he believes supports these propositions. We'll begin by addressing the employment and salary information that NYLS provides to prospective law students, and then move on to discuss the (un)importance of loan default statistics.

Getting Jobs. Earning Money.

NYLS's employment statistics webpage ("Statistics Page") (source) is designed for prospective law students trying to answer questions about job opportunities at NYLS. But it takes specialized knowledge about the reporting process and access to third-party information to recognize that these numbers are misleading.

For starters, NYLS provides its nine-month employment rate (89.7%), the breakdown of its employed graduates (first table below), and some of their salaries (first and second tables below).

Salaries
Employer Type Percentage Range (Min-Max) Average
Private Practice 45.6% $28,000 – $160,000 $120,197
Coporate/Business 23.7% $50,000 – $96,000 $75,167
Government 8.2% $41,000 – $72,000 $56,054
Public Interest 16% n/a n/a
Judicial Clerkship 3.4% $42,000 – $58,200 $45,887
Academic 3.1% $40,000 – $45,000 $42,500

You might expect that this table reflects a breakdown of the 89.7% of its 440 graduates because this is the "employment rate for the Class of 2009″ as of February 15, 2010. This rate, although not unusual, is not what it seems. It's actually an adjusted rate, which, until this year, U.S. News used for its rankings:

Employment Rate =
graduates known to be employed OR enrolled in FT degree program
+
25% of graduates whose employment status is unknown
total graduates – graduates who are unemployed and not seeking work

Based on Class of 2009 employment data submitted to U.S. News, we come to a rate of 89.6%. The result is off by .1% due to rounding error, but nevertheless confirms NYLS's rate calculation. As such, the employer type breakdown reflects only 82.7% of the class, because those are the only graduates reporting an employer type.

Next we look at the salary information. Understanding the salary figures on this table requires understanding the size of the dataset. This is difficult based on what NYLS says about its size: "Approximately 20% of our 2009 graduates reported salary information." There is no clarity about what the denominator is. It could be the entire graduating class (440), the number of graduates counted as employed using the adjusted rate (395, from the 89.7% rate), or the actual number of graduates with any job (364, from the 82.7% rate). We will assume that it uses 364 graduates as the denominator on the grounds that these are the only graduates who could be expected to report a salary.

From this, we know that the first table includes salaries for roughly 16% of the entire class (73 graduates). But we have no indication from the Statistics Page as to the distribution of graduates throughout employer types, other than knowing that zero graduates working public interest jobs reported a salary.

NYLS also breaks down the private practice employer type by the salaries attained. The below table breaks down the "Private Practice" row in the first table. Accordingly, this table reflects the job outcomes for 37.7% of the class, or 45.6% of the 82.7% of graduates who were employed.

Salaries
Law Firm Size Percentage Range (Min-Max) Average
501+ 20% $145,000 – $160,000 $159,500
251 – 500 6% $120,000 – $160,000 $155,000
101 – 250 4% $90,000 – $160,000 $136,667
51 – 100 4% $62,000 – $90,000 $81,750
26 – 50 3% $55,000 – $55,000 $55,000
11 – 25 11% $47,000 – $65,000 $57,000
2 – 10 51% $28,000 – $80,000 $54,583
Unknown 1% n/a n/a

The salaries are equally as problematic for this second table. Just as we cannot tell how many of those 73 graduates reporting a salary were in a particular employer type category, we cannot tell how many are working for law firms and represented in this table. Based on the distribution of salaries in the first table, at least 11 graduates were in categories other than private practice. This means that these salary figures by firm size represent at most 14% of the class when you combine all of the rows, though the number is assuredly smaller.

What does all of this mean? Although the Statistics Page includes a cautionary statement that only about 20% of graduates reported salaries, the information provided is still deceptive. It took numerous calculations and data from a third party to figure out how few graduates actually underlie these figures. Yet, when you read these tables, an unknowing prospective who is contacted by Dean Perez and told that "[NYLS] graduates are getting jobs, earning money and able to repay their loans" will see large salaries that can reasonably be taken as evidence of this advertised, short-term solvency. The method NYLS employs to present salary statistics can be persuasive to the unknowing applicant, but it clearly does not reflect reality when, for example, the advertised $159,500 salary average for graduates employed at 501+ attorney law firms reflects the average for, at most, 7.5% of the class.

Dean Perez claims that graduates are earning money, even though the school only reports what one-fifth of the Class of 2009 was earning. If his office has information on the other four-fifths, it would be a good idea to share it when making such claims, rather than lead prospectives to think that the salary information provided is reflective of actual practice. And if NYLS does not possess salary data for the other 80% of the class, then the administration needs to review its recruiting policies and determine whether these statements are designed to mislead and/or have the effect of misleading the consumer. We think they do. When only 62% of the entire class is working in a bar-required position, there's ample room to be skeptical of the claims made by Dean Perez.

Dean Perez also claims that New York Law School had more favorable or comparable employment statistics than [Hofstra, Buffalo, Touro, Albany, CUNY, Pace, Syracuse, Fordham, Cardozo, Saint John's, and Brooklyn]. These are important claims that require adequate evidence, regardless of the economic climate and media attention. In the context of the email, this claim is especially troublesome because it seeks to sway applicants by stating that, despite all of the criticism, this particular law school really is a worthwhile investment. That may be true (and we will not make that call), but the school cannot simply prove its value by comparing itself to the other New York schools. No school can prove its value this way without first having sufficient transparency about the post-graduation employment outcomes of its own graduates.

[See our data clearinghouse to see if you agree that NYLS has "more favorable or comparable statistics" compared to these other New York schools: NYLS, Hofstra, Buffalo, Touro, Albany, CUNY, Pace, Syracuse, Fordham, Cardozo, Saint John's, Brooklyn.]

