From hot to cold like that.
Allen & Overy has frozen the salaries of associates after raising the salaries of newly qualified lawyers twice last year.
The company usually reviews pay in the summer, but in an email revealed by RollOnFriday earlier this week, it told lawyers that “after careful consideration of the market and with increasingly economic conditions difficult “had” decided not to increase the occasional salaries of associates this time. ”
The Magic Circle firm said it would maintain the position “under review” (translation: if more companies in the city increase their pay, it will be rethought).
In the midst of the wage war last year, several companies in the city, including A&O, found themselves raising NQ payments in June and again in the fall. In the second round of raises in November, Allen & Overy tied Linklaters after their Magic Circle competitor raised the NQ payout to £ 107,500.
The move suggests that the recruiting battle may be cooling off, or at least that A&O expects it to be so. It is certainly not a shared approach by all companies. Clifford Chance announced in May that his NQs were receiving another pay rise, this time from 16% to £ 125,000, just like Freshfields, while Slaughter and May also currently pay NQs more than A&O: £ 115,000, and can contribute the their dumb.
£ 107,000 is not feed for chickens, but it is also over £ 50,000 for various American companies. They have far fewer lawyers to pay, but the NQs that employ people like Gibson Dunn, Goodwin, Davis Polk and Fried Frank have at least £ 160,000.
Allen & Overy has also canceled the salary review of senior associates. A&O associates receive a fixed amount at each level, while senior associates receive within a salary range, and those bands will also remain unchanged, the company told staff.
However, they can always claim a bonus. They only need to get “95% personal employment,” above the previous 90% threshold. Woohoo!
A spokesman told RollOnFriday: “After careful consideration and consultation, we have decided not to increase London NQ’s salary at this time. It was last increased in November 2021, to £ 107,500. This is a prudent decision based on a number of factors, such as the more difficult business environment. We will keep the situation under review. “