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City law firms introduce belt-tightening measures in wake of COVID-19

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Furloughs, pay cuts and partner profit deferrals

City law firms continue to tighten their belts as they look to protect themselves from the impending financial fallout of COVID-19.

Bryan Cave Leighton Paisner (BCLP) said it was seeking pay cuts of 15% for all employees across its offices for a 13-week period starting in May. Staff earning less than $40,000 (£32,000) will not be affected.

The global firm also confirmed it is deferring payments to partners, offering sabbaticals at 30% of base pay, as well as part-time working arrangements to some employees.

“By acting swiftly and decisively, we expect to maintain our strong financial footing,” BCLP’s co-chairs Lisa Mayhew and Steve Baumer said in a statement. “Taking these precautions now, and acting in the best interests of our firm and all our people, will position us well for the future.”

Meanwhile, Eversheds Sutherland confirmed it had placed staff “who are not able to perform their duties whilst working remotely” on furlough for the next three weeks. During this time it will top up the payment from the government so that staff receive their full salary.

It also said it had taken the “difficult decision” to delay pay and bonus review until the end of October. However, candidates who successfully passed their assessments and interviews will be promoted from 1 May as planned. Promotion-related pay rises have also been deferred.

Eversheds said discussions around partner pay-outs were ongoing “but the expectation is that drawings will shortly be reduced and/or deferred”.

For staff with care commitments, the firm has launched an enhanced holiday scheme which gives an additional day of holiday for every four taken to care for others, as well as a hardship fund to provide additional financial support to individuals who are particularly impacted by COVID-19.

Elsewhere, DLA Piper has placed some of its staff within its UK property and workplace team on full paid leave. The international firm is also understood to be considering a delay or reduction in partner distributions.

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A spokesperson for the firm said:

“Our primary focus is ensuring the wellbeing of our people while also maintaining a robust business through the pandemic and beyond. Given the nature of their roles, some of our people in our UK property and workplace team are unable to carry out their work so are currently at home while on full pay and benefits. As some of our property and workplace team are still able to work within government guidelines on rotation, our critical services remain fully operational.”

They continued: “Like all businesses at this time, we are closely monitoring the situation to ensure any decisions, should they become necessary, are made with due consideration and are in the best interests of our people, our clients and our business.”

It has also been reported that partners at Slaughter and May will temporarily go without pay in response to the pandemic. In an email seen by RollOnFriday, the magic circle player’s senior partner Steve Cooke confirmed all “discretionary distributions to partners” have been suspended with the money “being retained in the business”.

Fellow magic circle outfit Linklaters has taken similar action, cancelling its latest quarterly partner distributions and postponing yearly salary reviews to “preserve cashflow”. But it confirmed it was “not currently proposing any redundancies as a result of the challenging business environment”.

Similarly, Womble Bond Dickinson has deferred parter payouts and placed some UK staff on furlough. UK managing partner Jonathan Blair said:

“Like all businesses around the globe, the COVID-19 pandemic is impacting our firm. In order to protect our business and job security in these extremely uncertain times, we have asked some colleagues to go onto furlough leave and will be topping up salaries to 100% in April.”

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22 Comments

Linklaters associate

Links are not just postponing yearly salary reviews, they are keeping all associates on current salaries despite the year increase in PQE.

Look at this fool and laugh

Boo hoo hoo you c*ck, be grateful for having an solid income.

Once this mess is over, there’ll be over a billion people in the world without a job and without hope.

Kirkland Associate

And you’ll be one of them pal… if you need a bit of cash I’m looking for someone to clean the Lambo

Your mum

Such a twat!

Kirkland NQ

I got a gimp to clean mine bro, I’ll text you his number. Said he was from a place called CMS? Never heard of them but he sure knows how to wax a gull wing door.

Kirkland Associate

Cheers brah

Anon

And many dead.

The above poster is emblematic of the social ignorance and selfishness that permeates society today. Life has now become a commodity and the (blind) pursuit of wealth does NOT make us happy.

Latham associate

Makes me happy

Kirkland NQ

“Wealth does NOT make us happy”

– person without a Lambo or a Chelsea Townhouse

anon

Well said by the first year LLB choad, stuck gimping through e-learning Tort lectures. Best of luck applying for TCs.

Big Diggs Higgs

Don’t know how these people live

Kirkland NQ

The underclasses always respond to wealth with jealousy. So predictable.

Angus

Any news re CMS or SPB?

Weil trainee

Hear you’re all getting binned mate

CC NQ

Hear you won’t be kept on mate

Weil trainee

No problem, can always get a gig at a beta shop like Clifford No-Chance

Anon

Lmao keep dreaming choad.

Ant

My firm (large international) has been at pains to reassure us all that there will be no cuts in pay, but I suspect most of the associates wouldn’t balk too much at a pay cut provided it could be shown to be reasonably necessary and it was after the partners had taken a large hit. Perhaps bizarrely, I’d actually find it a bit reassuring as it would convince me the management weren’t being blasé! If it emerged to have not been necessary they could undertake to give it back at bonus time (and yes, I would take them at their word on that).

Anon

To the Kirkland NQ above – Kirkland isn’t exactly leading by example in this is it and you probably won’t be reading about that in the press either. You’re too blind and far down the chain to notice, being just an NQ. You’ll be on your way out sooner than you think, just like the many others before you.

Kirkland NQ

Lol whatever. All I know is that when they tried to furlough some ‘landers, the government begged them not to, as even funding 80% of one lawyer for three months would bankrupt the country.

Not Kirkland NQ

There’s a £2,500 per month cap on government funding?

Anon

The scheme is. capped at £2,500…

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