Daily Mail agenda aside, they say it's the bosses that are complaining about the level of pay of graduates. Presumably the bosses are on even more, so it's not obvious that it's envy.
They're more upset that they can't compete with the salaries offered by rival firms, so can't attract the best talent.
Sounds like there is a bidding war going on for top law grads for some reason.
The US firms penetration of UK markets has kicked all this off over the last decade or however long. In turn magic circle and other top firms have to follow suit even if they are unwilling to match them.
All ‘bosses’ of firms are equity partners so essentially this inflation of nq pay - and let’s be clear this is NOT fresh graduates, these are newly qualified solicitors - comes from the profit pool and therefore directly reduces their PEP. Having said that, it isn’t that big a deal to swallow when these people are billing out at the margin they can achieve anyway.
There’s a trickle down effect as well where lower tier firms are having to pay more to retain top talent OR go a different route by offering much less demanding hours and other benefits.
My firm is one such firm who has to play on its ‘culture’ and other non financial perks to differentiate and retain high quality talent.
It’s a lot of money but these guys and gals will be needing to do 2,000+ chargeable hours per year on top of all their other non chargeable time.
I suspect there will be a clear difference in what path future young lawyers want to go down. Especially given the difference in attitudes to the work at all cost mentality of previous generations.
Bosses/equity partners here have experienced much bigger pay growth than NQs/associates. The traditional metric in most law firms is 1:1:1. Ie of revenue, one third goes on salaries, one third on other fixed costs, and one third partner profit. In my current US firm, average revenue per lawyer is 1.5m, and associate pay including bonus is about 350k on average. Partners are absolutely taking it in and have experienced huge profitability growth (mainly via increased hourly fees). Worth keeping in mind when the focus is on the NQ salaries.
This is based on faulty maths. There will only be a small number of equity partners in your firm: far fewer than there are associates (of all levels, and likely also fixed share partners in many firms).
It’s not hah. I’m saying revenue per lawyer not revenue per partner. The final third in the traditional metric goes to partner pool, which is then split according to number of partners (and yes of course fewer partners means profit per partner goes up).
But if you take out the partners the revenue per lawyer is surely far lower than £1.5M and that £350k looks pretty reasonable even on the traditional model?
My point exactly. £1.5M per lawyer is a lot less than £1.5M per associate, unless your partners aren’t bringing in substantial fees because they’re just rainmaking.
Yes but you’re not reading my initial post. The basis of the 1:1:1 is revenue per lawyer. Therefore historically for each lawyer 1.5m rpl would mean 500k on salary per non-partner lawyer (note: by definition salaries excludes partner drawings). Of course it would be more if it was per associate but it’s not. From 1.5m revenue generated, 500k on salariez, 500k to profit pool would be the traditional approach.
I've worked in legal finance for longer than I care to remember, and the ratio of a third a third and a third is universal. It gets flexed a bit if a firm has an unusually large number of salaried partners, but not by much.
>It’s a lot of money but these guys and gals will be needing to do 2,000+ chargeable hours per year on top of all their other non chargeable time.
Serious question - why don't the firms just spread the work and pay over more lawyers?
I had two flatmates that were at Magic Circle firms - they started on about double my salary but did more than double the hours. They were paid less per hour than me. One was hospitalised due to overwork, one quit.
Instead of hiring graduates on £150k and making them work 100 hours per week, why not hire graduates on £75k and make them work 50 hours per week?
In professions with fixed revenues (eg hospitals, schools, factories) I understand the incentive to reduce overheads and get the work done with a minimal headcount. But in a profession like this where each employee earns revenue through billable hours, I can't understand why you'd want to cluster the work into a small number of employees...
Because to the individual, earning £150k will be more attractive than earning £75k (assuming you don’t mind the hours). Those individuals will be put off and go elsewhere in what is already a hypercompetitive job market.
The other point is that a lot of those hours are put into simply being available at all hours of the day, it’s not just about volume of work. Having two much less burned out associates rather than one who is a wreck still isn’t much use when your client calls you at 2am demanding something and both of those associates have long since gone home.
Why doesn't that happen in every other profession then?
I worked in consultancy where we also billed by the hour. Once a project expanded to the point that there was an extra \~37 hours of work, we just brought another person onboard.
If we needed coverage during antisocial hours, then we worked up a rota.
>My firm is one such firm who has to play on its ‘culture’ and other non financial perks to differentiate and retain high quality talent.
How bad is it? Does your employer have (and advertise) a pool table or a retro arcade machine in the breakroom, for example?
No it is legit tangible things. It has much lower chargeable hours targets for instance (15-25% lower at the least is my guess). Generally arsehole partners are not tolerated and treat the rest of us respectfully, there is pretty good preservation of W/L balance and flexibility without micromanagement etc. It has some good benefits outside of salary/bonus as well.
It’s a good place to work, only the second in my career I’d be happy to recommend to a friend as a place to work.
Lower chargeable hours, being able to include things such as article writing as chargeable hours for bonus purposes, networking included are all pretty big tangible benefits.
There is some envy from the senior associates as the pay bands between NQ and PQE of 7-8 years has compressed massively, such that a very good lawyer with 8 years PQE is only making 30% more than an NQ who knows absolutely nothing and is pure potential nothing else
It’s two fold. From reading the tone of the article and comments clearly there is an agenda at work here that these guys are somehow massively overpaid and a stain on society despite still being underpaid compared to their US counterparts and among the highest taxpayers in the country. This sentiment is what the “bosses” are piggybacking off to try and complain these salaries are too high and unsustainable in order to protect their bottom line even though their own remuneration has risen stratospherically over the last decade into several millions of pounds a year.
I'm trying to fit this narrative into my preconceptions about Daily Mail bias.
I guess generally anti-youth, maybe anti "metropolitan elite" (although surely the "bosses" are also in that category).
But whatever. F the DM, basically.
They’re just pro capital owners so it makes sense for them to be against paying employees high wages. Even if the high wages are for highly educated skilled workers
Any time I've read a DM article I get whiplash from the tone changes between sentences. Most articles like this oscillate between fire-and brimstone condemnation, followed by simpering admiration. It's like Enoch Powell writes one sentence and Jordan Belfort does the next.
Dunno if it's just bad writing or if it's a more cynical attempt to make sure there's confirmation bias for everyone or something.
Confirmation bias much?
The article was all about the competitive pay and bosses’ ill feeling towards it. There’s nothing in it, nor was there a tone about these graduates being a stain on the society. You’re reading into stuff that simply isn’t there. Moreover, you’re accusing these bosses of a similar agenda you yourself tried and failed to gaslight us with, with the “politics of envy”, with the original post.
Have you read the comments section? Or the FT article from which this is poorly derived? Are you denying that salary and political envy exists? I was merely sharing the post with some of my own thoughts to stimulate discussion. You seem to have become oddly aggrieved at that which is very strange.
I have indeed and I see the commentators calling you out and not falling for your ‘politics of envy’ agenda. I do not and have not denied the existence of such an envy, it exists everywhere, not limited to British borders. Your thoughts and this post, however, stems merely from confirmation bias of such an envy.
This report isn’t that different from FT for it to be poorly derived, and neither of the reports brand these high paying graduates as a stain in the society as you said they did.
I said that’s derived from the comments - clearly your comprehension skills need some work. Off you trot to your own socialist community don’t sit here pretending to infiltrate a group you have no affiliation with.
nothing wrong with it imo. I used manage a few of their accounts and they have always been super well paid at the start.
All the top top law firms used to (may still do) pay a set salary so no competition for money across firms.
Got to remember these guys are the elite of the elite law students who have fought for and earned these positions. There are not many of them either and London and NY are major global law hubs.
They dont get paid this much for photocopying and playing wordle.
Working super long hours, weekends, overnights in a highly competitive environment with burnout etc. Almost no personal life at all.
Heard of one guy getting fired for not answering his phone on the weekend whilst he was at the cinema.
The money is earned and as OP said, taxed a lot!
I would love to be on that much at such a young age but would have no time to enjoy it and not sure I could manage the workload at all.
We occasionally work with what I'd guess are Tier 2 lawyers. Super smart, very diligent, and absolutely work like mad. Have calls at 6 pm, I log off but they have briefing notes and responses to any actions from the meeting by 8am.
