Allen & Overy cuts NQ solicitor pay by 10%
COVID-19 response measure follows Slaughter and May salary decrease
Allen & Overy (A&O) has cut the salaries of its newly-qualified (NQ) solicitors by 10% in response to the COVID-19 pandemic.
The magic circle firm confirmed this morning that the salaries of its September 2020 qualifiers will drop from a minimum of £100,000, comprised of salary and sign-on bonus, to £90,000. This represents a 10% decrease from 2019.
Last year, A&O upped its NQ pay package by as much as 20% from £83,000 to stretch to the six-figure-sum, following the summer City pay war.
Fellow magic circle firm Slaughter and May confirmed a month ago that its NQs will earn £87,000, a reduction on the £92,000 base salary, while Linklaters is understood to be still considering its NQ pay position.
A spokesperson for A&O said in a statement: “Due to the ongoing COVID-19 pandemic, and in line with measures we have introduced across the firm in response to it, we have made the decision that lawyers qualifying in September 2020 will receive a minimum total cash of £90,000, comprised of salary and a sign-on bonus.”
The statement continued:
“We would like to take this opportunity to recognise that this is a time of great concern for students wondering what the future will hold for them and to state that we have not reduced recruitment levels for the next generation of Allen & Overy lawyers.”
The spokesperson confirmed to Legal Cheek that A&O’s second year trainee cohort will remain on first year pay in line with the firm-wide pay freeze. First year trainee solicitors earn £46,500.
Today’s news is a marked shift on last year’s narrative in which we saw City firms compete with their US rivals in London to top the NQ pay league. Some US firms pay their newbie associates a dollar-pegged salary in excess of £130,000.
Freshfields, however, has decided against an NQ pay cut in spite of the uncertain financial climate brought about by COVID-19. The magic circle’s top payer will continue to pay its rookie talent £100,000.