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£150k junior lawyer salaries are ‘out of control’, top general counsel warns

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Network Rail’s leading lawyer Dan Kayne urges profession to find new ways of retaining talent before young associates ‘get hurt’

One of the country’s leading in-house lawyers has criticised the “eye watering” sums of cash being dished out to some newly qualified (NQ) associates.

Dan Kayne, general counsel at Network Rail, said the salaries which can stretch to as much as £150,000 at a small number of elite law firms “is simply way too much” and that he harbours concerns “people will get hurt”.

The top lawyer’s comments come as salaries continue to swell amid growing pressure among law firms to attract and retain the best legal talent. This has been fuelled in part by the pandemic: the shift to home working and the spike in certain types of legal work, particularly M&A, have seen lawyers already working lengthy hours stretched even further.

In comments posted to LinkedIn, Kayne goes on to describe the extra cash as a “sticking plaster” and that “the level of expectation from clients and firms will burn people out before they hit 30”.

Kayne — founder of The O-Shaped Lawyer project that looks to drive positive change and create a more engaged, inclusive and healthy profession — urged firms to find new and creative ways of rewarding and motivating young lawyers.

“We already have a well-being crisis in the profession,” wrote Kayne. “Let’s work together as an industry — clients who subsidise these astronomical salaries and firms who pay them. We all have a responsibility.”

The Legal Cheek Firms Most List 2022 shows only a handful of outfits — all of whom are US headquartered — pay the £150k salaries referenced by Kayne. And the reason they can offer these staggering pay packets is due in part to the small number of trainees they take on each year. Vinson & Elkins, for example, pays NQs a whopping £153,300 but offers just six training contracts annually. Compare this to Linklaters, which dishes out around 100 TCs each year, the highest of any firm in the UK, and pays an NQ rate of £107,500.

The 2022 Legal Cheek Firms Most List

The working hours at US firms are generally higher too. A recent survey undertaken by Legal Cheek — and picked up widely in the national press — found that junior lawyers at some US law firms in London were averaging 14-hour workdays.

This isn’t the first time senior members of the legal profession have gone public with their concerns over junior lawyer pay.

Back in 2020 the managing partner of Fieldfisher, Michael Chissick, hit headlines after he described how his “heart drops when I see newly qualified lawyers in US firms earning more than some of our partners”. He received support in the form of Pinsent Masons senior partner Richard Foley, who described the rocketing rates as “completely unsustainable”.

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57 Comments

MC 3pqe

Has anyone here moved to a US firm as a junior-mid associate? Did you do so directly or via a recruiter, and did you get a sign on bonus? Cheers!

(34)(4)

Anon

You’re a magic circle 3PQE – use your supposed brain instead of asking a bunch of freshers

(108)(22)

MC 3pqe

Sure, I’ll use my brain to find out what other people’s experiences are. I was interested in what other people have done, not asking for advice on how to move. Thanks though.

(72)(1)

US 4 PQE

I recruited a pal from my old shop into our team; USD 30k referral bonus is standard.

(26)(1)

US NQ

I moved as an NQ. No sign on bonus. If you go via a referral you can split the referral bonus. I used both friends (for direct referral) and a recruiter when applying to firms.

(26)(1)

MC 3pqe

Thanks, appreciate the response.

(12)(0)

Tekken Too

As a mid-level. Had a friend at the firm already, so via them rather than a recruiter. They got a sign-on bonus (but split it).

(9)(0)

MC 3pqe

Cheers!

(1)(1)

Realist

Firms prefer that you avoid recruiters. You can just email the practice group head in your target firm, and ask them who the recruiting point of contact is.

(2)(0)

Anonymous

“Let’s find new ways of attracting talent” no let’s not Dan. Let’s pay juniors in this country a good salary. For the hours worked it isn’t that crazy to pay 150k+

(125)(2)

Reasons

I agree with him, I’d rather be able to have a better work life balance than have a few extra hundred pounds per month after tax every year. Last couple years have been horrendous

(24)(2)

Fact checker

Where are you getting your figures from my man?

Say you are on plan 2 student loan and both 5% salary sacrifice. The difference between £100k and £150k is about £1500…….. per month.

(22)(1)

No proper pay on my watch!

Don’t get greedy now. Just think about the poor PE partner’s profits – because of you he made only £3 million last year instead of £3,2 million.

You should be content with 70K, a fortnightly Zoom wellbeing call and free Deliveroo meals if you stay past 11PM. By doing this, “leading lawyer’s” legal bill will also go down (no it won’t). Lastly, inflation is just transitory – I promise that your rent will be reduced next year.