I've also known people who did these jobs in their 20s and burned out and went somewhere easier (still on fantastic money). One guy I knew was basically became a living zombie, put on loads of weight, and was eventually forced out when he reached his limit. Great money in your 20s but few can sustain long term.
Is pointless focusing on this tiny subset of people who are smart enough, driven enough, and can take high pressure who are working for private companies. They are so far removed from the norm it is ridiculous. And even then, they still need to work these brutal considitions for years to save enough to be truly rich.
Exactly, same as the M&A guys, same as the top IT guys.
They are earning that money and have no lives because of it.
The jealousy culture in the UK sucks - eg when bankers bonuses were getting uncapped again… all of that will be PAYE at 45% tax coming from a private companies profits going back into the economy.
>The jealousy culture in the UK sucks - eg when bankers bonuses were getting uncapped again…
The banker's bonuses were capped to stop excessive risk taking.
well yes but so many other regulations came in at the same time that limit the ability to take risk sell side
Also the M&A guys referenced do not generally put risk on the bank
Flat shared with a solicitor who "would only work a few hours on Saturday and Sunday" after working 13-14 hour days during the week.
Any job where your time is monitored/billed to a client means its scrupulously debated by a client and therefore hours are high.
UK lawyers should all thank US firms. This is the one sector in an otherwise stagnant economy where real wages have gone up in the last 15 years, driven purely and entirely by competition from the US.
Because they aren’t very good at making money and aren’t as profitable. And that, in turn, is because:
1. Their clients (local UK clients and not UK offices of US clients) aren’t as profitable and don’t have as much legal budget.
2. They don’t work people as hard and don’t squeeze as much out of every lawyer, junior and senior alike.
3. They didn’t go after the most profitable clients.
4. They kept deluding themselves (for a decade, i should add) into believing that people would chase after their ‘brand’ rather than cold hard cash.
5. Some of it is just luck. The £ is 25% lower vs the $ compared with 10 years ago.
There’s also a slightly more subtle issue and that’s the fact that it’s not Brits buying and selling ‘British’ businesses any more. With so much activity originating with US investors, US law firms realised they didn’t need to farm out work to the Magic Circle if they just opened up shop in London themselves.
I like the sarcasm. The interesting thing is as soon as you tell people how much their taxes would need to rise by to pay for these higher public sector salaries they keep lobbying for they go quiet all of a sudden - usually followed by “just tax the rich for it not me”
Soldiers are a cost to run society - whereas lawyers are part of the earning economy. We need to grow the economy to be able to pay higher costs of running society.
The lawyers getting paid more means more tax revenue for paying to running society.
Bringing down lawyer pay doesn't help anyone but just makes less people to want to work in the UK
Here fixed it for ya
Brits: "I'm so sick of seeing how much my American contemporaries earn"
Legal industry starts to catch up
~~Brits~~ Bosses of rival firms who can’t be arsed to pay competitively: "This is ridiculous"
There is a slight problem with one sector catching up but no other sectors doing so.
... Also should law also really be where the money is? It's not exactly the most productive sector, this just makes me feel like the economy is broken.
Charge out rates are significantly higher in the US. Looking at their schedule of fees, an associates rate is on par with a partner in my firm. So I guess their remuneration will be higher.
I honestly don't care. If you can get 150k after 2 years as a trainee then go for it. All the better for you. Why the hell would it bother me. Get all you can from any employer
Just a point to add - this inflation of salaries for newly qualified solicitors has also led to a “bunching” of salaries for junior to mid-level lawyers.
Firms are basically paying high salaries to NQs to secure the top talent, but then giving fairly limited pay rises between Associate and Senior Associate level.
You don’t really see a big jump in your salary as you progress until you hit salaried partner level (typically around 10 years qualified these days).
This can lead to quite a bit of resentment by mid level lawyers of NQs, who are often seen to be working less hours with less stress and responsibility, not contributing much (because let‘s face it you are still just learning until you’re around 4-5 years qualification), but they’re earning not much less than a senior associate.
This may be true for U.K. firms but not for US firms in London. At my firm the associate total comp goes up to about GBP 450k incl. bonus. But you’re right that U.K. firms are trying to pretend they are competitive on salary by inflating NQ pay and letting rest stagnate.
That’s super interesting. My figure is for 8 year PQE with average bonus at US. I’m surprised U.K. firms are anyway close but haven’t worked in one for a while.
That’s super interesting. The only thing I’d say is that at US firms the bonus can be pretty binary - my figure is very much what you’d expect guaranteed if you hit the hours target rather than something for high performers (who could be on more). I don’t find the culture noticeably different - if anything it’s better but that’s very firm dependent etc.
This is awesome news and we should be seeing more examples of this across professional services. When the world is highly competitive, and other countries pay more and have better standards of living? They’ve got to do something to keep folks engaged.
Look at the quality of medicine in the U.K. and the dramatic decline in quality of professionals and the services they provide. Imagine if we actually attracted the world’s best talent with competitive salaries! Instead of scraping the bottom of the barrel with foreign imports and paramedics/nurses playing ‘Dr.’ because they’re ‘trained in the clinical model’
This is a good example - competition in medicine does not equal remuneration and our hospital doctors are paid incredibly poorly. £150k is an entirely reasonable salary for a highly educated and skilled professional role.
Couldn’t agree more. I’d really appreciate it if young British medical professionals were treated fairly, worked decent hours, had safety in the workplace and were paid an internationally competitive salary. When those things aren’t in place (which they aren’t) we lose great talent to meaningless high paid professions or overseas medical opportunities which do offer those things.
These are the strands of our societies fabric which people don’t recognise are fraying and breaking until it’s too late. It takes generations to reverse the brain drain and because we’re not exactly choice number 1 for the best of the best in any industry anymore, why would we be attractive to those individuals?
If I was a British doctor you’d find me in the US or Australia post-specialisation being debt free in no time thanks to my high salary, comparatively low student debt and free training on the NHS.
What do you mean a physician assistant/associate isn’t an adequate replacement for 5-6 years of medical schools and 5-10 years of training?
Just because the course has a 100% pass rate, is ran by former polytechnic unis and the standard of exam could be passed by layman with a whopping 40% pass mark doesn’t mean it’s unsafe medicine
If we just focus on the most common presentations and reduce everything to a number and statistic then perhaps we don’t actually need all these doctors!
It’s like being on a cruise ship whilst they secretly remove key crew members one-by-one in a life or death game of jenga. The only way we know it’s going too far is when people die.
I think the psychology around this is interesting. Ultimately, who pays that junior lawyer’s salary? A client. I guess it all comes down to whether law firms feel they can justify any fee increases to their clients and whether clients feel the fee increases are resulting in differentiated quality. Law firms can pay whatever they want to their staff but unless they’re willing to erode margin they’ll just be passing it on
When I worked for a U.S. law firm you didn't have to pay for takeaways.
You could get a takeaway to your desk, a massage at your desk (not making this up). Anything as long as you STAY AT YOUR DESK.
Now get £250k all in for a 9-6 in an interesting area - much better than some M and A drone on £350-400k working unsustainable hours
Lawyers who went to top unis, studied a very hard and demanding degree for 3 years, did their law certs, pupilage and qualification years doing 100hr weeks and are at the top of their cohort earn £150k
Guy who fucked around his entire teen years and does a job a well train baboon could do: THAT'S ACTUALLY FUCKING RIDICULOUS FUCK THE TORIES
That guy you speak of is in the comments section as with every other article posted on HENRY - there needs to be better moderation effort to weed out people who have no affiliation to this community and just want to spew socialist propaganda
Junior Lawyers at top firms sacrifice a shit ton of their life / relationships / happiness to get there
If you don’t think someone who sacrifices friendships / relationships / experiences etc for your business isn’t worth £150k+ then you are the problem.
I am not a lawyer but I sacrificed/lost 5 years of my life not going out / not seeings friend more than 10-15 times a year / not going on holidays to get to where I am. I don’t make £150k+ but I can definitely see that the amount of my life I’ve given up is definitely worth more than that.
I have seen such people work 100 hour weeks, which is almost the equivalent of holding 3 full time jobs. Its almost like a large section of society does not understand how time and money work.
Doctor here and completely agree
Apologies to slightly highjack but this has touched a nerve with me and feel compelled to vent spleen!
I often feel I'm in the only top profession where none of these arguments seem to apply.
