RollOnFriday has been calling on firms in the UK to guarantee full pay and job security for their staff for at least a month to help employees during the coronavirus lockdown.

Those which do are anointed Lockdown Champions. Firms which won't go that far, but confirm they have no plans to do so, get to be Good Eggs. Firms which cut staff pay or introduce redundancies in the first weeks of this crisis are tarred with the title of Virus Villains.

Burges Salmon is our star of the week and joins RPC as a Lockdown Champion. The Bristol firm has taken RollOnFriday's one month pledge and confirmed it “will not be cutting salaries or jobs as a result of COVID-19 before the end of April". Kudos to it. 

Also deserving of a cape is Woodfords. The firm has just emailed all staff to confirm that they will be paid in full this month and the position will be reassessed in May.

Lockdown Champions

RPC

 

Burges Salmon

Woodfords


Pants man

Clean pants for all.


Other firms have emerged in the middle category of Good Eggs. They weren't quite prepared to pledge anything, but made the right noises while preserving their position. “We have made no plans to cut our employees’ salaries or introduce redundancies," said a Pinsent Masons spokeswoman. "Like very many organisations we are looking at how we can be helped in that by accessing the benefits of the UK’s job retention scheme and similar schemes in other jurisdictions." 

DLA Piper also gained Good Egg status. A spokeswoman told RollOnFriday, "we can confirm that have not put in place any measures which cut jobs of our employees nor have we put in place any measures to reduce their current salary levels, and have no plans to do so at present."

Macfarlanes is in the Good Egg basket. “The firm is financially robust," said a spokesperson. "We will support our people and our clients through the uncertainties of the months ahead".

After reacting early in the crisis when it had to close its office, Baker McKenzie is a Good Egg. The firm said it doesn't have plans for redundancies or pay cuts.

Clifford Chance is an undercover Good Egg. Although it declined to comment, insiders tell us that the Magic Circle firm has no plans for either redundancy programmes or salary reductions at present.

Norton Rose Fulbright is adopting the same approach as it did in the financial crisis. It is asking staff to volunteer for the possibility of getting their pay cut by 20% for the next year, with a commensurate reduction in their working hours. 

The sign-up process will take place during the next two weeks, and a spokeswoman said that "if the requisite percentage of 75% is reached to make it economically viable", the programme will begin on 20 April.

The firm is also cancelling all bonuses, salary rises and deferring April's payment of partner distributions. In addition, "All non-business critical spend will be reduced or deferred for the foreseeable future".

EMEA Managing Partner Peter Scott said, “In this current crisis, we believe it is prudent to take pre-emptive action to protect our people and our business. The key for us is to ensure that we can respond rapidly to any future changes in levels and types of work at an unprecedented time for the global economy".

“We know this is a challenging time for all of our people and we want to safeguard jobs as far as possible". He added that the scheme, called 'Flex' rather than 'The Lost Fifth', "worked exceptionally well for us a decade ago, which is why we are proposing a similar flexible working strategy aimed at keeping our workforce intact". 

Good Eggs

Travers Smith

 

CC

Macfarlanes

 

DLA  Piper

 

Pinsent Masons

 

NRF


Good eggs

Those boxes aren't to clear desks into.


Watson Farley Williams is furloughing “some” roles "based on reduced activity and/or reduced need for certain roles resulting from a switch to remote working", but it is topping up "virtually all salaries" with "a focus on alleviating financial hardship for those on the lowest pay." He added "we are not planning any redundancies". Critics have asked whether firms should be using taxpayer cash at this early stage rather than their own resources, and it’s unclear why not all staff are having their pay topped up.

Some firms have not cut pay but are freezing salaries. Fair enough in the circumstances, no one can really expect a raise at the moment... Allen & Overy confirmed it had cancelled its upcoming annual salary reviews, and was deferring half the bonus due to staff until October. But A&O's partners are also being required to tighten their belts. The firm is cutting their profit distributions and increasing their capital levels. A&O said it was also "deferring" investments and recruitment.

