City pay war: Clifford Chance responds with improved £125k NQ lawyer rate
Extra 16%
Clifford Chance has joined the magic circle pay war, upping rates for newly qualified associates to £125,000.
The cash injection equates to a hefty rise of 16% or £17,500, with base rates previously set at £107,500. The firm last increased NQ pay in November.
The revised salary sees CC match that already on offer at Freshfields (£125,000) and surpass the £107,500 dished out by Allen & Overy and Linklaters. NQ rates at Slaughter and May currently sit at £115,000.
The Legal Cheek Firms Most List 2022 shows CC provides around 95 TCs annually, one of the highest offerings by any City outfit, with a salary of £50,000 in year one, rising to £55,000 in year two.
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78 Comments
Anon
Fair play from CC – can any associates shed light on the new pay scale up the bands?
Anonymoose
We do not know yet. Will find out over next few weeks.
Noni
US firms still paying 140 should up their game now (CGSH for instance)
Truth
Hardly a US firm in anything but the name. It’s like if Jones Day was a better firm.
Anon
What do you mean “hardly a US firm in anything but name” it IS a US firm because it is a firm established in the US . It’s really that simple fresher.
Disgruntled
Ropes…
USFirm Assoc
About time they should (long overdue). Was already thinking of replying them recruiter DMs.
Anonymous
Does anybody reckon the likes of Baker McKenzie, Hogan Lovells, Reed Smith etc. will rise to £120-125k from their current standing of around £105-107.5k?
Historically they’ve always paid slightly less than the MC but have always paid more than SC, but not sure how serious this pay war is compared to the rises from last year.
Debby Downer
They won’t pay more than slaughters
And they only typically pay 3-5k more than SC so I wouldn’t get too excited
Anonymous
I anticipate the 105-107k firms (Bakers, Reed Smith, Ashurst, Mayer Brown) will raise to 115/120k, just to show they mean business.
Think about it, there’s barely anything to differentiate these type of firms now, because even this raise by CC to 125k (after tax) is a measly 500 quid a month more. Hardly worth moving firms for those at the above, and still a different ball game to somewhere like Goodwin.
Anon
An extra 500 a month net isn’t measly, anything to the contrary shows a shocking sense of entitlement. Most of these people are around 24/25 and being paid some of the highest salaries in the country.
Anonymous
I agree, in any other instance this would come across as ‘entitled’ but we’re talking about CORPORATE LAW FIRMS. This game is all about money whether you like it or not.
For pretty much the same role, an NQ at Gibson Dunn can pull in nearly 7k a month.
1.5k in NQ terms is significant. 500 quid less so…
Child Alert
“Pretty much the same role” – minus the quality of work, IT infrastructure, adequate junior support and free time
lmao
@Child Alert's Father
I think you’re the child here bub, ‘lmao’. The quality of work standard between top US/MC firms is truly negligible-ask anyone in the industry (or check legal cheek’s list if you’re that way inclined).
IT infrastructure? What does this even mean? All you need is outlook, some basic file management systems and Microsoft word really. You really think US firms are still using Windows XP and don’t have dedicated tech support?
Junior support is the only area where I slightly agree with you, but even then most junior folks at US firms have a dedicated paralegal. Free time? Again, this is CORPORATE LAW. Even in an SC/MC firm if you’re truly wanting to make an impact you will not find yourself with much free time, ESPECIALLY in transactional areas.
Child Alert
I should’ve said “fresher alert”, gauging from these rebuttals 😷
1. Most US firms in London do not win the same level of work as MC firms, especially outside of their native areas of funds, PE M&A, high-yield debt, blah blah. You assume that K&E/Latham = “US firm”. Most US practices are pretty irrelevant and do whatever comes in through the door. You usually get two or three US firms with an actually top-drawer practice per practice area and the rest are … not quite there.
2. IT infrastructure means having a functioning document management system, newish laptops & IT that doesn’t just exist somewhere in the United States and is actually responsive. It means having document production people on hand to help with documents or pitches at short notice. It means not having to deal with antiquated conf call systems or (even worse) having both your work and mobile SIMs on one device.
