Freshfields has dropped the traditional PQE-based pay system for its lawyers, and will now increase salaries based on a murky selection of "career milestones".

The Magic Circle firm joins a host of other shops which have dropped the old way of doing business - whereby all associates got a pay rise every year, whether they had worked 1,200 or 2,200 hours (or - at Freshfields - 2,200 or 3,200). And so from next May, the firm's career milestone structure, which it developed in 2009, will also determine associates' pay.

In this brave new world, performance - and thus salary progression - will be based on criteria including technical and personal skills, people and team skills, and coffee procurement skills project management skills. However nervous and unskilled associates will be pleased to hear that none of them will be paid any less in May as a result of the new system. And top-ranked associates will get more of what was once paid as bonus as a component of their base salary.

Required reading at Freshfields

The new system seems to be going down well at the firm. Foremost amongst the yea-sayers is surely the trainee who appears in an upbeat and exciting recruitment video on Freshie's website in which she passive-aggressively complains about those trainees who don't accept extra work and go home at 6pm, whilst she stays in the office until 10.30pm milestone-ing away.

A spokesman for Freshfields said "We believe we need to invest in a salary structure that incentivises and rewards individual development...and not just years of service."  Which will no doubt be of great interest to all the Magic Circle associates fleeing to US firms where they can get paid a stack more money for much the same work.