Lawyers in London who work at US firms are preparing for juicy pay rises after Milbank hiked associate salaries to between $190,000 and $330,000.
In the US, Cravath Swaine & Moore traditionally raises its pay first and the rest of the top-end US market follows. But this week Milbank stole the job. The firm told its 500 associates that from July 1st, NQs, 1PQEs and 2PQEs will receive a $10,000 raise, while 3-7PQEs will receive $15,000 more.
The firm confirmed that it was pegging UK salaries to the dollar, ensuring that its approximately 100 London associates will share in the bonanza. It means that, on the basis of a spot FX rate, the handful of NQs at Milbank's City outpost will be paid around £143,000 (each).
Kirkland & Ellis was one of the first US firms to peg its UK pay to the dollar, resulting in giant pay rises. A rash of other US firms like Latham & Watkins and Debevoise & Plimpton swiftly followed suit. It is highly likely that those firms will now match Milbank, widening the gulf between the US top-payers and the Magic Circle, where impoverished NQs must struggle by on a salary of little more than £80,000. So far UK firms haven't bought into a salary war with the US, relying instead on brand and, perhaps more importantly, their American rivals' comparatively teeny headcounts in the City, and the smaller number of vacancies that entails.
Even before the latest hikes, Milbank associates conceded to RollOnFriday that "around 163k for 4 PQE isn’t bad", but a couple of them grumbled that their firm was "not quite matching" the New York standard. Now it's setting it. An as everyone at each PQE level at Milbank is paid the same, including bonus, regardless of the hours billed, no-one will feel left out. The downside: there’s "still the odd 2am finish to keep you on your toes".