From hot to cold like that.
Allen & Overy has frozen associate salaries after it raised the pay for newly qualified solicitors twice last year.
The firm usually reviews pay in the summer, but in an email revealed by RollOnFriday earlier this week, it told lawyers that "after careful consideration of the market and with economic conditions becoming more challenging" it had "decided not to increase associate spot salaries at this time".
The Magic Circle firm said it would keep the position "under review" (translation: if more City firms raise pay, it will have a rethink).
In the heat of the pay war last year, several City firms including A&O found themselves hiking NQ pay in June and then again in the autumn. In the second round of raises in November, Allen & Overy matched Linklaters after its Magic Circle competitor increased NQ pay to £107,500.
The move suggests the recruitment battle may be cooling down - or at least, that A&O hopes it is. It's certainly not an approach shared by all firms. Clifford Chance announced in May that its NQs were getting another pay rise, this time of 16% to £125,000, matching Freshfields, while Slaughter and May is also currently paying NQs more than A&O: £115,000, and they can bring in their mutts.
£107k is not chicken feed, but it's also over £50k shy of several US firms. They have far fewer lawyers to pay, but the NQs that are employed by the likes of Gibson Dunn, Goodwin, Davis Polk, and Fried Frank are all on at least £160,000.
Allen & Overy has also called off the pay review for senior associates. Associates at A&O are paid a fixed amount at each level, whereas senior associates are paid within a salary band - and those bands will also remain unchanged, the firm has told staff.
Still, they can always collect a bonus. They just have to achieve "95% personal busyness", up from the previous threshold of 90%. Woohoo!
A spokesperson told RollOnFriday, "After careful consideration and consultation we have decided not to increase the London NQ salary at this time. It was last increased in November 2021, to £107,500. This is a prudent decision based on a number of factors, including the more challenging business environment. We will keep the situation under review".