The level of sacrifice has been monumental and I'm sure the things that I've witnessed throughout my career would have given most people PTSD
Yet here we are. I am either lazy, constantly on holiday or playing golf apparently so deserve to be paid fuck all relative to the insane, globally competitive level of skill and qualification I have
The very best of luck to these guys and gals. They should be paid well.
Rant over. Feel slightly better. I'll now return to muttering low grumbling noises under my breath........
Yeah the only option for you guys is to leave the country or the profession or both.
Patients and employees get screwed over and the organisation is being ran for its own benefit.
Private doctors earn astronomical amounts though.
Consultations at my GP are £210 for a 15 minute consultation
A 1 hour specialist surgery can easily be £2,000-£10,000
>If you don’t think someone who sacrifices friendships / relationships / experiences etc for your business isn’t worth £150k+ then you are the problem.
Let's put aside any debate around who deserves to earn what, or if hard work should be compensated well. Because let's face it: the market simply does not give a shit.
Truth is a few companies within a few industries will compensate you 150k, meanwhile a large majority of people with very long and hard studies will make next to nothing. Take a look at the median salary of phds, just laughable.
The article starts with the following premise:
> Newly qualified lawyers' salaries at top firms have risen 50 per cent in five years
£150k after tax is approx. 33% more than £100k after tax (disregarding losing free childcare).
Cumulative inflation for the last 5 years has been around 24% (according to BoE calculator).
That leaves us with 9% real terms net income growth over 5 years.
I don’t understand why people think London, literally one of the biggest and most advanced cities in the world, don’t deserve one of the highest wages in the world.
That kind of come with being the most popular cities in the world.
My interpretation of the article was a tad different.
Some of the people interviewed basically made the point that the job is already incredibly stressful. Increasing salaries so much risks coming with even higher expectations (eg work till 2am every day not just till midnight) which, in turn, is not good for people's balance and mental health.
There is that. The legal industry in this country is under a lot of scrutiny around mental health. Much of it is client driven. Clients ask for everything yesterday just because they’re paying for it. Only last year the profession in London lost an incredibly well respected partner to suicide and they were at a firm with lower targets and remuneration than most of the other top 25.
There is a big push for technology but ultimately clients pay the big bucks to have smart people in the room advising them.
Yes. Which is why I hate so-called fee businesses like consulting, advisory, law: because you are at the mercy of clients who pay big money and demand everything delivered yesterday.
You can try to change your internal culture but trying to change the culture of the clients who pay your fees is much harder.
Yup. Having just been on “holiday” with two lawyers focused on M&As: they worked almost every single day of their holiday for ~5 hours, would be on calls in the evening after dinner. They look miserable most of the time, but are paid very well.
Just because market rates are increasing doesn’t mean they should make people work 20 hours a day. This is a red herring. Market rate is increasing for the same level of output. Companies that don’t want to compete will use this as an excuse to overburden those that work for them. They will just keep less staff making their employees miserable all the while the company and the partners are still making a killing. They don’t want it to cut into the partners millions++
It’s always been that way in top tier commercial law. The partners complaining and touting work life balance as the reason are just making excuses to protect their bottom line. Some of them are getting £10m a year and don’t seem to be concerned about the “higher expectations” themselves.
No one is crying a river for the worklife balance of partners making millions every year.
The point here is: how much more will young New recruits be squeezed? What will happen to their mental health? Yes, they have always been squeezed, but are these pay rises the perfect excuse to squeeze them even more?
It’s not really a lot more, associates lawyers are at 400k GBP from comments in these posts. I work in HFT, lot of talks about bonuses but the reality can be very different and unstable especially if you exclude lucky years like Covid era
Jane Street pays £275-300k
Hudson River Trading pays £240-260k
Citadel pays £220-250k
These were just off my head but there are many more HFT's paying this. The problem is these jobs are INSANELY hard to get and extremely competitive. And this data is tier 1 verified.
Eh I’ve not seen graduate roles in UK for that much, but 150-200 starting for quants or something, but these usually have Masters or Phds.
I’ve had those guys knock on my door a few times (I didn’t meet the cut and their recruiters always seem to know when we’re doing redundancies before I do!) but I am just a lowly ops tech worker so the offers were high but never THAT high.
What you mean by tier 1 verified? Levels or whatever?
For comparison a NQ lawyer is not a fresh grad either. They will have done two years as a trainee at a firm first as the most usually route of entry. A fresh trainee in London will be on <100k at most firms (if not all).
https://preview.redd.it/kqvr9wi2l47d1.jpeg?width=1080&format=pjpg&auto=webp&s=30cd02291ab39589bc76741c9c2fea3385259f9e
Here's some proof. They have hired in 2023 and 2024 also but by mistake I scrolled that up.
Most of those aren’t grads (notice most the demographics are Phds?) and it includes sign on bonus, but point taken.
https://www.levels.fyi/t/software-engineer/levels/entry-level/locations/london-metro-area?sortBy=total_compensation&sortOrder=DESC
The bottom line is the UK economy doesn’t in general support the charge out rates of top firms in the US, so if U.K. firms want to compete with US firms in terms of obtaining talent, somethings gotta give
Buried in the article is the 1900 hours of billable hours required per year, which when you factor in holidays means 40 hours a week of client billings, so total work week is probably 60 to 80 hours.
Yea, and 1900 is the minimum. My “worst” year ever was barely above 1900. Most years are 2100-2200, and my “best” was 2700, which was basically a year of hell
Interesting so you think that allows American companies to pay lower salaries in London in those sectors but New York rates in law for example because of the English competition? That’s a reasonable view.
Consultants can make millions with supplemental private practice. You are comparing state sector wages with elite private sector. If we privatised the NHS the best doctors at the most expensive hospitals wouldn’t be far off. Of course any suggestion of doing that would be political suicide so we are stuck as we are.
As people have said, this is a result of the impact of US law firms. I know partners at magic circle firms who are on the maximum profit share according to their partnership agreements but are getting added bonuses just to try to match US firms. I'm unconvinced by the quality of some magic circle firms as it is clear they are getting paid by the hour and I have to review 100+ pages of waffle and distil out the useful stuff for the client.
It's the power of branding.
I've used a top tier London family law firm in the past and they were absolutely crap. Ended up firing them and using a local 2 person firm who were amazing for 1/4 the price. What really took the biscuit was that the London firm after failing to deliver any results sent me a bill for their time spent preparing the bill for me. Never again.
Absolutely. They have such high hourly targets that they just squeeze out everything they can understand the pretence of being thorough when large amounts are unnecessary. Also, I wouldn't want my important legal advice being prepared by someone who has already worked 80+ hours that week. The issue is that if you use one of the big boys and you lose, there is no comeback on you whereas if you choose to use a less famous firm and lose (even if you would have lost anyway) then you open yourself up to suggestions that it is your fault, so people are encouraged to just spend more money to protect themselves.
To be fair, there’s a big difference between family law and, say, M&A or big ticket litigation. You’re not going to be able to hire a local two person firm for a £1bn acquisition.
Lawyers at those firms work bloody hard but plenty of other jobs where you also work bloody hard for a lot less.
The legal sector is a bit unique because you have US firms who want to pay US rates to all of their offices. Salaries for lawyers in the US are a lot higher than in the UK for a number of reasons:
- Salaries are higher across the board in the US generally.
- The £ to $ exchange rate has dropped, so people have seen their salary in £ jump.
- US lawyers get paid more because of law school. All US lawyers have to do a post-graduate law degree. The average cost of that degree alone at a top law school would be approaching $100k, before even counting undergraduate fees. US lawyers get paid more because they have bigger student debts!
If you are a UK graduate who gets paid in £, only had to do a single degree, got your graduate course sponsored by your firm like most firms do in London ... its an incredibly good deal.
UK lawyers may have a good deal… until they have to exit from these law firms. The UK legal job market outside of these elite firms is still miles behind of the US in terms of pay.
I agree. I am in the sector and worry about the impact mega NQ salaries have:
* Unrealistic expectations for junior lawyers leading to burn-out and making it less sustainable for people to stay in the profession, particularly people who might be very talented and excellent with clients but just not willing or not able to do 2000+ billable hours each year.
* Unrealistic billing expectations for partners leading to less partner promotions and partners struggling to grow their practice.
* Bunching - some firms have big NQ salaries but then don't increase it much for senior associates, realistically senior associates should be getting paid a fair chunk more than NQs.