3. You can get beasted in corporate law at a UK firm and yet have weekends & holidays & the occasional evening plan respected. As well as things like time off in lieu. Also MC/SC firms are far more likely to practice areas of law that aren’t utterly bonkers when it comes to hours, unlike, say K&E. The point here isn’t that the hours aren’t long, it’s that they’re still borderline humane, and that they’re shorter than those in a comparable US team in the long run.
I wonder if viewing the world in such a black-and-white way is going to help you pass the fabled Latham VI (or indeed help you at any other point in your life!)
BBC
Adding to Child Alert:
1. Elite US firms (ie. firms that pay over £200k at 3-4PQE) make real bucks because of the clients they have. The deals they tend to do are high value and complex, and would be similar to if not better than MC firm work. MC firms are no where as profitable as US firm. You’re right however that US firms are only good at several practice areas ie. funds, Levfin, restructuring and PE. The rest are rubbish.
Elite US tend to have lower rankings on legal directories due to smaller teams. I wouldn’t however take it that the US firms are inferior to MC firms.
2. Even smaller elite US firms have strong back office support these days.
3. Correct. Hours at any elite US firm are jolly bad. But you’re remunerated well for the sacrifices you make.
USFirmAssoc
Entitled? Have you seen what Kylian Mbappe is now on ? He’s only 23.
Poppy
he has skill and talent hunnibun, you er turn docs
Anon
No one is denying he is entitled. But so is scoffing at a “measly” 500 pounds extra a month which to most of the population would be really quite significant.
SirHumphrey
And Kylian Mbappe didn’t get a First at Oxford.
bappeM
Oh my gosh, SirHumprey…for every Mbappe (a talent that comes every 5-10 years) there are thousands of Oxford firsts per year.
Anonymous Anon
HL have matched CC and others in upping the final LPC cohort grant to £12,500 – somewhat an indication of where they stand
Hmm
Can anyone shed light on how hot the market is right now? Presuming it’s not as hot as last year but is it still good I’m hearing.
Associate
What practice area
Hmmm
Corporate M&A / Private Equity
Associate
Cooling slightly compared to last year or so with global deal volume decreasing. Still opportunities out there though
Anon
Restructuring
Pants
Wait until the recession and then you’ll be sorted.
Lady who restructures
Restructuring is dead at the moment. Latham/Milbank/Links are super quiet and same for the majority of other US and MC firms. That said, some firms are gearing up so the teams are growing, however there isn’t enough work going around right now.
Mike can you please stop using my mug.
Slaughters made a submission by preemptively raising to £115k.
I believe one of the SC or others in the 107K crowd will overtake Slaughters in pay very soon.
Bingus
Funnily enough, one of the partners (during the firm-wide address on pay) told the entire firm that FF can afford to go to 125k because they are somewhat different to the rest of the MC in terms of their business model (probably alluding to FF being more ‘US’ than the other MC firms). No doubt they were banking on the rest of the MC to also raise to 115k…
Hopefully now that CC has gone to 125k, other MC firms will follow suit and Slaughters will have to (once again, reluctantly) raise to 125k.
Bewildered first year student
Are getting TCs like hunger games?
Watchyourback
Pretty much. Less so if you apply direct as you mostly just meet members of the firm, but on the vac schemes (yes, even virtual ones) the knives definitely come out.
Senior associate
Lol if I saw a vac schemer trying to sabotage another one, I’d go way out of my way to make sure they don’t get a TC. “Backstabbing” is for shet tier US firms, not professional outfits.
Anon
Yes and it doesn’t stop there. Same with trainees competing for qualification spots and then again between senior associates for the most lucrative apple of all – equity partnership. Even among junior associates there is competition for bonuses, popular matters etc. Nature of the beast – be wary.
True
Totally agree ^. Kind of a sad industry really. Yes people striving for the top will always be competitive, even in something naturally altruistic like the healthcare sector, but it’s the money on offer in corporate law that brings out the worst in people imo
Anonymous
Funds
Kirkland NQ
Kirkland are hiring – hmu
Anon
Very true – I agree
Bob
I also agree.