Offshore firm Mourant denied it was freezing salaries. "We are pausing non-essential recruitment, deferring our salary review process until July (we have not frozen salaries) and paying bonuses for last year in two instalments rather than one", said a spokesman. Which sounds very much like salaries are being frozen. A source complained to RollOnFriday that splitting the bonus could result in them not receiving the second part if they are made redundant later in the year.

Elsewhere, other firms are already wielding the knife with indecent haste.

Regional firm Ashtons Legal confirmed that it was putting just over 25% of its staff on furlough, including reception and administrative office positions, and it was cutting pay. All staff earning £35,000 or more "are being asked to accept a pay cut which ranges from 15% for the majority of staff up to 30% for the highest paid staff for the two months of April and May," said a spokeswoman. At least the partners are also taking a hit. Equity partners' drawings are to being reduced by 30% for the same two month period.

Ed O’Rourke, Ashton Legal's CEO, told RollOnFriday, “the sooner we can all get back to normal the better but until we see how the situation develops, and how our marketplaces are affected, we are taking prudent steps." 

US firm Cadwalader, Wickersham & Taft is cutting pay for legal staff and senior administrative staff by up to 25% for an estimated period of four months, according to a report by Above The Law. Other administrative staff with salaries under $100,000 will have their salary cut by 10% for the same period. The firm, which has an office in London, will also pause the distribution of partner payouts.

Virus Villains

Ashton Legal

Knights PLC

Fieldfisher

Brethertons

Cadwalader


Krang

A firm reveals its true self to staff


Firms willing to make the One Month Pledge should email us at [email protected] If you're an employee, let us know where your firm stands. Are they a Good Egg or a Virus Villain?

Tip Off ROF

Comments

One of the villains 03 April 20 09:16

Anyone who thinks firms putting staff on the furlough scheme are villains really need to think long term.

Law firms, like many businesses, do not sit on mountains of cash reserves. Furloughing staff and cutting pay is the best way to protect as many jobs as possible so we can come back together once the situation improves. 

The alternative? Continuing full pay and go out of business very quickly leading to redundancies for everyone. 

Should big companies like Virgin be allowed to furlough staff. No, not if they are cash rich. Perhaps if the government had more time they could have created eligibility criteria for businesses based on their cash reserves. They didn't so some businesses are clearly taking advantage of the scheme. 

On a personal note. I've taken a pay cut which will cause me financial difficulty but I'd rather some pay than none at all. 

Shipping magnate 03 April 20 10:19

WFW sent an email informing staff about the furloughing only after this article was published. Transparent

MOP 03 April 20 10:25

Interesting times for A&O associates. Even in good years when billing comparable hours, A&O  bonuses do not even come remotely close to closing the gap with competitor US firms, which associates are told is the trade-off for the business being “sustainable”. Yet A&O is the first large large firm to act. I would imagine this response could lead to real associate retention problems in the future as (for now at least) US firms are seeming to weather this crisis better. Magic circle associates never win - in a good year reward is relatively stingy (compared to the likes of US competitors) and in the bad years partners are quick to share the risk with associates (in my opinion, only partners benefit from the pay freezes being announced now as the band adjustments aren’t typically announced for another three months and are typically small except for the headline NQ salary anyway). Time will tell and I will take this comment back if all the LW and KE finance associates are gradually made redundant....

Anon 03 April 20 10:35

Some people need to get a reality check.  Not having a pay rise when you are already earning a lot of money is quite frankly a luxury compared to millions of people who are not getting paid AT ALL and whose businesses are collapsing.   I can not believe that there are some - eg the poster above about A&O) - who fail to appreciate the gravity of the situation and that nice to have debates about US firms v MC firms etc now seem very petty.  People are dying like flies, millions are facing unemployment, the economy is very likely to go into a catastrophic recession and at best we will be facing austerity for decades, and some people are still complaining or focussing on pay rises whilst nurses and doctors are in the front line. Only this morning a mother of three in her thirties with no health issues died after contracting the virus whilst caring for others.  It’s so unedifying for some lawyers on here to whinge about small pay cuts or not getting bonuses or pay rises and it plays to all the bad stereotypes about city lawyers.   Get a grip FFS. 

