US outfits Kirkland & Ellis and Milbank Tweed boost London NQ pay packets to a staggering £124,000

US law firm pay war benefits fresh-faced associates this side of the pond

Pay

US outfits Kirkland & Ellis and Milbank Tweed have boosted the pay packets of their London-based junior lawyer talent to an astonishing £124,000. The new pay increase brings their London newly-qualified (NQ) lawyers in line with their New York-based counterparts.

Elite Wall Street firm Milbank, Tweed, Hadley & McCloy — which offers around five training contracts each year in its London office — has just upped its London-based pay to £124,000.

Kirkland & Ellis — which offers 12 City-based training contracts annually — has gone and done the same, upping its pay from a very respectable £100,000, according to legal blog Roll on Friday.

Both firms are responding directly to a recent pay hike by New York-headquartered giant Cravath, Swaine & Moore. Earlier this week Cravath upped junior lawyer pay from $160,000 (£110,000) to $180,000 (£124,000).

Within an hour of Cravath making the announcement, and not a firm to be out done, Milbank’s management were firing off emails to staff confirming the same increase. Matching the new coveted £124,000 figure, the firm — with over 600 lawyers across 12 offices — revealed that their London-based NQ lawyers will also receive the same vast pay increase.

According to Legal Cheek’s Most List, and to provide some contrast, NQs at both Kirkland & Ellis and Milbank Tweed will now walk away with almost £40,000 more than an NQ at Clifford Chance.

It would appear that two other US giants with a London presence Davis Polk — who offer four London-based training contracts — and Simpson Thacher have also adopted what is now being dubbed the “Cravath pay scale”.

With their US-based newly-qualified salaries upped to the same eye-watering £124,000, internal memos sent to staff at both firms revealed that there would be comparable rises for “English law qualified associates”. According to Chambers Student, Simpson Thacher does not currently offer UK training contracts.

Away from the US elite, at least one magic circle outfit has also joined the US pay bonanza.

Above The Law has confirmed that US-based associates at Anglo-German firm Freshfields will receive the new £124,000 figure. In an internal memo (pictured below) thanking staff for all their hard work, regional managing partner, Adam Siegel, confirmed that lawyers at the magic circle outfit’s New York and Washington offices would have extra cash chucked their way.

Lead1

Allen & Overy, Clifford Chance and Linklaters now have the tricky task of deciding whether to follow Freshfields and remain competitive within the US market. If they do choose to up pay, firm management will have to have a difficult conversation with their City lawyers on why their US counterparts are earning a fair amount more than them each year.

Indeed this US pay influx has the potential to have further inflationary effects in the City. As a new band of super-paying US firms emerges in London, other American outfits — such as White & Case and Shearman & Sterling — may be forced to up pay too. Which in turn may compel magic circle outfits to re-evaluate their own pay grades to ensnare the top legal talent.

Whatever the outcome, it would appear the “100 club” is done with and the new elite “124 club” is the place to be.

51 Comments

Dr Law

Good to see the price of your personal life is moving along nicely with inflation.

(33)(0)
Charlotte Proudman

Why doesn’t it say in the confirmation email whether the associates are attractive or not?

(11)(2)
Anonymous

Not sure why a pay rise in the US leads to a pay rise here. It’s not like a pay gap would drive all City solicitors to fly to New York and cross-qualify.

(2)(14)
Bumblebee

Although Kirkland & Ellis may offer £39,000 more than an NQ at Clifford Chance would get, post tax this only translates to around £18,200. Still, nothing to be sniffed at.

(11)(5)
Impressed trainee

I’d say an extra £1,500 or so a month is definitely nothing to sniff at. That’s essentially one month’s rent for most zone 2 apartments. Pretty damn good, hopefully others will follow suit, even if it’s just a modest little bump.

*nudge nudge wink wink Reed Smith*

(19)(0)
Tyrion

“post tax this only translates to around £18,200”

Are you high? That’s some good eating mate.

(9)(0)
Jones Day NQ

OK that’s it! I am sending my CV off to Kirkland then.

(11)(15)
US 1PQE

Heh, good luck getting any interest at Kirklands coming from a muppet house like JonesDay.

Most of the City avoids you Tudor Street types like the bubonic plague.

(37)(4)
Anonymous

You appear to have capitalised the word city, without defining it. Muppet.

(3)(9)
Confused

I can’t tell if this response is absolute genius or complete stupidity.

(9)(0)
Anonymous

Since it’s likely a chippy JD trainee, I’d say the latter.

It does have a mysterious sheen of brilliance to it, though.

(7)(0)
insight baby, insight

I wouldn’t count on it to be honest. Where’s the value to justify a major increase?

HSF will likely try to stay competitive with other international and MC firms by perhaps upping to £75k, ditto for Macs and Travers, but I doubt that Ashurst or KWM will be able to do so.

Especially KWM, still reeling from its recent partner exits, will likely try to tread carefully before splurging with a big raise. £64k NQ ain’t that bad anyway.

(3)(1)
Gary

Tomorrow bro, the managing partner just told me. Pillow talk is the best.

(6)(0)
Anonymous

“£64k is not bad” – are you at any of these firms by any chance? It’d make sense – with your lack of ambition you’re probably a right fit for them anyway.

(9)(7)
Anonymous

Watch out everyone, a big swinging dick lawyer has entered the building.

(21)(2)
Anonymous

Wow, to think these NQs will be paid literally double what newly minted associates at SH, Eversheds or Pinsents will get is so depressing.

I mean what’s even the point, working just as hard if someone gets twice as much?

