Many law firms make a clear decision not to pay bonuses to junior lawyers. However, those businesses instead compensate them with large fixed salaries.
Using statistics from Emolument, which benchmarked the salaries of associates to compare earnings across the UK’s top firms, we unveil the legal companies in the nation that offer great pay packages.
(1) Latham & Watkins
Median salary: 107,000
Bonus: None
Lawyers at Latham earn far more than those at “magic circle” firms the five most prestigious legal practices in the UK and even more than the basic salaries of associate bankers at the UK’s top banks. As a case in point, 2015 saw associates at JP Morgan earning an average salary of 93,000, which was the highest of any bank in Britain.
This is largely due to the fact that in terms of revenues, the firm is the largest in the world.
However,Emolument suggested that while the best compensated bankers get an average bonus of 83,000, for many lawyers including those at Latham & Watkins there’s no bonus of any kind.
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(2) Allen & Overy
Median salary: 79,000?
Bonus: 5,000
In 2015, global law firmAllen & Overy issued a message to magic circle rivals that it would be giving its junior lawyers pay rises of up to 25 per cent.
Along with being handed their practising certificates, freshly minted solicitors at the 1.23bn revenue firm now bag salaries of 78,500 and more, an increase of 12,000. And associates in the year above actually saw salaries rise from 72,500 to 92,000, while those at two years post-qualification experience (PQE) went from 82,500 to 104,500 and three-year PQEers jumped from 93,500 to 115,000.
Allen & Overy is the second largest firm by revenue out of those mentioned in the list and it offers the most competitive total compensation at 84,000.
Read on to find information about three other legal practices giving magic circle pay packages a run for their money.
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(3) Linklaters
Median salary: 71,000?
Bonus: 10,000
Linklaters which is arguably the Citys top training contract provider, offering 110 places annually saw its turnover increase by 1.6 per cent to 1.26bn over the last financial year.
According to Legal Week, the firm saw a boost in pre-tax profits of six per cent to 420m, leaving a healthy sum of over 402.5m to be divvied out amongst its 2,387 lawyers and 287 partners.
Furthermore, May 2015 saw the firm boost pay for its junior lawyers. And while first-year trainee pay saw a rise of five per cent, newly qualified lawyers were given an extra 5.5 per cent.
(4) Hogan Lovells
Median salary: £72,000
Bonus: None
Much like Linklaters, Hogan Lovells bumped up the salaries of its newly qualified lawyers in 2015 by 5,000 to 70,000 in order to match the salary on offer at magic circle firm Slaughter and May.
This “war of the wages” saw a hike that was more than double the pay rise given to newly qualified lawyers at Hogan Lovells the prior year, when salaries rose by 2,000 to 65,000 to make Hogan Lovells one of the top-paying law firms in the City.
While it no longer maintains its top spot, the company still pays its staff an equal amount to those of magic circle businesses.
(5) Herbert Smith Freehills
Median salary: £69,000?
Bonus: 2,700
On par with most of the firms on the list, Freehills pitched into the City salary war in 2015. But while magic circle firms may continue to pay higher salaries for more experienced lawyers than Freehills does, the firm saved its biggest increases for those with two or three years’ PQE to reduce that gap.
Lawyers with two years’ PQE received a ten per cent salary bump from 79,000 to 87,000 and those with three years’ PQE were handed an eight per cent rise to 89,000.
Meanwhile, magic circle firm Clifford Chance was trumped by Freehills, whose median 2,700 bonus adds to its 69,000 salary to push it above Clifford Chance’s 70,000 median salary.