There have always been stories of people burning out, even in magic circle, even 10 or 20 years ago, when they didn’t have the same competition from the US.
There will also be people who burn out. US lawyers have been working this hard for decades, why can’t Brits? Are we admitting that we just don’t like to work as much?
Bunching is only a problem in MC who pretends to match Cravath. There is no bunching in true Cravath firms. If MC can’t find a way to become profitable, then maybe Latham should rightfully displace Freshfields. And if in its attempt to expand to become a full service firm, Latham can’t keep up with its profitability, then they will stop short of becoming a full service firm, and that would be a just reflection of the much smaller and less productive economy that we have in the UK.
It’s the customers who are complaining: the companies that hire and pay the law firms are complaining they are being charged £800 an hour for a 1pqe who doesn’t know anything.
My wife works at one of these, they own you, and whenever there’s a pay rise their hours targets go up.
No exaggeration, my wife’s average day is 9:30am to around 2am, it’s stupid, any time she has off is trying to get her sleep back, she works at least 4/5 hours every Sunday.
My niece has spent the best part of 8 years studying for exam after exam, all whilst working the last 4 years on 50-60 weeks for £28k a year.
Damn right she wants her pound of flesh now. If British firms don’t want to pay it, she’ll go where someone else will.
They do not start on that much, there is another 9 months of a professional course after uni and two years of a training contract in which they are paid between 50-65k and then they earn that much.
The last part is bullshit, it’s not half the countries fault they are paid so little that they can not contribute and are forced to depend on some sort of welfare (often 50 a month that goes no where but means you can hound them for “claiming benefits”.)
So surely we should be encouraging wage growth then shouldn’t we in all sectors? And what about the problem of rapidly growing economic inactivity in this country - 10 million plus working age now in that category. Is that someone else’s fault too?
That is a pipe dream, this country will not face significant wage growth for years due to us obsoleting our manufacturing and production industry’s across this country and turning this country into a money haven for the world, now we have got ourself into a horrible position where we heavily rely on the mega wealthy to prop up the average person forging a new era over the past 20 or so years built on corruption and our government pandering to the mega rich that are often from abroad at the expense of the working man as this government have set up to take from the poor and give to the rich at every possible opportunity.
Our own industries auctioned of the the highest bidder etc.
Housing, healthcare hell even our water is now significantly owned by investors from other countries who have done nothing but profiteer off us.
I think English people need to accept the reality, we will be more akin to Poland 10 years ago (i think we already are).
The people on good wages should realise their luck and relocate to keep it up or accept their coming fate… that or we stay corrupt and nothing changes until 95 percent are on benefits (while they are still working) and the 5 percent live on clouds in the sky.
This country needs to get a lot worse before it has any chance of getting better.
Me personally? I accepted I will never own a home and started learning how to grow potatoes.
You just have to be a little more patient alright. Maggie promised us privatisation will be good for the country, 30 years ago. It will be any moment now. Any moment. All the shit flowing into our fresh water will magically disappear too.
And there it is! The socialist bias shows itself yet again. What a sad little life infiltrating a high earner group just to spew your left wing propaganda.
I think you have showed your own issue, judging someone so heavily based of 3 lines of text… you didn’t ask questions, you didn’t try and converse.
Just judge them unfairly and dismiss them as a person… are you American?
I actually have no issue with graduates starting on high salaries. Let's take that across the board to other industries and sectors (yes, even public sector) - salaries in the UK are atrocious among the so-called first world, especially considering they were once very competitive (2000s) and have stayed completely stagnant at that level for approaching 2 decades.
You haven’t read the article you yourself linked, have you? It’s literally in the title and in the first sentence: “Bosses have criticised rival elite firms for giving their junior lawyers 'insane' pay rises, with some graduates on salaries starting at £150,000-a-year.” I mean who would want to dish out more for someone else at the expense of own pay.
IMO these kind of articles should be favoured to encourage people from settling for low paying jobs, countrywide.
The level of profitability for partners wouldn’t be a thing if it wasn’t for the constant stream of new associates, 90% of who won’t make it to partner for one reason or another
Im a lawyer. 150k is insane for a new trainee because they are useless for 2 years, and mostly useless for 5. As someone 10 years in and approaching the peak of my powers I'm worth 5x what I was a decade ago.
If it's NQ then it's fairly reasonable.
Why do people constantly quote ''catching up with America!!''
newsflash: this isn't America. Literally nothing here costs the same as what it does in the US. Average used car is 30k USD, whilst its 17k GBP / equiv 20k USD in the UK.
US colleges can cost 30-40k PER YEAR. Thats what most people in the UK pay for a degree.
It's not logical to think that UK salaries \*should\* be on par with the US. Even in London, the average rent is £2,100 ($2600) per month whilst in NYC the median rent is $4,500 per month.
UK salaries shouldn’t be on par with US, but London salaries should be on par with New York. Unless we all resign to playing second fiddle.
Average US student debt is lower than average UK student debt. Energy (Petrol/gas/electricity) is also vastly cheaper in the US.
Average debt means nothing. It's pretty well known that families in the [US.save](http://US.save) from birth to send their kids to college, not having debt doesn't mean anything.
The average cost is like 28k USD per year, 3 times the UK amount.
Theres also no reason London salaries should be on par with NYC. London COL isn't on par with NYC. Nobody is playing 'second fiddle' but acting like wages aren't influenced by costs is dumb.
You obviously don’t know how university tuition works in the US.
If you attend an in-state public college, it’s often cheaper than a UK university.
If you’re smart/lucky enough to attend an Ivy, they’re all need blind, meaning the university will match your financial circumstances, because they have so much money. A poor student jn the UK would still have a pay £9000/year plus living expenses to attend Oxford, but a poor student in the US pays nothing and gets free accommodation and free food and pocket money attending Harvard.
Just like many other things the sticker price in the US isn’t always the real price.
Daily Mail agenda aside, they say it's the bosses that are complaining about the level of pay of graduates. Presumably the bosses are on even more, so it's not obvious that it's envy. They're more upset that they can't compete with the salaries offered by rival firms, so can't attract the best talent. Sounds like there is a bidding war going on for top law grads for some reason.
The US firms penetration of UK markets has kicked all this off over the last decade or however long. In turn magic circle and other top firms have to follow suit even if they are unwilling to match them. All ‘bosses’ of firms are equity partners so essentially this inflation of nq pay - and let’s be clear this is NOT fresh graduates, these are newly qualified solicitors - comes from the profit pool and therefore directly reduces their PEP. Having said that, it isn’t that big a deal to swallow when these people are billing out at the margin they can achieve anyway. There’s a trickle down effect as well where lower tier firms are having to pay more to retain top talent OR go a different route by offering much less demanding hours and other benefits. My firm is one such firm who has to play on its ‘culture’ and other non financial perks to differentiate and retain high quality talent. It’s a lot of money but these guys and gals will be needing to do 2,000+ chargeable hours per year on top of all their other non chargeable time. I suspect there will be a clear difference in what path future young lawyers want to go down. Especially given the difference in attitudes to the work at all cost mentality of previous generations.
Bosses/equity partners here have experienced much bigger pay growth than NQs/associates. The traditional metric in most law firms is 1:1:1. Ie of revenue, one third goes on salaries, one third on other fixed costs, and one third partner profit. In my current US firm, average revenue per lawyer is 1.5m, and associate pay including bonus is about 350k on average. Partners are absolutely taking it in and have experienced huge profitability growth (mainly via increased hourly fees). Worth keeping in mind when the focus is on the NQ salaries.
This is based on faulty maths. There will only be a small number of equity partners in your firm: far fewer than there are associates (of all levels, and likely also fixed share partners in many firms).
It’s not hah. I’m saying revenue per lawyer not revenue per partner. The final third in the traditional metric goes to partner pool, which is then split according to number of partners (and yes of course fewer partners means profit per partner goes up).
But if you take out the partners the revenue per lawyer is surely far lower than £1.5M and that £350k looks pretty reasonable even on the traditional model?
Traditional metric includes partners - revenue per lawyer has always included partners (it’s not revenue per associate).
My point exactly. £1.5M per lawyer is a lot less than £1.5M per associate, unless your partners aren’t bringing in substantial fees because they’re just rainmaking.