So much so that I’d like to draw your attention to it
plum
CC will likely have 10k increments between PQE as they and the other MC currently have, and as FBD do now.
Not sure people understand tax. Between 100-125k you lose personal allowance, and are taxed at 60% – to mitigate this, you put up to 40k (including 5% of which being employer contributions) into pension tax free. So at 125k, you should put 25k, plus 6k of employer contribution, into pension, and get taxed on the 100k, and tax home 66k. If you don’t put the 25k in, you end up with just 74k, i.e. 8k more after tax.
What you’re doing is postponing the affect of tax, which will then hit you after c.£135k-£160k, which is where most US firms have their NQs-1PQEs at the moment. That is, the salary differential between them isn’t as magical as you might think i.e. at £150k, you’re looking at 88k assuming no pension, or if you use pension to £40k, you’ll end up with £78k net i.e. 12k more than £125k gross.
I doubt silver circle and the chasing pack will go further than £110-115k, but they also tend to have 5k increments between PQE, rather than 10k.
You also have to think about the long-term in your practice area. A lot of people seem to be pretty savvy about partnership being so far away, it’s not realistic to have that in mind; rather, it makes sense to pocket as much cash as you can, and people have historically have had in-house in mind, but nowadays few in-house options are keeping up with salaries in PP. People b1tch about Slaughters and the salaries, and they still have this old school partnership mentality where people have to work for them for 8-10 years before they makeup. But a friend from school recently got made up there. All equity. Over a million a year I’m sure. It upsets me.
I do think it’s better to stick to Travers Smith or Macs if you’re relatively happy for a lawyer, leaving typically around 7.30 with people who just about register as human beings. Rather than going to K&E churning until 10-11 every night, working most weekends, with often unrealistic expectations from nice but stern partners and living and breathing PE for 2-3 years until leaving. But it depends on your practice area and partnership prospects in the market.
anon
Leaving at 7.30pm at Travers Smith and Macs? No chance
B
No chance? Of course there is a chance fresher. Depends on practice area. You think US firms don’t leave at 7.30 or even before then at times? There are peaks and troughs particularly with transactional. Advisory or lit seats will have more consistent hours where 9 – 6/7.30 is normal but then have the odd crazy hours.
Anonymous
Cya
I love law
I love law so much I don’t care what money I earn. I just want to be mentally stimulated and to consistently be challenged :)))))
Temple Tube
So much excitement over such small differences in pay. Very grubby.
Anon trainee
Interested to get people’s views on how the ongoing pay-war may affect the number of NQ positions available at US/MC firms? (if NQ salaries become unsustainable in the next few years, will firms react by making less NQ positions available rather than reducing their NQ rates).
Would also appreciate if anyone can shed light on how firms have historically reduced NQ rates in economic downturns or after financial crises. If an MC firm reduces its NQ rate, would the rest of the MC follow in the same way they do when NQ rates increase?
Associate
Not many LC readers were around then. Had a quick google myself and not hard to find the information. You’ll not go far with those research skills 😉
Dicker
CC 5PQE pays £155k +10-15% bonus. Elite US pay (Kirkland, Latham and PH) at 4PQE is around £215k + £40-55k bonus.
It’s no comparison – time to jump ship!
Bob
Elite US has paid significantly more than MC for a long time.
I’m not sure why CC giving decent pay rises is the stimulus for someone to move.
Anonymous
(1) If CC has matched, FBD, 5PQE is 165k and 102k bonus if meeting 1800 target hours.
(2) The figures cited re US firms are not accurate. I believe PH is shy of 200k for a 4PQE, for example. Nor do the US firms all pay the same. Also the bonus condition for PH is 2000 hours. I cannot recall K&E although they officially say I think they don’t have targets, I think effectively you’ll be doing 2k+ for the bonus.