MOP 03 April 20 10:45

@Anon - This is an article about the responses of various law firms to the CV-19 crisis on a law firm gossip site....

Anonymous 03 April 20 10:50

To MOP at 10h25: from an A&O associate's perspective, I'm actually impressed by the A&O response. All staff are being kept on, with no pay cuts. Associates' salaries are about to go up in accordance with their PQE level. Bonuses are still being awarded. There are simply not going to be additional salary hikes (which in any given year, are not guaranteed in any event. And in my view, they would be stupid at this time). I think it's good the partners are going to be contributing more financially to secure the firm's financial wellbeing, and I don't see how they can be regarded as "sharing" the risk with the associates. From a financial perspective, I think we're some of the luckiest people in the country at the moment. As an aside, I also think A&O has been making huge efforts to help staff on the mental wellbeing front.

MC Mid 03 April 20 10:52

@ Anon 10:35

Yet I will have billed over £1m this year whilst the partners have drawn on average around £1.7m in that time.  Then something happens and it is me that doesn't get a (relatively modest in the grand scheme of things) payrise or bonus this year?  Especially the bonus - it should be backwards looking not forward looking and accordingly the partners should take the hit so it can get paid (who earn 17x what i do, off the back of my hard work)?  

Anon 03 April 20 10:57

@10.52

This is called “the law firm model”.  Firms are the partners - the employees are disposable.  

Covided 03 April 20 11:07

Partners take the risk on the business. As I understand matters partners at A&O and elsewhere are taking substantial drawings cuts and/or contributing more capital to prop up their firms, and ultimately risk losing their capital if the firm fails. Do the deserve sympathy? Not at all. But they do have downside risks as well as upside benefits. And ultimately if they mistreat associates, off they will go...

Mr. Knuckles 03 April 20 11:09

It’s the end of law as we know it. Staff get screwed first then when things finally get to a critical point the partners get cash called then it collapses and staff lose their jobs and partners lose their capital, distributions (if any), and tax reserves (if not already spaffed up the wall as working capital), plus any liabilities that may have been assumed and guaranteed by the partners. Firms on an accruals footing with large amounts of debt and lots of WiP will suffer the most. A mess. An utter mess.

MOP 03 April 20 11:18

@Anonymous - good to hear your perspective. I think myself and other poster are probably not too far apart. We are all grateful to have jobs - my point is that firms that weather the storm better will be perceived in a more positive light when the dust settles, that shouldn’t be controversial. IMO partners on million pound plus incomes acting so soon to freeze the much smaller salaries of their staff who have been getting utterly flogged for the past few years and now have completely uncertain futures is far more questionable and plays exactly to the negative stereotypes of city lawyers the poster has described.  Some of the working conditions at these firms are borderline inhumane and the partners have benefitted immensely from this, so it’s disappointing to see an announcement come so soon when there was no need I can think of to do it (given the usual timing for announcements).

Anon 03 April 20 11:51

Two things:

1) This whole concept of goodies and baddies is misconceived, criticising firms for taking prudent steps to preserve and protect their business in extraordinary times is unfair - highlight those who have acted really badly, but you don't seem to be doing that, maybe because there aren't many? Praising highly profitable firms for not immediately taking steps such as furloughing staff and damming others who have done so is naive. 

2) MOP @ 10.25 "Magic circle associates never win" - get a grip. They have chosen a life of hard work and extraordinary pay. Most could (in normal times) take a better work life balance for less money at the drop of a hat - being in the top 0.1% and comparing yourself to the top 0.01% is pathetic. Look at just how much the rest of the country is struggling. 

Zhukov 03 April 20 11:54

@shipping magnate - one will find that withholding information is often a sign that a firm has serious issues behind the scenes and is trying hard to project a picture of fiction.