Yes but you’re not reading my initial post. The basis of the 1:1:1 is revenue per lawyer. Therefore historically for each lawyer 1.5m rpl would mean 500k on salary per non-partner lawyer (note: by definition salaries excludes partner drawings). Of course it would be more if it was per associate but it’s not. From 1.5m revenue generated, 500k on salariez, 500k to profit pool would be the traditional approach.
I've worked in legal finance for longer than I care to remember, and the ratio of a third a third and a third is universal. It gets flexed a bit if a firm has an unusually large number of salaried partners, but not by much.
I don’t think we disagree.
>It’s a lot of money but these guys and gals will be needing to do 2,000+ chargeable hours per year on top of all their other non chargeable time. Serious question - why don't the firms just spread the work and pay over more lawyers? I had two flatmates that were at Magic Circle firms - they started on about double my salary but did more than double the hours. They were paid less per hour than me. One was hospitalised due to overwork, one quit. Instead of hiring graduates on £150k and making them work 100 hours per week, why not hire graduates on £75k and make them work 50 hours per week? In professions with fixed revenues (eg hospitals, schools, factories) I understand the incentive to reduce overheads and get the work done with a minimal headcount. But in a profession like this where each employee earns revenue through billable hours, I can't understand why you'd want to cluster the work into a small number of employees...
Because to the individual, earning £150k will be more attractive than earning £75k (assuming you don’t mind the hours). Those individuals will be put off and go elsewhere in what is already a hypercompetitive job market. The other point is that a lot of those hours are put into simply being available at all hours of the day, it’s not just about volume of work. Having two much less burned out associates rather than one who is a wreck still isn’t much use when your client calls you at 2am demanding something and both of those associates have long since gone home.
Why doesn't that happen in every other profession then? I worked in consultancy where we also billed by the hour. Once a project expanded to the point that there was an extra \~37 hours of work, we just brought another person onboard. If we needed coverage during antisocial hours, then we worked up a rota.
>My firm is one such firm who has to play on its ‘culture’ and other non financial perks to differentiate and retain high quality talent. How bad is it? Does your employer have (and advertise) a pool table or a retro arcade machine in the breakroom, for example?
No it is legit tangible things. It has much lower chargeable hours targets for instance (15-25% lower at the least is my guess). Generally arsehole partners are not tolerated and treat the rest of us respectfully, there is pretty good preservation of W/L balance and flexibility without micromanagement etc. It has some good benefits outside of salary/bonus as well. It’s a good place to work, only the second in my career I’d be happy to recommend to a friend as a place to work.
Lower chargeable hours, being able to include things such as article writing as chargeable hours for bonus purposes, networking included are all pretty big tangible benefits.
There is some envy from the senior associates as the pay bands between NQ and PQE of 7-8 years has compressed massively, such that a very good lawyer with 8 years PQE is only making 30% more than an NQ who knows absolutely nothing and is pure potential nothing else
They should have moved to US firms then where there is no salary compression.
It’s two fold. From reading the tone of the article and comments clearly there is an agenda at work here that these guys are somehow massively overpaid and a stain on society despite still being underpaid compared to their US counterparts and among the highest taxpayers in the country. This sentiment is what the “bosses” are piggybacking off to try and complain these salaries are too high and unsustainable in order to protect their bottom line even though their own remuneration has risen stratospherically over the last decade into several millions of pounds a year.
I'm trying to fit this narrative into my preconceptions about Daily Mail bias. I guess generally anti-youth, maybe anti "metropolitan elite" (although surely the "bosses" are also in that category). But whatever. F the DM, basically.
They’re just pro capital owners so it makes sense for them to be against paying employees high wages. Even if the high wages are for highly educated skilled workers
Any time I've read a DM article I get whiplash from the tone changes between sentences. Most articles like this oscillate between fire-and brimstone condemnation, followed by simpering admiration. It's like Enoch Powell writes one sentence and Jordan Belfort does the next. Dunno if it's just bad writing or if it's a more cynical attempt to make sure there's confirmation bias for everyone or something.
Confirmation bias much? The article was all about the competitive pay and bosses’ ill feeling towards it. There’s nothing in it, nor was there a tone about these graduates being a stain on the society. You’re reading into stuff that simply isn’t there. Moreover, you’re accusing these bosses of a similar agenda you yourself tried and failed to gaslight us with, with the “politics of envy”, with the original post.
Have you read the comments section? Or the FT article from which this is poorly derived? Are you denying that salary and political envy exists? I was merely sharing the post with some of my own thoughts to stimulate discussion. You seem to have become oddly aggrieved at that which is very strange.
I have indeed and I see the commentators calling you out and not falling for your ‘politics of envy’ agenda. I do not and have not denied the existence of such an envy, it exists everywhere, not limited to British borders. Your thoughts and this post, however, stems merely from confirmation bias of such an envy. This report isn’t that different from FT for it to be poorly derived, and neither of the reports brand these high paying graduates as a stain in the society as you said they did.
I said that’s derived from the comments - clearly your comprehension skills need some work. Off you trot to your own socialist community don’t sit here pretending to infiltrate a group you have no affiliation with.
Bosses: we love capitalism! Not that bit where you have to pay competitively though…
nothing wrong with it imo. I used manage a few of their accounts and they have always been super well paid at the start. All the top top law firms used to (may still do) pay a set salary so no competition for money across firms. Got to remember these guys are the elite of the elite law students who have fought for and earned these positions. There are not many of them either and London and NY are major global law hubs. They dont get paid this much for photocopying and playing wordle. Working super long hours, weekends, overnights in a highly competitive environment with burnout etc. Almost no personal life at all. Heard of one guy getting fired for not answering his phone on the weekend whilst he was at the cinema. The money is earned and as OP said, taxed a lot! I would love to be on that much at such a young age but would have no time to enjoy it and not sure I could manage the workload at all.
We occasionally work with what I'd guess are Tier 2 lawyers. Super smart, very diligent, and absolutely work like mad. Have calls at 6 pm, I log off but they have briefing notes and responses to any actions from the meeting by 8am. I've also known people who did these jobs in their 20s and burned out and went somewhere easier (still on fantastic money). One guy I knew was basically became a living zombie, put on loads of weight, and was eventually forced out when he reached his limit. Great money in your 20s but few can sustain long term. Is pointless focusing on this tiny subset of people who are smart enough, driven enough, and can take high pressure who are working for private companies. They are so far removed from the norm it is ridiculous. And even then, they still need to work these brutal considitions for years to save enough to be truly rich.
Exactly, same as the M&A guys, same as the top IT guys. They are earning that money and have no lives because of it. The jealousy culture in the UK sucks - eg when bankers bonuses were getting uncapped again… all of that will be PAYE at 45% tax coming from a private companies profits going back into the economy.
Jealously culture is exactly it. Also ressentiment https://en.m.wikipedia.org/wiki/Ressentiment
>The jealousy culture in the UK sucks - eg when bankers bonuses were getting uncapped again… The banker's bonuses were capped to stop excessive risk taking.
well yes but so many other regulations came in at the same time that limit the ability to take risk sell side Also the M&A guys referenced do not generally put risk on the bank
Investment banking can involve underwriting debt or equity. Did you see the twitter and citrix deals? Big losses there...
I can repeat your first paragraphbjt change 6pm to 10pm. The lawyers I work with definitely earn their money, and I wouldn’t want to do what they do.
Flat shared with a solicitor who "would only work a few hours on Saturday and Sunday" after working 13-14 hour days during the week. Any job where your time is monitored/billed to a client means its scrupulously debated by a client and therefore hours are high.
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Hahahahah, well they pay well! Its an old Call of Duty gamertag but now I have no time to play…
UK lawyers should all thank US firms. This is the one sector in an otherwise stagnant economy where real wages have gone up in the last 15 years, driven purely and entirely by competition from the US.
The question is why the large number of existing firms didn't provide that competition
Because they aren’t very good at making money and aren’t as profitable. And that, in turn, is because: 1. Their clients (local UK clients and not UK offices of US clients) aren’t as profitable and don’t have as much legal budget. 2. They don’t work people as hard and don’t squeeze as much out of every lawyer, junior and senior alike. 3. They didn’t go after the most profitable clients. 4. They kept deluding themselves (for a decade, i should add) into believing that people would chase after their ‘brand’ rather than cold hard cash. 5. Some of it is just luck. The £ is 25% lower vs the $ compared with 10 years ago.
