Fieldfisher has failed to pay partners on time for three months in a row, RollOnFriday understands.
It was due to pay equity partners on 11 March but failed to give them their full entitlement, said a source. They said the firm was unable to pay equity partners in full or on time in January and February, too.
Fieldfisher is understood to have dumped new joiners, citing business interruption caused by coronavirus. But sources said the pandemic was a "figleaf" deflecting from longer term problems at the firm.
A source said blame was being directed internally at the reluctance of a key client, a Russian oligarch, to pay his bills in a timely fashion. RollOnFriday has been unable to obtain confirmation from the firm, which did not respond to a request for comment.
The firm has boasted strong financial results in recent years. Profit per equity partner reached £805,000 in 2018/19, almost double what it had been four years previously.
The biggest slice of the PEP pie, "by far", said a source, goes to Managing Partner Michael Chissick. Fieldfisher had an average of 83 equity partners and 111 fixed share equity partners in 2018/19, but during that period the highest paid partner received an astonishing £4.3 million. By comparison, PEP at Macfarlanes in 2018/19 was £1.7 million and the highest paid partner received £2.7 million.
Oligarchese for 'make me pay'.
In position since 2012, Chissick has overseen the firm's increase in profitability and its recent overseas expansion into Spain, Germany, Belgium and China.
When the firm announced its record PEP last June, Fieldfisher Finance Director Mike Giles said, "we are not becoming a total sweatshop to increase PEP numbers". But a source claimed that's very much what's happening now. "The equity partners are leveraging everyone for all they're worth", they said. "And there's no money for BD or anything else".
Lawyers at the firm were scathing in comments to RollOnFriday provided around New Year. "The firm's senior management are ripping each other to shreds in a civil war again", said one. "It's disrupting the business". The culture "is well-drilled from the top down. It is summarised as follows: 'we bullshit you until you catch on what we're up to and leave the firm in disgust, but in the meantime, we get our pound of flesh'".
"I don't know a single associate that's not semi or fully active in searching for another role", said another lawyer. "They think that the quality of the work should be enough for us to stay put, and they are doing us a favour in letting us slog our guts out for hours on end. Hoards of departures from the Regulatory team at the moment over pay and workload". But Chissick "is undoubtedly doing a good job", they added, although, "It would be nice if staff got a share of the recent profits".