Anon 03 April 20 13:02

Everyone knows the deal and can resign and do something else - in law or out of it - if they don’t like the working culture in big law firms and in fact are pretty marketable.   It can be de humanising but the money and “prospects” that are offered are either enough to compensate or they aren’t.   What you shouldn’t do is to complain about the deal when you know fully well what it is before and during it.  

MOP 03 April 20 13:14

@Anon, I think all associates I know are very grateful to be in this position at the moment, we are all aware how much the rest of the country is struggling and are thankful for that. My two initial points were to point out that the actions taken by A&O do not align with the messaging that have been given previously by management and that firms who support their stuff better during this time will be more desirable employers going forward.

My comment didn't contain a criticism of the fact there is no pay rise, I only mentioned the timing of the announcement and the inconsistent messaging. You seem to want it both ways - you say "people are dying like flies, millions are facing unemployment, the economy is very likely to go into a catastrophic recession and at best we will be facing austerity for decades" ; while you see no issue with the partners finding time to announce pay freezes months before they would normally sit down to make that decision, you think questioning it is way out of line and makes the profession look bad? I think pay freezes are reasonable but I also think it is fair to question the decision given the position of law firm partners and that neither of these things make the profession look bad.

I don't follow the logic that because associates are privileged vis a vis the rest of society (and unquestionably they are) they are not allowed to question their vastly more privileged employers. 

Overall I get the feeling you are more interested in defending partnerships than with matters like wealth inequality. Otherwise I do not understand why would you not agree that partners should do whatever it takes to protect their staff given they are vastly more well-off than their staff  - as another poster has pointed out partners earn many multiples more than associates and I would add that today's equity partners have undoubtedly benefited from the generational wealth inequality that associates in the 23-30 something year old age bracket have been disadvantaged by vis-a-vis previous lawyer generations. 

 

MOP 03 April 20 13:28

@Anon - I want to make it clear that if the A&O partnership have indeed assured staff there will be no redundancies or pay cuts, then I do not see any problem announcing there will be no salary adjustments now and that is a win.  This information is not in the original article and was not posted when I commented.

 

Anonymous 03 April 20 13:56

When my wife went into the antenatal ward a few years ago, one of the midwives who attended us revealed she'd been a competition lawyer at Eversheds up until the credit crunch, when she took the "opportunity" it offered to retrain. I've often thought about that since, and I now wonder whether I too am about to be offered the same "opportunity" and, if so, what I'll do.  

Anon 03 April 20 14:58

@MOP

A number of different issues arise but your post at 03 April 20 10:25 was discussing pay rises / lack of parity with US firms and wasn’t qualified by recognition of the points you then later accept about being fortunate, whilst others die or struggle.  It came across to me - and possibly others - as focussing on the wrong priorities in the current climate. In particular, your  phrase “magic circle associates never win” was glib, self indulgent and suggested, again, that what is important is money and self interest at a time when the country is in crisis.  Whether you are earning £150,000 as an SA at a MC firm or £230,000 at a US firm, right now it is unedifying to be complaining.   It demonstrates the lack of perspective that some city lawyers have and the preoccupation with money.  
 

As to the position with firms’ attitudes, it is entirely foreseeable that they would act in this way in order to protect partners’ interests.  As has been said above by someone else, this is the deal - you take your money and you take your chances, or you can choose to leave.  
 

 

Anonymous 03 April 20 15:13

I'm at a (slightly) boutique insurance firm. Couple of offices in UK and one overseas. 

Facilities team has just been furloughed.  

Anonymous 03 April 20 15:22

And Walker Morris (once firm of the year) slips its Brutus moment from last week under the radar.

Anon 03 April 20 15:33

Taylor Wessing has fired all research assistants with immediate effect. Juve in Germany reports at least 95 layoffs.

French 03 April 20 16:15

Funny how people dropping like flies doesn’t seem to stop the 10pm emails asking for emails to go out and mountains of comments to be turned overnight...