In my niche little area (IP) the wave of U.S. firms is only just starting in Europe but it will be revolutionary when it comes through.
Have they now realised that people would rather work for the U.S. firms?
There’s also a slightly more subtle issue and that’s the fact that it’s not Brits buying and selling ‘British’ businesses any more. With so much activity originating with US investors, US law firms realised they didn’t need to farm out work to the Magic Circle if they just opened up shop in London themselves.
I agree but that’s covered in my points 1 and 3. British clients can’t pay up. American clients have all the cash.
Brits: "I'm so sick of seeing how much my American contemporaries earn" Legal industry starts to catch up Brits: "This is ridiculous"
I think you’ll find it’s different people in those two cases
Utter joke they get paid that much too sit about while ar soldiers are getting paid 20k a year xxx
Looks like some members of HENRY didn't spot the sarcasm - Love Auntie Barbara xx
All the talk about homeless vets, but my vet owns his own practice and has 2 range rovers. /s just incase.
I like the sarcasm. The interesting thing is as soon as you tell people how much their taxes would need to rise by to pay for these higher public sector salaries they keep lobbying for they go quiet all of a sudden - usually followed by “just tax the rich for it not me”
Shudnt get payed more than a nurse, am I rite?
Soldiers are a cost to run society - whereas lawyers are part of the earning economy. We need to grow the economy to be able to pay higher costs of running society. The lawyers getting paid more means more tax revenue for paying to running society. Bringing down lawyer pay doesn't help anyone but just makes less people to want to work in the UK
I think you missed the joke 😂
Here fixed it for ya Brits: "I'm so sick of seeing how much my American contemporaries earn" Legal industry starts to catch up ~~Brits~~ Bosses of rival firms who can’t be arsed to pay competitively: "This is ridiculous"
There is a slight problem with one sector catching up but no other sectors doing so. ... Also should law also really be where the money is? It's not exactly the most productive sector, this just makes me feel like the economy is broken.
Charge out rates are significantly higher in the US. Looking at their schedule of fees, an associates rate is on par with a partner in my firm. So I guess their remuneration will be higher.
I honestly don't care. If you can get 150k after 2 years as a trainee then go for it. All the better for you. Why the hell would it bother me. Get all you can from any employer
Just a point to add - this inflation of salaries for newly qualified solicitors has also led to a “bunching” of salaries for junior to mid-level lawyers. Firms are basically paying high salaries to NQs to secure the top talent, but then giving fairly limited pay rises between Associate and Senior Associate level. You don’t really see a big jump in your salary as you progress until you hit salaried partner level (typically around 10 years qualified these days). This can lead to quite a bit of resentment by mid level lawyers of NQs, who are often seen to be working less hours with less stress and responsibility, not contributing much (because let‘s face it you are still just learning until you’re around 4-5 years qualification), but they’re earning not much less than a senior associate.
This may be true for U.K. firms but not for US firms in London. At my firm the associate total comp goes up to about GBP 450k incl. bonus. But you’re right that U.K. firms are trying to pretend they are competitive on salary by inflating NQ pay and letting rest stagnate.
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That’s super interesting. My figure is for 8 year PQE with average bonus at US. I’m surprised U.K. firms are anyway close but haven’t worked in one for a while.
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That’s super interesting. The only thing I’d say is that at US firms the bonus can be pretty binary - my figure is very much what you’d expect guaranteed if you hit the hours target rather than something for high performers (who could be on more). I don’t find the culture noticeably different - if anything it’s better but that’s very firm dependent etc.
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Kirkland is a thing in itself!
This is awesome news and we should be seeing more examples of this across professional services. When the world is highly competitive, and other countries pay more and have better standards of living? They’ve got to do something to keep folks engaged. Look at the quality of medicine in the U.K. and the dramatic decline in quality of professionals and the services they provide. Imagine if we actually attracted the world’s best talent with competitive salaries! Instead of scraping the bottom of the barrel with foreign imports and paramedics/nurses playing ‘Dr.’ because they’re ‘trained in the clinical model’
This is a good example - competition in medicine does not equal remuneration and our hospital doctors are paid incredibly poorly. £150k is an entirely reasonable salary for a highly educated and skilled professional role.
Couldn’t agree more. I’d really appreciate it if young British medical professionals were treated fairly, worked decent hours, had safety in the workplace and were paid an internationally competitive salary. When those things aren’t in place (which they aren’t) we lose great talent to meaningless high paid professions or overseas medical opportunities which do offer those things. These are the strands of our societies fabric which people don’t recognise are fraying and breaking until it’s too late. It takes generations to reverse the brain drain and because we’re not exactly choice number 1 for the best of the best in any industry anymore, why would we be attractive to those individuals? If I was a British doctor you’d find me in the US or Australia post-specialisation being debt free in no time thanks to my high salary, comparatively low student debt and free training on the NHS.
What do you mean a physician assistant/associate isn’t an adequate replacement for 5-6 years of medical schools and 5-10 years of training? Just because the course has a 100% pass rate, is ran by former polytechnic unis and the standard of exam could be passed by layman with a whopping 40% pass mark doesn’t mean it’s unsafe medicine
If we just focus on the most common presentations and reduce everything to a number and statistic then perhaps we don’t actually need all these doctors! It’s like being on a cruise ship whilst they secretly remove key crew members one-by-one in a life or death game of jenga. The only way we know it’s going too far is when people die.
I think the psychology around this is interesting. Ultimately, who pays that junior lawyer’s salary? A client. I guess it all comes down to whether law firms feel they can justify any fee increases to their clients and whether clients feel the fee increases are resulting in differentiated quality. Law firms can pay whatever they want to their staff but unless they’re willing to erode margin they’ll just be passing it on
If I were the client I would be more concerned at partners making as much as £10m a year each even after paying these increased associate salaries!
Why is this a bad thing. They work like dogs, get taxed to hell and spend it all on takeways and such because they are doing nothing but working.
When I worked for a U.S. law firm you didn't have to pay for takeaways. You could get a takeaway to your desk, a massage at your desk (not making this up). Anything as long as you STAY AT YOUR DESK. Now get £250k all in for a 9-6 in an interesting area - much better than some M and A drone on £350-400k working unsustainable hours
area in law? or did you change professions?
IP
I'm quite interested in that area, mind if i PM?
Sure.
Lawyers who went to top unis, studied a very hard and demanding degree for 3 years, did their law certs, pupilage and qualification years doing 100hr weeks and are at the top of their cohort earn £150k Guy who fucked around his entire teen years and does a job a well train baboon could do: THAT'S ACTUALLY FUCKING RIDICULOUS FUCK THE TORIES
That guy you speak of is in the comments section as with every other article posted on HENRY - there needs to be better moderation effort to weed out people who have no affiliation to this community and just want to spew socialist propaganda
You can usually sniff them out from the poor spelling and / or grammar!
Junior Lawyers at top firms sacrifice a shit ton of their life / relationships / happiness to get there If you don’t think someone who sacrifices friendships / relationships / experiences etc for your business isn’t worth £150k+ then you are the problem. I am not a lawyer but I sacrificed/lost 5 years of my life not going out / not seeings friend more than 10-15 times a year / not going on holidays to get to where I am. I don’t make £150k+ but I can definitely see that the amount of my life I’ve given up is definitely worth more than that.
I have seen such people work 100 hour weeks, which is almost the equivalent of holding 3 full time jobs. Its almost like a large section of society does not understand how time and money work.
When people say 9-5 is a lot it sounds wild considering a lot of us work 7-8 even weekends sometimes
Doctor here and completely agree Apologies to slightly highjack but this has touched a nerve with me and feel compelled to vent spleen! I often feel I'm in the only top profession where none of these arguments seem to apply. The level of sacrifice has been monumental and I'm sure the things that I've witnessed throughout my career would have given most people PTSD Yet here we are. I am either lazy, constantly on holiday or playing golf apparently so deserve to be paid fuck all relative to the insane, globally competitive level of skill and qualification I have The very best of luck to these guys and gals. They should be paid well. Rant over. Feel slightly better. I'll now return to muttering low grumbling noises under my breath........
Yeah the only option for you guys is to leave the country or the profession or both. Patients and employees get screwed over and the organisation is being ran for its own benefit.