(8)(2)
Cash for hours

I do think that these high paying US firm have slightly more ambitious targets than some of the firms you mentioned. However I have to be honest, if you’re a corporate deal monkey at SH or Pinsents working long hours and on half the wedge of someone at Milbank but working 95% of the same hours, I would look to leave. UK firms can cut the rubbish about better training and partnership prospects. Its not true in most cases. These English City firms need to start paying people rather than expecting them to show loyalty to them, which they wouldn’t show to these employees themselves. They can rely on people wanting to join as trainees, but with such a disparity people will jump rather than work long hours in corporate/banking for rubbish pay. Even in-house roles pay junior lawyers 50-70k and the Shed barely even tops that.

(10)(0)
Anonymous

Do you reckon it would be realistic for, say, an NQ from SH or Pinsents to jump ship and actually move to a US firm like Milbank or SullCrom?

Sometimes it seems to me like one is kinda locked into the ‘caste’ of firms where they trained, i.e. an MC-trained person can reach a Wall Street-calibre firm, but someone from Trowers or Eversheds can’t.

I dunno, I hope I’m wrong.

(2)(0)
Anonymous

I don’t think it works like that. You get people from regional shops at Latham/Kirkland etc.

This might be the case, if you’re trying to move on qualification.

(1)(0)
Anonymous

As in that it might be impossible to move on qualification? Or that it’s possible? Not sure if I’m getting what you’re trying to say.

(0)(0)
Anonymous

Eversheds to Skadden on qualification probably won’t happen. US firms will be looking first for MC trainees who turned down NQ offers, and will then be inundated with interest from trainees who were not taken on by their firm.

I think you could probably move to a mid-tier US firm, but I think one of the ‘wall street firms’ would be difficult. Past the qualification point, it really depends, sometimes firms just need bodies.

(0)(0)
Tyrion

“Past the qualification point, it really depends, sometimes firms just need bodies.” This is spot on. Between 1-6 pqe you can pretty much move around as long as you are in a good team and want to stay in your practice area. Attrition is massive at these top firms, people get married, have kids, move abroad from london for serious wedge or quality of life, move into finance for serious wedge etc. There are vacancies. Firms love NQ-3 as you are useful, cheap and won’t complain too much. So yes an associate at PM/SH with a couple of years pqe can move around quite easily, perhaps to magic circle first then top US, but its possible.

After 6/7/8 years pqe you pretty much have to either have some reputation in your area or get headhunted, or move down, although people do still move up/around though.

(4)(0)
SarcyBum

Why would Silver Circle firms, like Addleshaw for instance, need to increase salaries? I mean, isn’t it a pleasure to work for the best law firm in the world like Addleshaw? The prestige far outweighs the salary, surely?

(22)(0)
SarcyBum

At Addleshaw we wouldn’t be entertaining Kent – we’d only consider Zone 1 thank you very much.

And we’d have plenty of money left out of out salaries to wine and dine ourselves and perhaps even have fish and chips on the odd weekend in Covent Garden to show to others, and prove to ourselves, that we are really grounded and also bold and beautiful – like our clients.

(10)(0)
Anonymous

“£64k is not bad” – are you at any of these firms by any chance? It’d make sense – with your lack of ambition you’re probably a right fit for them anyway.

(0)(1)
Anonymous

I bet you eat these chips in Covent Garden off each others shoulders.

(13)(0)
Tory Powerhouse

Heh, mixing words like ‘best’ or ‘prestige’ and Addleshaw Goddard in the same sentence.

Mega lol.

(15)(0)
Wishful thinking

Ha the day AG increase their NQ salary will be the day all hell freezes over

(1)(0)
Future US Firm Trainee

Hope other US firms (Weil, Latham, White & Case, Jones Day) follow suit

(4)(2)
Diddley

Doubtful that W&C or JD will do it since they never aimed to match their US offices in the first place.

Weil and Latham likely will do so soon however, as they do have a matching compensation policy. Same goes for Skadden, SullCrom, Ropes & Grey, maybe even Shearmans and Sidley.

(6)(0)
Anonymous

But W&C and Sidley still increased their salaries from £75k to £90k last year in order to remain competitive. Its not unforseeable that they will increase their salaries again, especially after the recent Magic Circle and US Firm salary increases. We’ll have to see!

(2)(1)
Anonymous

£90k ain’t £124k baby.

For JonesDay to make such a giant raise they’d first have to get floating charge over their office coke stockpile.

Try getting that past their partners…

(9)(0)
Anonymous

Blimey. Here’s hoping Mayer Brown matches this or I’m off. And that would hurt MB, seriously – I’m kind of like a big deal there.

(8)(0)
SarcyBum

Go to Addleshaw – better quality work of course and you’re bound to pull despite the salary.

(7)(0)
Harry from HR

I’d recommend jumping ship while when still time and going straight to Irwin Mitchell.

Sure, you’ll be paid a shyte salary, you’ll have to give away your cell phone every morning when you come to work, your supervising partner will be an obese, flatulent guy from Sunderland called Gareth and the work will be menial, but think of the prestige!

I mean, the sheer power of the brand is enough to make any City recruiter tremble…Irwin Mitchell…say it with me, it’s a name everyone recognises, and mistakes for a high street bookies. But no sir, this is a law firm, and what a wonderful firm it is. Top firm even.

(20)(0)
Charlotte Proudman

I think Addleshaw is all I need to raise my profile. But are the associates fit?

(7)(0)
Anonymous

Is the better Magic Circle comparison not to Slaughter and May? K&E NQs will now earn £52,500 more than SM NQs. And that difference could easily rise to £70,000 after bonuses -which is phenomenal.

(5)(0)
The Nosey A-Level Student

Well, so much for thinking that post-21 the world of adults would have more substance than a meagre dick-measuring contest over wages.

Now if you`ll excuse me, I need to get back to listening to Russell Brand rant about capitalism as I braid my dreadlocks, listening to cliché` indie-music…

(1)(0)

Comments are closed.