(50)(2)

Reality check

Firms with high revenues in high profit areas in high cost of living city pay high salaries to a total of about 200 people in the entire legal sector. More at 11.

This isn’t even news and the fact this guy is ignoring every single relevant factor as to why these salaries exist and why lawyers might want them is just pathetic. The model is same, the salaries are not disproportionate to what they have been historically, it’s just that everyone else in the UK is paid so little that they seem ridiculous in comparison.

When clients stop demanding crap hours and paying for the privilege, maybe things will improve work life balance wise but not before, high salaries are not the issue here.

(93)(2)

Apple In-House NQ

O no pls don’t hurt me with money.

Grow up.

(68)(1)

FF Sake

Dan speaks the Truth. Slipped on a wad of £50 notes last evening and nearly cracked my head open on my solid gold IFLR award. Thank God the butler was there to catch me (the maid is off on Mondays).

So sick of getting hurt.

(123)(4)

Anon

This was actually quite funny for once, Kirkland NQ take notes

(65)(0)

Anon

Also here to show my love. Good show.

(6)(0)

Kirkland NQ

Surely a freshfields NQ can’t afford a maid and butler on £100000?

(6)(25)

Anon

Was is Freshfields? Surely Fried Frank would be more familiar with a wad of £50 notes?

(9)(1)

Anon

Goodwin have announced that they will pay for associates to have a week long vacation of their choice (Island escape, spa break etc)

(40)(2)

Anon

Yes, paid holiday up to $10k! On top of bonuses and COVID bonuses. And salary has now increased for NQ to £161k which is currently market leading in London.

(32)(1)

Anon

Goodwin are smashing it!

(11)(2)

Anon

Associates have been getting hurt forever. Does he really think working hours were better when they were paid 80k instead? All that’s changed is they are now better remunerated due to a multitude of factors (talent shortage, exceptional investment activity, strong inflation and rising cost of living) etc.

(66)(1)

Anon

People have been peddling the line about the inevitable crash on the horizon since 2008 and how these salaries are unsustainable. Guess what, when London firms laid off half the office in 2008, salaries were just 60k for an NQ and it didn’t make an ounce of difference. The same number will be sacked if it happens again, except this time they have been able to bank themselves some decent savings to survive on if they’ve been smart.

(33)(1)

Too late, the money train is at full speed

There’s no going back at this point.

Firms have demonstrated their desperation to attract the best talent and beat competitors by increasing their salaries multiple times in a year.

(Some firms have increased 3 times, many have increased twice, and pretty much every firm has increased once)

Thanks to LC, RoF, The Lawyer and other legal tabloids, lawyers are all too aware of the bargaining power for their salary increases and how susceptible firms are to matching competitors.

There isn’t a top 50 firm that will have the guts to stick it to salary increases and promote “new ways of attracting talent”

When you look at the level of engagement salary increase articles receive, you can easily identify what lawyers care about

(43)(2)

Anon

Of course! It’s the high salaries that have led to a crisis in wellbeing.

Let’s all get paid peanuts to work the same hours.

(67)(1)

Average Pay War Enjoyer

Smelly chat and a Headspace subscription isn’t going to pay the rent.

(37)(0)

US NQ

I’m not getting hurt. It’s the associates in the transactional departments of MC firms getting hurt.

They work pretty much the same hours as us and get paid £45k less (and that’s before the $bonuses$). Suckers

(42)(3)

Beachcroft NQ

otally agree with Dan. When are we going to learn we can’t paper over the cracks!!??

My bamboo yoga mat, my cycle to work and my holiday home (tent) in South Downs National Park all give the well being we so desperately crave.

Let’s all rally together and say NO to £150k salaries. Amirite guys?

(36)(1)

CRS NQ

Hey mate, when you cycle home later to Croydon can you please stop by the Tesco express? I have been told by a mate that they discount all of the meal deal sandwiches if they aren’t sold by the end of the day. Would really appreciate it if you could grab me some – tuna and sweetcorn for me!

(34)(2)

Beachcroft NQ

Sure thing bud, hate food wastage. Don’t worry about payment but if you could plant a tree in my name that would be swell.

(29)(1)

An Admirer

This gave me a genuine laugh, keep up the good work!

(2)(0)

Anon

Goodwin London raised NQ to £161k plus bonuses as of yesterday. So expect others to follow suit soon.

