Exclusive: Linklaters decides against upping NQ lawyer pay — for now
Magic circle firm stresses pay remains under review
Linklaters has taken the decision not to increase salaries for newly qualified (NQ) associates — for now.
In an email circulated yesterday and seen by Legal Cheek, the magic circle player’s trainee development team informed rookies that a “decision had been made not to increase [NQ rates]” and as far as it is aware, “there isn’t a plan to revisit this decision”.
But a spokesperson for the firm told Legal Cheek: “It is not correct that a decision has been made regarding salaries. As had been communicated internally, we are continuing to review the position.”
The news comes just two weeks after Legal Cheek revealed that the firm — which recruits around 100 trainees each year, the highest intake of any City outfit — had told its young lawyers that it wouldn’t “rush” into matching the salaries offered by some of its closest rivals, “without properly considering the impact of any changes and the wider economic context”.
Trainees are advised “to go directly to their group leader” and “ask whether NQ salaries will be revisited”. The leaders, according to the email, “will have more weight to bring this to senior leadership”.
The Legal Cheek Firms Most List 2022 shows Linklaters and Allen & Overy currently pay NQs £107,500, with the latter confirming earlier this month that it wouldn’t be increasing pay due to “challenging” economic conditions. Clifford Chance and Freshfields both dish out £125,000 following pay increases earlier this year, while Slaughter and May provides its most junior lawyers a salary of £115,000 thanks to an uplift in April.
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28 Comments
😂😂😂
*fetches popcorn*
Interested Party
Too early to say whether this is LL being tight or prudent.
Could be that they have had a look at the pipeline and seen that the ar*e has started to fall out of the market. Equally could be that they are just focussed on PEP. Time will tell.
Anon
Shame on management, they haven’t even told associates this yet and we are finding out through legal cheek. The managing partner said last year Links would be top of the UK market on pay now he refuses to match the likes of bakers or HSF. At the same time they are telling everyone to start being “bold and ambitious” in what they do as part of the new strategy – how is this a way to raise morale for that? There have also been other silent cuts like scrapping the well-being allowance the firm only introduced last year.
Strapping myself in
This article could reach 100 comments for sure 🍿🤣
Smug Real MC member
Stinklaters is done
Keen email see-er
Show us the email then!
Anon
Even worse than a&o because links have had the benefit of time and seeing HSF and bakers go above them and still refuse to match! Is 2 million quid not enough for these greedy partners
Not all about you
They are working on the assumption there is a profit crunch coming. Minimising costs going into that is prudent. Disgruntled junior staff is far less of a business risk to a law firm than disgruntled equity partners losing 25% or more of income.
Anon
So how have their direct competitors been paying more for months now?! They have the same clients and work on the same deals and so far there is no slowdown. PEP is going up across the board on all financials being reported. This whole spiel about preparing for a crash is ridiculous. If there is a crash they will cut salaries and make staff redundant to reflect this. Just like in the GFC and start of covid.
Anony Mouse
Trainee coups becoming more common nowadays, it seems
Anonymous
LL really showing its lack of classiness and ‘prestige’ here. When the US elite ups salaries, its COMPETITORS nearly always follow. Guess Links and A&O are resigning themselves to the bottom of the Magic Circle and below-see Bakers…
LL associate
LL associate here – this is a poor piece of journalism. The email came from a trainee HR rep who said “we don’t know the answer, go ask your department heads”. HR clearly won’t be involved in the decision whether or not to raise pay.
Another LL associate
The email is pretty clear. Stop drinking the Kool Aid
A&O NQ
We should together to the local dumpster. What say you?
Another another Linklaters associate
Is Bakers hiring?
Anonymous
As a LL associate – I haven’t seen or heard of any email. No idea what this article is on about!
Another LL Associate
It was sent to trainee forum reps and circulated to the other trainees. Maybe if the trainees liked you they’d have told you about it.
LL trainee
The email was sent to trainees reflecting discussions with the trainee development team following people complaining to them/asking when we will hear more about salaries, which is why associates won’t have seen it.
Trainee development said that as far as they’re aware there isn’t a plan to revisit the decision on salaries and suggested contacting group leaders if we want this to be raised with senior leadership.
Anonymous
To all you lawyers out there, who don’t wanna be on a MC firm where the pay is frozen…then come to Death Row (US firms)!
Tom
Prudent. As long as LL continue to have outstanding rankings in Chambers etc, they’ll be OK
A counter point
Hmm – potentially but the long term ramifications of behind-market pay isn’t their reputation now – but how they’ll fare agains competitors in 5-10 years time. If LLs’ best associates are leaving for pastures new it could affect the talent pipeline for the next generation of partners
Ford-Driving, Lamboless Lawyers' National Trade Union
Let’s unionize and go on strike!
Old timer
I remember when top UK firms pushed NQ pay up to £66k pay back in 2008. Top paying US firms were hitting the high £90s (Latham on £98k), which was based on a $160k rate converted at a slightly less favourable rate than the prevailing rate of around 1.85 $/£. Ironically US salaries in $ terms haven’t risen anywhere near as much as UK salties in £ terms in the same time.
Anyway, we all know what happened post-2008. Well, for those who don’t, firms (mostly UK firms, very few US firms if I recall correctly) cut NQ salaries to around the £59k level in 2009, freezing salaries at that rate and slowing down progression through bands.
The freezes eventually thawed but even in 2012 an NQ at the MC/SC would be on circa £61k. This was actually less than the NQ salaries being paid at the time of applying for training contracts back in 2007/08 – crazy, right? It probably took another couple of years for NQ salaries to get back to level they were at in 2008 and then things picked up once again from 2014 or so, once firms started pushing NQ salaries towards the high £60s and beyond. And here we are with MC/SC firms paying up to £125k in 2022 – basically doubling in eight years.
It’s very easy to assume that salaries must either remain at these levels or continue to increase, particularly with inflation. But those who lived through the last financial crisis should know that associate salaries are not immune from market downturns. Of course everyone wants to paid the same as, if not more than, their peers, but there is something to be said for a firm taking a prudent approach, especially when we have already seen some heft rises over the last few years.
Finally, when people are 8+ PQE and reflecting on their career, I don’t think they will be disappointed by having hung around for a few years post qualification at Links/A&O being paid circa £580/month less than m8s at FF, CC etc (remember, the marginal tax on income between £100-120k is 60% because you lose the personal allowance). Bigger picture – the wider benefits of good quality work, resources, training etc make up for all of that in the long run. But by all means, if the market doesn’t decline in any meaningful way and Links/A&O don’t up their pay, then go and chase the £££ at UK competitors or US shops. Just remember it’s not the be all end all, especially in the first year or two of your post-qualification career.
Human Resources Department Detected 🚨
okay HRoomer
Anon
Do you really think these firms getting away with paying £20-30k less to associates will cut any fewer staff than FBD/CC if we enter a full blown recession and slowdown in work?
Adrien
They could increase their probably underpaid paralegals’ and other staffs’ salaries though, I think that would be very much appreciated and in line with ESG…
Benty Bonty
Shocking. Wombles will overtake them at this rate!
MC Trainee
We can also shift the focus to the government – why do they not move tax bands in line with inflation? For me, that is the bigger robbery.
Comments are closed.