London Lawyer Pay Increases 10% as Firms Compete for Talent
January 19, 2012, 11:40 AM ESTBy Lindsay Fortado
(Updates with finance job cuts in sixth paragraph.)
Jan. 19 (Bloomberg) -- Pay for London lawyers rose 10 percent last year to 146,500 pounds ($225,800) as firms competed for a limited supply of attorneys, a legal recruiter said.
Average base pay for salaried lawyers in the British capital rose 4 percent to 111,000 pounds and bonuses increased to 35,500 pounds, recruiter Laurence Simons said in a statement. In comparison, base pay rose 2.1 percent in 2011 for accountants, and 1.2 percent for all U.K. professionals, the recruiter said.
Pay and bonuses for lawyers have “been pushed up by the limited supply of talent in their market, making retention the name of the game,” said Lucinda Moule, managing director at Laurence Simons. “A tough 2010 means employers have focused primarily on boosting salaries rather than increasing headcount.”
At least three top London-based law firms raised salaries for lawyers last year after freezing or cutting pay by as much as 11 percent. Clifford Chance LLP, Freshfields Bruckhaus Deringer LLP and Slaughter and May raised salaries and said they would pay bonuses last June. More experienced lawyers that have partnership interests in a firm are paid based on the firm’s financial performance rather than receiving a set salary.
Top U.S. firms still offer higher salaries in London, with Bingham McCutchen LLP and others paying 100,000 pounds to start, to match New York levels. London legal salaries are comparable to entry-level pay at a financial company, without the promise of a large bonus.
U.K. financial services firms eliminated 58,000 jobs last year, more than any other country in the world, according to data compiled by Bloomberg. Employment for London’s bankers dropped 8.5 percent last year compared with 2010 and over the next two years will remain below 1998 levels, according to the Centre for Economics & Business Research Ltd.
The average bonus for salaried London lawyers rose to 32 percent of their salary, Laurence Simons said.
--With assistance from Kevin Crowley and Ambereen Choudhury in London. Editors: Christopher Scinta, Anthony Aarons
To contact the reporter on this story: Lindsay Fortado in London at lfortado@bloomberg.net
To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net