Getreal 03 April 20 16:41

Stop your moaning, please. Go and work in Asda if you don't like it. Lawyers blame everyone. Step up or shut up. 

MOP 03 April 20 16:59

Ironic how you accuse me of focussing on the wrong priorities while you defend multi-millionaire management against a mischaracterised complaint, among the reports here of whole teams losing their jobs. 

Law firms need to be very careful of their reputations and how they are seen to be treating staff right now.  The "that this is the deal" argument is a risky one in the context of the issues about bad behaviour the profession has faced in the last few years, and everyone who's worked in a city firm has a story of one kind or another.  Look at what happened in Australia this year, where top law firms were found to be paying junior associates below minimum wage for the hours worked.    When things turn ugly, I think you will find that the public at large is not on the side of large law firm partners blaming the greedy associates  - I'm reminded of the tweet "I have 100 mars bars in my fridge and my mate has 1 in his. I pressured him into giving his to a homeless person. This is how celeb charity appeals work". The public is onto this deflection.  If you don't believe me, sort the comments on this article by recommended  https://www.ft.com/content/aba236e3-d07d-4fdc-b309-e44909ff0f6c

Anon 03 April 20 17:41

@ Getreal 03 April 20 16:41

Just shows how out of touch you are. Asda aren't recruiting any more!

Anon 04 April 20 07:52

MOP - classic straw man there.   I’ve not defended these firms and if you bother to read the detail I’ve agreed that working conditions can be inhumane and the partnership model is about self interest.  The point is that this culture won’t change, not that it’s justified.  Given it won’t change and given that everyone knows or should know what they are getting into, it’s not reasonable to complain about it particularly in this current climate where you are better off than most.   Even for poor little MC lawyers who “never win” - I’m sure the thousands of nurses in the front line, who are exposed to illness and death, and who are paid a pittance, and who do it without complaint, must have tremendous sympathy for those who are earning £150,000+ but who feel so terribly undervalued because US firms pay more.  The obvious response would be go and work for a US firm if it’s that big an issue, and also to get a sense of perspective.  

Anonymous 04 April 20 09:30

I wouldn't be too quick to laud those not cutting salaries/furloughing this month. We can't risk a further slump in morale amongst the retained staff when its year end can we?!?  

Wait for 1 May and see what happens then.

 

PeteM 04 April 20 10:10

At NRF the talk is of 'sharing the pain' and 'making sacrifices". I'm sure the dead wood will sacrifice the ski trip or funding Tarquin's Gap Yaaar. While the wretched masses on the tools feel the pain.

If only the Firm had a few quid in reserve and had not dropped a wedge that could choke a donkey on the SAP fiasco, the Accenture debacle or each and every consultants who had both hands a map and a compass were unable to locate their ar$e . 

Lawyer 04 April 20 12:53

It is understandable for partners to cut back on salary expense in these extraordinary times - but what is withheld now should be repaid to lawyers and staff when the good times return - which they will $ - and no harm telling employees that is what will happen

A Non 04 April 20 17:25

The vast majority of mid-tier firms who have accruals-based accounting live high on the hog while running on fumes with the thinnest of capitalisation and next to no rainy day funds. It’s when something unexpected happens (like Covid or if there is a mass exodus of star billers) that the Ponzi scheme comes undone. While the partners suffer if a firm collapsed they usually have their own personal rainy day funds so they can fuck off back to their Home Counties homes and ride it out - its the worker bees who get properly shat on financially and their careers derailed/terminated at the worst time. The financial year end for many of these firms is going to be interesting to watch as management and partners scrabble around to give the numbers a proper massage (Most likely without the happy finish).

Common Sense from The University Of Life 05 April 20 09:41

I don't know what you lot are whining about.

I survived a Sharknado.

In itchy pants.

ussolicitor 05 April 20 09:58

@MOP and others talking about US firms weathering the “storm” better than MC firms: this is simply not true.