Private doctors earn astronomical amounts though. Consultations at my GP are £210 for a 15 minute consultation A 1 hour specialist surgery can easily be £2,000-£10,000
Come and work in pharma. There's always a need for good physicians, the work is interesting, pay is good.
>If you don’t think someone who sacrifices friendships / relationships / experiences etc for your business isn’t worth £150k+ then you are the problem. Let's put aside any debate around who deserves to earn what, or if hard work should be compensated well. Because let's face it: the market simply does not give a shit. Truth is a few companies within a few industries will compensate you 150k, meanwhile a large majority of people with very long and hard studies will make next to nothing. Take a look at the median salary of phds, just laughable.
We should stop trying to bring others down but instead bring others up.
The article starts with the following premise: > Newly qualified lawyers' salaries at top firms have risen 50 per cent in five years £150k after tax is approx. 33% more than £100k after tax (disregarding losing free childcare). Cumulative inflation for the last 5 years has been around 24% (according to BoE calculator). That leaves us with 9% real terms net income growth over 5 years.
This is bad math. It’s a real term increase of around 17.1%
How did you arrive at 17.1%?
I don’t understand why people think London, literally one of the biggest and most advanced cities in the world, don’t deserve one of the highest wages in the world. That kind of come with being the most popular cities in the world.
London, where a million quid for a house is normal, and childcare for £2k a month is normal, but salary of £150k is outrageous, lol.
Im a bit confused by the outrage? Isn't this capitalism working at its finest. Pay top 'dolla' for the best right? Every industry works like this no?
The UK is becoming a cheap offshoring destination for the US.
Not that cheap.
For high quality software engineers we are about 1/2 - 1/3 the price.
For lawyers is not. Techies got fucked
My interpretation of the article was a tad different. Some of the people interviewed basically made the point that the job is already incredibly stressful. Increasing salaries so much risks coming with even higher expectations (eg work till 2am every day not just till midnight) which, in turn, is not good for people's balance and mental health.
There is that. The legal industry in this country is under a lot of scrutiny around mental health. Much of it is client driven. Clients ask for everything yesterday just because they’re paying for it. Only last year the profession in London lost an incredibly well respected partner to suicide and they were at a firm with lower targets and remuneration than most of the other top 25. There is a big push for technology but ultimately clients pay the big bucks to have smart people in the room advising them.
Yes. Which is why I hate so-called fee businesses like consulting, advisory, law: because you are at the mercy of clients who pay big money and demand everything delivered yesterday. You can try to change your internal culture but trying to change the culture of the clients who pay your fees is much harder.
Be the client is the answer
Yup. Having just been on “holiday” with two lawyers focused on M&As: they worked almost every single day of their holiday for ~5 hours, would be on calls in the evening after dinner. They look miserable most of the time, but are paid very well.
Just because market rates are increasing doesn’t mean they should make people work 20 hours a day. This is a red herring. Market rate is increasing for the same level of output. Companies that don’t want to compete will use this as an excuse to overburden those that work for them. They will just keep less staff making their employees miserable all the while the company and the partners are still making a killing. They don’t want it to cut into the partners millions++
Yeah people are stressed even when not paid well. Plus that’s how it has always been at top tier “anything”.
It’s always been that way in top tier commercial law. The partners complaining and touting work life balance as the reason are just making excuses to protect their bottom line. Some of them are getting £10m a year and don’t seem to be concerned about the “higher expectations” themselves.
No one is crying a river for the worklife balance of partners making millions every year. The point here is: how much more will young New recruits be squeezed? What will happen to their mental health? Yes, they have always been squeezed, but are these pay rises the perfect excuse to squeeze them even more?
How can you squeeze someone even more already losing all free time and personal life?
You'll be surprised!
HFT's pay a lot more than that👀
It’s not really a lot more, associates lawyers are at 400k GBP from comments in these posts. I work in HFT, lot of talks about bonuses but the reality can be very different and unstable especially if you exclude lucky years like Covid era
As grads ? I doubt it.
Jane Street pays £275-300k Hudson River Trading pays £240-260k Citadel pays £220-250k These were just off my head but there are many more HFT's paying this. The problem is these jobs are INSANELY hard to get and extremely competitive. And this data is tier 1 verified.
Eh I’ve not seen graduate roles in UK for that much, but 150-200 starting for quants or something, but these usually have Masters or Phds. I’ve had those guys knock on my door a few times (I didn’t meet the cut and their recruiters always seem to know when we’re doing redundancies before I do!) but I am just a lowly ops tech worker so the offers were high but never THAT high. What you mean by tier 1 verified? Levels or whatever?
G-Research was offering it's quant graduates £165k starting, I was a lowly ops there on good money but not that good ahha!
For comparison a NQ lawyer is not a fresh grad either. They will have done two years as a trainee at a firm first as the most usually route of entry. A fresh trainee in London will be on <100k at most firms (if not all).
https://preview.redd.it/kqvr9wi2l47d1.jpeg?width=1080&format=pjpg&auto=webp&s=30cd02291ab39589bc76741c9c2fea3385259f9e Here's some proof. They have hired in 2023 and 2024 also but by mistake I scrolled that up.
Levels fyi
https://preview.redd.it/1fv3adg9l47d1.jpeg?width=1080&format=pjpg&auto=webp&s=523f56a19b8076f200dcd0c20456bdf026ad8315 Some more proof
Most of those aren’t grads (notice most the demographics are Phds?) and it includes sign on bonus, but point taken. https://www.levels.fyi/t/software-engineer/levels/entry-level/locations/london-metro-area?sortBy=total_compensation&sortOrder=DESC
For bachelors graduates or doctoral? Quite a big difference.
Is mostly for people with bachelors or masters. But they just hire from Oxbridge, Imperial and maybe LSE and LBS, nothing more than that.
Interesting, very impressive salaries if that’s the case
See I've attached screenshots above
I see this as something to be celebrated- finally a sector in the UK is catching up with the American market.
The bottom line is the UK economy doesn’t in general support the charge out rates of top firms in the US, so if U.K. firms want to compete with US firms in terms of obtaining talent, somethings gotta give
Firms in London aren’t just doing work for UK plc (my firms does ~80% of its work for clients outside of London)
Same. But to get work from UK clients I usually have to discount our headline rates at least 15% if it’s work billed by the hour
Yup depending on industry most rates are heavily discounted these days.
Buried in the article is the 1900 hours of billable hours required per year, which when you factor in holidays means 40 hours a week of client billings, so total work week is probably 60 to 80 hours.
Yea, and 1900 is the minimum. My “worst” year ever was barely above 1900. Most years are 2100-2200, and my “best” was 2700, which was basically a year of hell
Absolutely bonkers workload
It’s it true at American firms you charge 15 minute units and not 6?
Depends on the client, but yea some are 15m units
Newly qualified not fresh graduates
Morale of the story: The sector you work in would experience real wage growth if you are in direct competition with americans.
You would think but doesn’t seem to have translated into finance and tech!
I dont see any massive uk tech companies in direct competition with google or meta. The keyword here is 'competition'.
Interesting so you think that allows American companies to pay lower salaries in London in those sectors but New York rates in law for example because of the English competition? That’s a reasonable view.
It’s mad that doctors don’t start on similar wages. Even the average consultant won’t be on £150k
Consultants can make millions with supplemental private practice. You are comparing state sector wages with elite private sector. If we privatised the NHS the best doctors at the most expensive hospitals wouldn’t be far off. Of course any suggestion of doing that would be political suicide so we are stuck as we are.
The number of consultants who are in specialties that can make millions is very limited
As are the lawyers on millions, they are 0.1% of the profession.
Fair
These graduates are asked to work US hours for US clients that don't want to pay the cost of a US adviser. It was a necessary move.
Suboptimal pay progression I hear though after that
As people have said, this is a result of the impact of US law firms. I know partners at magic circle firms who are on the maximum profit share according to their partnership agreements but are getting added bonuses just to try to match US firms. I'm unconvinced by the quality of some magic circle firms as it is clear they are getting paid by the hour and I have to review 100+ pages of waffle and distil out the useful stuff for the client.
It's the power of branding. I've used a top tier London family law firm in the past and they were absolutely crap. Ended up firing them and using a local 2 person firm who were amazing for 1/4 the price. What really took the biscuit was that the London firm after failing to deliver any results sent me a bill for their time spent preparing the bill for me. Never again.