(33)(1)

Anon

Whats the point though? You’re not really living if you work at those firms – it’s just existing. There’s more to life

(2)(3)

Anon

NQ at Goodwin now £161,500

(2)(0)

Anonymous

Try being on 30k as an NQ. Now that is painful.

(20)(0)

149k p.a

Well guess I’m ok then

(8)(0)

Dinosaur Hater

Someone tell Dan US associates have been earning 150k for about 20 years.

Absolute dinosaur.

(14)(0)

Anon

4 pqe at Goodwin now £241,000 plus bonus

(18)(0)

is this true?

good lord.

(0)(0)

Troof

Yes it is. 3 pqe is £214,000 plus Cravath/MB bonus plus a $7,500K stipend (up to $10,000 for 5 pqe+ to spend on annual leave (protected) and $500 each quarter to spend “having an evening on the firm” (protected).

(8)(0)

Neil

Oof so over 11k a month? Yum

(0)(0)

Anon

Interesting, I didn’t think they had published any salaries above 3PQE?

(0)(0)

Anon

“and the reason they can offer these staggering pay packets is due in part to the small number of trainees they take on each year…”

Eh?

(12)(2)

US powerhouse

Complete nonsense. Goodwin are taking 15 trainees in the upcoming September intake which is around the number of trainees on each September intake at mid size U.K. firms.

(6)(0)

anon

For some reason I was under the impression it was their ability to charge £1000+ an hour, or charge success fees as a percentage of a financial close on multi-billion GBP finance/M&A matters and therefore consistently achieve average RPL’s in excess of £1m.

Silly me though, clearly that small trainee intake is the golden ticket to that profits life. I’ll let my firm know. Thanks for teaching us the economics of legal practice, LC editors that have never practiced a day in their lives!

(9)(0)

IHL

Odd how it’s the people on these salaries that have the biggest issue with what he’s saying and are obviously and wilfully missing the point completely. But hey, good luck spending £150k a year when all you do with your life is work 18+ hours a day and still get yelled at for not getting enough done. I hear cash lines coffins really well!

(5)(30)

Not buying that

Because he is masquerading his complaints about NQ salaries as some sort of concern about juniors’ well-being. Typical in-house delusion where people think that their law firm will charge them less if NQ salaries go down.

Are you really that gullible or just pretending?

(19)(0)

Barrister

Any bazzas on here able to share info on whether their set is looking to increase fees given current economic climate?

(6)(0)

Barrister

Hourly rate may go up but more likely we will just do a genuine estimate for the time it will take to do the work (rather than baking in reduced hours to appear commercial to get the work)

(3)(0)

Some guy

What does this mean? Like, are you asking whether sets are increasing their members’ hourly rates? No idea. Ask a clerk.

(0)(4)

Can’t tell me nothing

I guess the money should have changed him, guess I should have forgot where I came from.

(8)(0)

therapy alpaca

what level of neoliberal brain rot is ‘junior lawyers need less money, more ⭐️ mental health resources 👁👄👁’

(19)(0)

5PQE US lawyer

I think Dan Kayne has a point. He is not saying that junior lawyers do not deserve the salaries they are getting, he is saying that the salary increases are a sign of dysfunction in the legal market.

The simple fact is that legal services are continuing to grow (particularly in the City) and that trainee numbers have not risen accordingly. The Law Society publishes data on this (https://www.lawsociety.org.uk/topics/research/annual-statistics-report-2019) which show that, remarkably, in the year 2018-19 (the most recent year for which data are available), admission rates (i.e., NQs) were 18% lower than in 2008. Indeed, you have to go back to the early 00s to find a year where admission rates were lower than they are currently. Granted there is no breakdown for the type of firm, so the data will be muddied by whatever is happening in the criminal and high street markets. Bottom line, the legal market has grown substantially in the meantime but the number of qualified lawyers has not grown in proportion.

Small wonder that there is increasing burnout in the profession and that there is a pay war for those who are capable of doing the work. In a niche transactional practice like mine, there are literally a handful of associates at my level in the City and yet the demand for firms to build out those practices is acute.

The simple answer is for law firms to take on more trainees, but that will take time and probably too long for the pressure on salaries to abate.

So Dan is right that change is needed, but the salaries are a symptom of the problem with City firms having not invested sufficiently in increasing their trainee classes since the financial crisis.

(9)(6)

Network Rail HR

Thanks Dan

(25)(1)

lol

except this bloke isn’t instructing firms that pay their NQs the Cravath scale, he’s instructing a regional office of Dentons

so why does he think that he gets to have an opinion?

(0)(0)

Comments are closed.

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