You heard it here first, a full hour before any other publication, and it’s now been confirmed that the Solicitors Regulation Authority (SRA) has scrapped the minimum wage for trainee solicitors.
The good news for current LPC students is that, firstly, the change won’t come into force until August 2014, and, secondly, trainees will still receive the national minimum wage of £6.08 an hour. Trainees will NOT be re-classified as apprentices and so the fears that they could earn just £2.60 an hour have proved unfounded.
I attended the SRA meeting at which the rule change was agreed this afternoon, and it was difficult to argue with the logic of the regulator’s board members – several of whom had clearly agonised hard over the decision.
In the end, it boiled down to four key points.
1) Why, other than for socio-economic diversity reasons, should the SRA impose a minimum salary when no other professional regulators do (other than the Bar, which sets its in line with the national minimum wage)?
2) Is a minimum wage really the best way to foster socio-economic diversity, and rather than relying on this wouldn’t the profession be better channelling energy into grass roots projects to get people from a wider variety of backgrounds into law?
3) The SRA is set to imminently introduce a work-based learning model following a successful pilot – and those coming through this route wouldn’t be eligible for the old minimum salary. So if you’d kept it, you’d have ended up with a two-tier system with some trainees getting more money than others.
4) Removing the minimum wage may enable recession-hit firms to offer more training contracts. During the meeting, this letter (and the ensuing comment thread) to the Law Society Gazette by jobless LPC graduates in favour of scrapping the minimum wage was discussed for around 20 minutes.
Personally, I’m just about in favour of scrapping it – provided the profession puts its money where its mouth is by bringing in some decent diversity schemes.
But I know many are fiercely angry about the SRA’s decision, including Legal Cheek’s own Kevin Poulter and Junior Lawyers Division chair Hekim Hannan. Here’s what they had to say:
"It is nothing short of disgraceful that the SRA Board have voted to abolish the trainee minimum salary in 2 years’ time. They have effectively slammed the door shut in the faces of those from lower socio-economic groups trying to enter the profession. £6.08 an hour for a 35 hour week is a salary of £11,065 a year and a monthly take home of £838.02.
Furthermore, most trainee solicitors work more than 35 hours a week but it is unlikely that they will ever complain as they will be in danger of jeopardising their future careers. Exploitation for the most vulnerable in our profession will be open to abuse.
How will someone without parental support manage to fund the LPC and then, if they are lucky, obtain a training contract at minimum wage? The loan repayments on the LPC are in the region of £300 - £400 a month. That leaves a little over £400 a month to live on, not taking into account any overdrafts, credit cards or other student debts that maybe immediately due.
Those from lower socio-economic groups will have to work 1, 2 or 3 jobs while they are studying, which will inevitably have an impact on their results and their future careers. The profession is difficult enough at the moment to enter for those from lower socio-economic groups . This decision by the SRA is the final nail in the coffin for those with the work ethic and aspirations to enter the profession without the financial backing.
The whole process, from consultation, review and decision has taken place within 4 months. The JLD have spoken to their members at their events and put together a detailed response to both the consultation and the Equality Impact Assessment. The only reason that some people thought abolishing the minimum salary might be for the good is that it may possibly increase training contracts. However, against this not a single firm has stated that a new training contract will be produced.
Furthermore, if any training contracts are forthcoming they are likely to be at the lower end of the salary range which would ‘price out’ all but the wealthy. There has been some recent inroads in social mobility but this is a step backwards. It makes the LETR and the development of more flexible and financially viable routes into the profession even more important.
It feels as though the decision was already made and the rushed consolation process was nothing more than the SRA ‘going though the motions’. The consultation, the press release following the equality impact assessment and even their agenda notes for their board meeting were heavily biased towards abolition giving far more weight to anything that supported their decision and paying only lip-service or ignoring the real impacts of abolition.
The JLD are taken from and represent the junior end of the profession and are completely in touch with our membership; are the SRA board in touch with those entering the profession? From this decision it shows that they are clueless and completely out of touch with the most vulnerable of those who they regulate."