US firms have an arsenal of weapons at their disposal to get rid of staff across the board - it is what they’ve done for years and years. US firms will come out and say this because it has backfired after some have done it in 2008/09. Why do you think about +70% of the salaries partners made up at certain US firms no longer work there - have you ever seen these firms come out and say that they’re making all these partners redundant? Of course not! They will say the opposite and that it is an extremely supportive and collegiate culture, etc. Yet the number of departures speak for themselves. I can tell you from personal experience that US firms have already put the wheels in motion and are already in the process of reducing head-count (over the past weeks) - the culture at high-paying firms is one where they will not “wait and see” and will jump at the opportunity to cut costs.

Realist 05 April 20 11:09

I can’t believe people have given a thumbs down to 3 April at 10.35. I am a lawyer. My wife is working on ICU today (Sunday 5 April) and she is witnessing people die every day. This includes a colleague. Get a grip people. Get a bloody grip. Lawyers are in my experience very self centred and see themselves as one better, entitled, worthy. We ain’t mate. We die the same as anyone else. Just not quite as loved. 

Anonymous1 05 April 20 12:38

In making my comments, I am very mindful that there are people who are risking their lives to help others, who are losing theirs through no fault of their own as part of this crisis.  I think we all need to keep this top of mind.

However, we also need to recognize that law firms, like other businesses are commercial enterprises, who due to poor historical leadership and a lack of sensible business planning may now be strapped for cash and unable to borrow to cover revenue gaps. 

The challenge I have is with those firms asking people to take temporary pay cuts. I feel they are making an easy short term choice and missing an opportunity to make some necessary changes. Whether we like it or not, this is an opportunity for firms to make some difficult choices, to do some essential restructuring and deal with underperforming partners, lawyers and business support staff and outdated infrastructure so that they are in a much better shape in the future.  

I’m not sure how happy many would be to 'share the pain' and 'make sacrifices’ for fellow employees who we know should have been asked to leave a long time ago.

Anonymous 05 April 20 14:31

@Anonymous 03 April 20 10:50

You are apparently an A&O associate who does not understand the pay freeze. You will still roll up to the next grade, but your salary is frozen at your previous grade. Therefore, you can rest assured that your salary is not increasing whatsoever compared to what you were paid last FY. To suggest that you are only missing out on an “additional” pay rise is incorrect. 

Anon 05 April 20 15:15

Realist - all true but but don’t forget the poor little magic circle lawyers because they “never win”.  They only get paid £100-175,000, never have to put their lives at risk, shuffle paper around making money for themselves and others in a career and role they choose to do every day and could leave tomorrow and oh my god some other paper shufflers at Us firms get paid even more!  The horror of it all.  Forget nurses and doctors -   Let’s have a minute’s applause around the nation for the magic circle and other city lawyers, the poor little darlings really must be suffering so terribly.   It breaks your heart it really does. 

US solicitor 05 April 20 15:22

Read this to see how well US firms, a large number of which are dependent on M&A, are currently doing and how many heads are being chopped:

https://www.law.com/americanlawyer/2020/04/02/ma-activity-fell-off-in-2020s-first-quarter-even-at-kirkland/?slreturn=20200305101710

 

Allthesame 05 April 20 19:05

Laughable though is fact that if all the moaners had made partner by now do you think they would extend the grace they now demand. No chance. PP lawyers that get to that level are nearly all the same when it comes to their own self interest and survival. Anybody but me being the prevailing orthodoxy. Grow up and realise no job or salary is guaranteed.  You either get lucky at this time by having enough work to keep you employed or u don't. And if u don't then time to look elsewhere. Brutal but that's the market for you. Just stop crying and expecting your partners to owe u anything. 

Magic Circle Senior Associate 06 April 20 11:05

For a bit of balance to the posts above, I am a Magic Circle Senior Associate. At a time like this, I am enormously grateful that I have relatively stable income. I think it'd be reckless for firms to announce pay rises at any level right now and would play horribly with our clients and wider society.

Bigjanice 06 April 20 18:59

At least I'm getting more tinder time and have set a weight loss goal of 50kg during these times. Every cloud. 

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