Paying Back Loans

Loan default rates, contrary to Dean Perez's assumption, do not indicate the value of a program. With the federal Income Based Repayment and Income Contingent Repayment plans, no individual with federal student loans should default. Defaults merely suggest poor advice by financial aid offices and/or poor self-discipline. A graduate can make minimum wage and have significantly-reduced monthly loan payments, thanks to these programs. Both programs have their downsides: interest accumulates and can cause debts to balloon over the life of the payment plan, and in certain scenarios the debtor will be taxed on the forgiven debt at the end of the repayment period. But they are programs designed to make sure that people don't default. If the default rates are low, the school should be applauded for providing sound financial advice, but it is hardly evidence that NYLS graduates are by-and-large doing well, particularly when we only know the salaries for 20% of the class.

Misleading The Consumer

Selective presentation is deceptive. The manner in which NYLS portrays salaries and job outcomes, while not outright lying, deceives the reader into thinking she is more informed about the employment opportunities at NYLS than she really is. Despite NYLS possessing better information (and even reporting some of that information to U.S. News), the school has declined to share information on the Statistics Page that it knows would be valuable, such as the fact that 58.4% of all 2009 NYLS graduates were employed full-time, while 45.2% were working full-time, bar-required jobs. Omission of such important, value-adding information is so obvious that it suggests NYLS actually intends to deceive. Such a perception has enormous ramifications for how people view legal education in this country. This behavior is precisely why we are prompting reform.

Law schools are sophisticated suppliers of a service; they understand what consumers want to believe as truth, particularly consumers facing full tuition costs and six figures of debt. With no incentive to do otherwise, schools hide or otherwise misrepresent the data that might scare applicants away. And when the applicants get wind of it through exposure in the media, we see responses like that of Dean Perez. Absent tougher regulations that require improved disclosure while prohibiting claims like these from being made without factual support, some law schools in the United States will continue undermining the educational purpose they are supposed to serve.

April 26, 2011

Sent only by email.

Dear [redacted]:

There is a great deal of information, misinformation, and disinformation about law schools in the media, on the Internet, as well as those in the legal profession. The economic downturn of the past few years has focused tremendous attention on law schools; not all of the reports are correct or in the proper context. Here are some facts to consider while making your decision:

  • While the number of persons taking the LSAT and applying for admission to law schools in the US this year has declined from last year, it remains the second largest year on record according to LSAC. The media is definitely overplaying (and short-changing the facts) the drop in interest in law study. This was one of the most competitive years to gain admission to New York Law School as our applications increased by approximately 40% from last year.
  • The "angry law grad" movement that has gotten much media attention, most notably by the New York Times, isn't being reported with the full story. What most of these reports, stories, and blogs fail to say is that these angry grads generally did not have clear reasons for going to law school in the first place, did little research on legal hiring and careers before law school, and, most damning, chose their law school based solely or primarily on rankings (like USN&WR) or by name recognition of the law school. By-and-large, they failed to assess their needs and values and focus on outputs of the schools they considered. Don't let that be you.
  • For the past five years, New York Law's bar pass rate has exceeded the New York State average and for four of those five years place us in the top-third in the state. In all five years our pass rate exceeded that of Hofstra, Buffalo, Touro, Albany, and CUNY and for four of those years Pace and Syracuse as well. Our 2008 rate exceeded those of Fordham and Brooklyn and our 2009 rate exceeded Cardozo, Saint John's, and Brooklyn. In this time frame, New York Law School had more favorable or comparable employment statistics than these schools.
  • New York Law School has the lowest student loan default rate of any law school in the country, less than 1/10th of one percent. This means that our graduates are getting jobs, earning money and able to repay their loans.
  • In addition to their overall rankings, USN&WR also ranks various aspects of law schools. Our evening program, which was established in 1904, ranks 44th nationally of the 80 part-time programs ranked. Our Intellectual Property program is ranked 26th nationally. Further, USN&WR ranks NYLS 69th in diversity with more than 30% of our students from underrepresented groups and 12% Latino/Hispanic.
  • New York Law School is one the few law schools with an honors program—the Harlan Scholars Honors Program. In addition, we offer nine academic centers and more than 250 elective courses each year.
  • Our fixed tuition means that your tuition will remain constant throughout your J.D. studies. Other schools raise tuition each year, diluting the value of scholarships and grants and creating anxiety about meeting the increasing cost of attendance each year. At New York Law School, with no tuition increase, we can assist you in your financial planning before you begin and avoid the cost anxiety you'll find elsewhere. Better yet, when compared to other schools in NYC, the total cost of attendance is actually less at New York Law School over the course of the J.D. program.
  • New York Law School receives consistently high marks on the Law School Survey of Student Engagement (LSSSE). One area in which we stand out from other law schools is in the area of student counseling, particularly the availability and quality of financial aid counseling. Take advantage of that and speak with your admission and financial aid counselor.

No other law school in the country has the advantage of location that we have enjoyed since we were founded 120 years ago. With all of the state and federal courts within four blocks of the front door, with our buildings in the midst of the city's civic center—for city, state, and federal offices, and with Wall Street and the world's financial capital just a short walk away, our students learn in the classroom and gain practical experience through internships, externships, part-time employment, and summer employment.

I also urge you to read Shifting the Focus from Inputs to Outputs which appeared in the New York Law Journal on April 25, 2011 and was written by New York Law School Dean and President, Richard Matasar.

Don't miss your chance to Learn Law and Take Action at New York Law School!

Sincerely,

Dean Perez
Assistant Dean for Admissions and Financial Aid