Clifford Chance has joined Freshfields in paying its NQs £100,000, as long as they're good enough for a bonus. 

The firm has broken cover and matched Freshfields, which recently became the first Magic Circle firm to increase NQ pay to £100,000. The move is understood to be an attempt to bolster the firms' appeal to junior lawyers who might otherwise be tempted by the fabulous wages available at US firms.

Clifford Chance's raise from £91,000 to £100,000, however, includes a discretionary bonus. And some US competitors still pay significantly more, such as Kirkland & Ellis, which currently pays NQs a salary of £143,000. But the push into six figures will make its offering more attractive to picky students and trainees, and piles the pressure on Slaughter and May, Allen & Overy and Linklaters. They still pay their NQs salaries of 'only' £80,000 to £83,000.


scorp

With net pay of circa £5,400 a month, Clifford Chance NQs can get a sweet new scorpion chair every four weeks.


Meanwhile, White & Case has raised its first year trainee salary from £46,000 from £48,000, and its second year salary from £50,000 to £53,000. The bump doesn't quite take its trainees past those at some other US firms (Debevoise & Plimpton and Skadden 2nd years are paid £55,000). But it does stretch just past the Magic Circle firms which had overtaken it, putting a few symbolic pounds between White & Case and Linklaters (£52,500 for 2nd year trainees) and Clifford Chance (£50,500).

A spokesman for White & Case said that its London office offered a compensation package "that is designed to be highly competitive in the London market", and that "we constantly monitor the market...to maintain that position".

At the start of the year, White & Case trainees told RollOnFriday in the Firm of the Year 2019 survey that their salaries were "among the best for London and well received", but needed to be closer to top-end US pay rather than behind the Magic Circle. "We had been told the intention was to sit directly in between the two", said one trainee. If so, mission accomplished, for now. 

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Comments

Anonymous 14 June 19 08:14

Except it isn’t “mission accomplished”, is it? 

It’s funny how the media/PR team at W&C have gone straight to the usual media outlets with the news of these increases in trainee pay, but there is no mention here of the fact that associate pay has just been frozen again – as it has been for the past two years. 

The firm bills itself as “Mid-Atlantic” but the salaries that it pays to its associates are now effectively the same as at Magic Circle firms. The firm is getting left behind – despite its claims of record turnover and PEP. There used to be a premium in salary to compensate for the “lesser” reputation of the firm in comparison to its Magic Circle counterparts – “put up with lower levels of prestige, slightly worse work, slightly worse hours, and we will pay you (slightly) more”. That premium has now faded away. 

The firm used to match Shearman, but the fact that it has refused to do so this time is a pretty damning reflection on how the firm’s stock has fallen.

Given the choice, who would really pick W&C over the magic circle, or “proper” mid Atlantic firms ( to say nothing of the NY elite?) I suspect not all that many would… 

I imagine we will see a good few associates looking to leave

Dearie 14 June 19 09:35

I remember a similar silly wages race around 2005-2007 and then look what happened. Setting pay simply by judging your firm to be in same league or not as another firm is a rubbish way to set pay. Pay ought to be set against longer term plans (at least 3 years plus) and paid out against performance under that plan. Any moaning minnies who think the grass is greener are welcome to go and find out. Meanwhile, when the next economic stress hits, a fee earner ought to be more confident that firm can ride it out. Sadly I doubt many firms think this way and treat fee earners as disposable, resulting in fee earners just grabbing what money they can then moving on.

Lol 14 June 19 09:48

Slaughters won’t move any time soon because most of the partners think we’re overpaid, underworked and lucky to be there.

cc 14 June 19 10:02

CC now a bit behind FBD.   Headline NQ figure is 100k, except its really 91k + an all but guaranteed 9k bonus.   1PQE only on a smidge more than 100k base but with a purely discretionary bonus.  FBD NQ base is 100k + discretionary bonus and presumably 1PQE is closer to 107 to 110k + discretionary bonus.

 

Still decent wedge mind. 

Anonymous 14 June 19 10:05

Yes, every associate I know at W&C is livid to say the least with respect to this recent pay move (or lack thereof).  In fairness, they do not expect the firm to come close to the white shoe firms paying at or close to USD spot rate.  But the prevailing view after similar firms such as Shearman moved NQs from 105 to 120 (a level which firms such as Ropes & Gray, Cleary etc pay), W&C should match that, or at the very least implement a raise of some extent as a token gesture (even Cooley is now at 115).  Of course, being the cynic, one might be tempted to suggest that salaries have indeed been frozen to force some attrition of deadwood, but the first people the first will lose are those performing well and billing the hours…

Anonymous 14 June 19 13:11

White and case trainees moaning over their obscene pay has just made me take out my incredibly small violin.  If you don’t like it move in two years to a higher paying firm... if you can. 99% of UK Lawyers are paid less. (Disclaimer... I totally made up that stat)

Dearie 14 June 19 16:17

I suspect your stat is not wrong - if trainees just want to earn the largest wedge then they have begun their own race to the bottom. If they really are that good, I'm sure they'll get their six figures quite easily.

Anonymous 15 June 19 12:12

'There used to be a premium in salary [at White & Case] to compensate for the “lesser” reputation of the firm in comparison to its Magic Circle counterparts – “put up with lower levels of prestige, slightly worse work, slightly worse hours, and we will pay you (slightly) more. That premium has now faded away.'

Couldn't agree more - I would add to that the lack of training and development for lawyers at White & Case.  Some people say US firms just don't offer training but it is not true - true "white shoe" US firms like David Polk and Sullivan Cromwell have great training programmes. Not to mention salary increases at White & Case caps out much faster than Magic Circle firms so a Magic Circle firm lawyer at 5 year PQE or above often earn more than White & Case associates.  Also, a premium should exist to compensate for the lack of promotional opportunities at White & Case given the firm routinely promote lateral partners over developing its own people.  There is also the discomfort of seeing your colleagues and people you work closely with routinely "disappearing" en mass in a cloak and dagger way, as has happened recently. 

realist 16 June 19 21:38

What's that? Someone gets paid 10% more than you for doing the same job but in a rival business? 

WHO DARE SAY WE IN THE TOP 5% DON'T FACE INJUSTICE?!?!

Gonna go complain about this with my law colleagues whilst we rack up a £300 tab of overpriced cocktails at our Chancery Lane pisser.

Great. 18 June 19 14:59

White & Case is hilarious. I work here. I nearly fell off my chair when I learned that we've rebranded as a mid-Atlantic firm. All this time I thought were a (cheap) US firm. The Dodge in the US car market so to speak.