(3) At 5PQE, you’d be mad to leave CC for Latham etc. If you want to stay the course to partner and you’ve survived until 5PQE, it’s going to be much better at CC as an internal. By all means, if you’re a NQ at CMS, go qualify at Kirkland and take the money. But when you’re a senior associate eying up partnership, going to a shop which might kick you out anyway on performance after a year, or kick you out after 2 years because you’re too senior, or where there’s zero chance of partnership is crazy. The money really comes at equity, not pretend partner or counsel even at a US shop; if you’re into stacking up money you’re not going to use, that is.
Beauty n the beast
PH pay £208k for 4PQE (since March 2022).
Busty associate
Can confirm that elite US pays between £240-260k (Akin and Goodwin) for 5PQE. You’ll have to make it to salary partner at a SC firm to make that kinda money.
You're not busty, remove those tissues
Well that’s just not true is it. Macs partners are probably taking home 900k a year post tax.
And even Ashurst/Travers partners are likely still on 600/700k minimum.
Ley
Are you thats not equity partners?
Surely salaries partners are not taking home that much post-tax at SC level ….
Insider
My cousin is a SC partner and can confirm it pays £280k first year. Less than £350k till third year but afterwards can go up fairly significantly if you’re a high performer.
Definitely not £600k min for salary partner. Stop spreading false information.
Trainee but not really because I worry more about my bills than my work
Will Simmons raise? I know they recently raised NQ to 100k but us trainees need loving too pls and NQ needs to go higher with the market no? Any word from the inside?
Young Tory
Stop worrying. Wear a jumper, cook your own food, cut the drinking and maybe even forgo a holiday abroad. You can even work longer hours to save on heating and food costs.
GreenerPastures
Lol, good luck with that. Ex S&S’er here- they ain’t giving you shit until they’re absolutely forced by circumstances. Better tactic is to get an offer elsewhere and if you like S&S, let them know you have an offer on the table and you’re willing to walk. Then they’ll talk; this is literally what a senior partner gently told me when I once asked for a pay rise and outlined the good work I had been doing/value I had added.
Disgruntled
CMS
Anon
Can’t even believe CMS haven’t said something about regional salaries
Come on
Man the CMS commenters on here really like to moan.
A year ago your firm paid £75k. Then it went to £82k. Now it’s gone to £95k.
How can you be disgruntled with that? CMS was never on MC level so i don’t know why this article has disgruntled you.
Anon
Comment above was about regional salaries which are 10k behind competitors but great job summarising the London nq changes
Anon
Any danger of NRF putting up their NQ salary from 95k..
Lol
Nope cos NRF suck lol
NRF Partner
Confirmed
Anononon
Lol @ ‘lit lawyers have better hours’ myth – definitely someone who hasn’t ever done it
response to Anononon
But objectively they do have better hours than transactional lawyers because they are complying with court deadlines/delays etc. So, what’s your point?
Onlooker
A&O, Links?
Smith
Wait until July for A&Os new numbers
Mula
Considering CC won’t lift this up till 2023, who cares. US firms are still better if you want the mula #cashisking
Anon
They have done it retroactively from May this year.
Bob
This is a lie, it is retroactive from May 2022, paid in June 2022.
Lol
Hold the 📞 since when was TW on 95k for NQs?
Where’s the source?
Associate Alan
Great for CC NQs albeit the net increase in pay won’t be very large given the tax you pay between 100k-125k
3PQE traitor
Elite US firms are just better than MC firms in every way. Summarised below are my observations, having worked at both US and MC firms.
US firm: More work + lean team (therefore better practical experience), generous pay (to afford the £4000 flat in Chelsea and £300 dinners), remarkable career progression (less people, access to the US market), long hours (again, better training).
MC firm: Hierarchical (SA does all the work/associate does proofread/printing), lower quality work than US (panel bank work, churn out LMA precedents for mid market deals), less pay (Zone 4/5 flat in a not-too-safe area), in-house canteens/cafes (but shit compared to general meal allowances at US firms), near-zero partnership prospect unless you’re (1) white male; (2) speak like a BOJO; (3) Oxbridge graduate.
SC/West end firm: Forget it. Aldi is your friend.
CuriousCat
Interested to know what conversations are going on at NQ and junior associate levels in HSF… any insiders?
Anonymous
Any updates on Links??
Comments are closed.