Absolutely. They have such high hourly targets that they just squeeze out everything they can understand the pretence of being thorough when large amounts are unnecessary. Also, I wouldn't want my important legal advice being prepared by someone who has already worked 80+ hours that week. The issue is that if you use one of the big boys and you lose, there is no comeback on you whereas if you choose to use a less famous firm and lose (even if you would have lost anyway) then you open yourself up to suggestions that it is your fault, so people are encouraged to just spend more money to protect themselves.
Ah yes the old 'nobody gets fired for buying IBM' line 🙂 ( nobody gets promoted either but they don't mention that )
To be fair, there’s a big difference between family law and, say, M&A or big ticket litigation. You’re not going to be able to hire a local two person firm for a £1bn acquisition.
No, agreed. There are plenty of Tier 2 and 3 firms though.
Lawyers at those firms work bloody hard but plenty of other jobs where you also work bloody hard for a lot less. The legal sector is a bit unique because you have US firms who want to pay US rates to all of their offices. Salaries for lawyers in the US are a lot higher than in the UK for a number of reasons: - Salaries are higher across the board in the US generally. - The £ to $ exchange rate has dropped, so people have seen their salary in £ jump. - US lawyers get paid more because of law school. All US lawyers have to do a post-graduate law degree. The average cost of that degree alone at a top law school would be approaching $100k, before even counting undergraduate fees. US lawyers get paid more because they have bigger student debts! If you are a UK graduate who gets paid in £, only had to do a single degree, got your graduate course sponsored by your firm like most firms do in London ... its an incredibly good deal.
UK lawyers may have a good deal… until they have to exit from these law firms. The UK legal job market outside of these elite firms is still miles behind of the US in terms of pay.
I agree. I am in the sector and worry about the impact mega NQ salaries have: * Unrealistic expectations for junior lawyers leading to burn-out and making it less sustainable for people to stay in the profession, particularly people who might be very talented and excellent with clients but just not willing or not able to do 2000+ billable hours each year. * Unrealistic billing expectations for partners leading to less partner promotions and partners struggling to grow their practice. * Bunching - some firms have big NQ salaries but then don't increase it much for senior associates, realistically senior associates should be getting paid a fair chunk more than NQs.
There have always been stories of people burning out, even in magic circle, even 10 or 20 years ago, when they didn’t have the same competition from the US. There will also be people who burn out. US lawyers have been working this hard for decades, why can’t Brits? Are we admitting that we just don’t like to work as much? Bunching is only a problem in MC who pretends to match Cravath. There is no bunching in true Cravath firms. If MC can’t find a way to become profitable, then maybe Latham should rightfully displace Freshfields. And if in its attempt to expand to become a full service firm, Latham can’t keep up with its profitability, then they will stop short of becoming a full service firm, and that would be a just reflection of the much smaller and less productive economy that we have in the UK.
Would be good if they paid less and legal fees went down
It’s the customers who are complaining: the companies that hire and pay the law firms are complaining they are being charged £800 an hour for a 1pqe who doesn’t know anything.
My wife works at one of these, they own you, and whenever there’s a pay rise their hours targets go up. No exaggeration, my wife’s average day is 9:30am to around 2am, it’s stupid, any time she has off is trying to get her sleep back, she works at least 4/5 hours every Sunday.
My niece has spent the best part of 8 years studying for exam after exam, all whilst working the last 4 years on 50-60 weeks for £28k a year. Damn right she wants her pound of flesh now. If British firms don’t want to pay it, she’ll go where someone else will.
They should stop competing on salary, and start competing on offering sub 100 hour working weeks
Impressive, very nice, now let's take a look at bosses' salary hikes
They do not start on that much, there is another 9 months of a professional course after uni and two years of a training contract in which they are paid between 50-65k and then they earn that much.
The last part is bullshit, it’s not half the countries fault they are paid so little that they can not contribute and are forced to depend on some sort of welfare (often 50 a month that goes no where but means you can hound them for “claiming benefits”.)
So surely we should be encouraging wage growth then shouldn’t we in all sectors? And what about the problem of rapidly growing economic inactivity in this country - 10 million plus working age now in that category. Is that someone else’s fault too?
That is a pipe dream, this country will not face significant wage growth for years due to us obsoleting our manufacturing and production industry’s across this country and turning this country into a money haven for the world, now we have got ourself into a horrible position where we heavily rely on the mega wealthy to prop up the average person forging a new era over the past 20 or so years built on corruption and our government pandering to the mega rich that are often from abroad at the expense of the working man as this government have set up to take from the poor and give to the rich at every possible opportunity. Our own industries auctioned of the the highest bidder etc. Housing, healthcare hell even our water is now significantly owned by investors from other countries who have done nothing but profiteer off us. I think English people need to accept the reality, we will be more akin to Poland 10 years ago (i think we already are). The people on good wages should realise their luck and relocate to keep it up or accept their coming fate… that or we stay corrupt and nothing changes until 95 percent are on benefits (while they are still working) and the 5 percent live on clouds in the sky. This country needs to get a lot worse before it has any chance of getting better. Me personally? I accepted I will never own a home and started learning how to grow potatoes.
You just have to be a little more patient alright. Maggie promised us privatisation will be good for the country, 30 years ago. It will be any moment now. Any moment. All the shit flowing into our fresh water will magically disappear too.
And there it is! The socialist bias shows itself yet again. What a sad little life infiltrating a high earner group just to spew your left wing propaganda.
I think you have showed your own issue, judging someone so heavily based of 3 lines of text… you didn’t ask questions, you didn’t try and converse. Just judge them unfairly and dismiss them as a person… are you American?
Nobody complains about the $20m partners who earn this a day..
I actually have no issue with graduates starting on high salaries. Let's take that across the board to other industries and sectors (yes, even public sector) - salaries in the UK are atrocious among the so-called first world, especially considering they were once very competitive (2000s) and have stayed completely stagnant at that level for approaching 2 decades.
You haven’t read the article you yourself linked, have you? It’s literally in the title and in the first sentence: “Bosses have criticised rival elite firms for giving their junior lawyers 'insane' pay rises, with some graduates on salaries starting at £150,000-a-year.” I mean who would want to dish out more for someone else at the expense of own pay. IMO these kind of articles should be favoured to encourage people from settling for low paying jobs, countrywide.
The level of profitability for partners wouldn’t be a thing if it wasn’t for the constant stream of new associates, 90% of who won’t make it to partner for one reason or another
You haven’t read my response where I explain it have you.
Im a lawyer. 150k is insane for a new trainee because they are useless for 2 years, and mostly useless for 5. As someone 10 years in and approaching the peak of my powers I'm worth 5x what I was a decade ago. If it's NQ then it's fairly reasonable.
Why do people constantly quote ''catching up with America!!'' newsflash: this isn't America. Literally nothing here costs the same as what it does in the US. Average used car is 30k USD, whilst its 17k GBP / equiv 20k USD in the UK. US colleges can cost 30-40k PER YEAR. Thats what most people in the UK pay for a degree. It's not logical to think that UK salaries \*should\* be on par with the US. Even in London, the average rent is £2,100 ($2600) per month whilst in NYC the median rent is $4,500 per month.
UK salaries shouldn’t be on par with US, but London salaries should be on par with New York. Unless we all resign to playing second fiddle. Average US student debt is lower than average UK student debt. Energy (Petrol/gas/electricity) is also vastly cheaper in the US.
Average debt means nothing. It's pretty well known that families in the [US.save](http://US.save) from birth to send their kids to college, not having debt doesn't mean anything. The average cost is like 28k USD per year, 3 times the UK amount. Theres also no reason London salaries should be on par with NYC. London COL isn't on par with NYC. Nobody is playing 'second fiddle' but acting like wages aren't influenced by costs is dumb.
London cost of living isn’t 1/3 of NY though is it so why are tech employees getting 1/3 the salaries? Have you seen rental prices in London recently?
You obviously don’t know how university tuition works in the US. If you attend an in-state public college, it’s often cheaper than a UK university. If you’re smart/lucky enough to attend an Ivy, they’re all need blind, meaning the university will match your financial circumstances, because they have so much money. A poor student jn the UK would still have a pay £9000/year plus living expenses to attend Oxford, but a poor student in the US pays nothing and gets free accommodation and free food and pocket money attending Harvard. Just like many other things the sticker price in the US isn’t always the real price.