updated on 20 April 2020
Solicitors’ firms across the legal profession are making use of the government’s employee furlough scheme as they look to mitigate the financial impact of the coronavirus pandemic.
The employee retention scheme sees the taxpayer pay 80% of employees’ salaries up to £2,500 a month, enabling employers to avoid cutting jobs. The Law Gazette reports that Taylor Wessing is among the firms to furlough staff whose roles have been impacted by the need to work from home. The firm’s partnership is topping up employees’ salaries to 90-100% while on furlough, while freezing the distribution of partner profits and asking all staff to take two thirds of their allotted holiday before the end of August.
Womble Bond Dickinson has also had to furlough some staff and is topping up salaries to 100%, while partner payouts have been deferred. Meanwhile, Eversheds Sutherland is furloughing some staff while creating a hardship fund, with partner distributions on hold.
Burges Salmon said that it was unaffected in March and is continuing to review the situation.
Gateley has asked permission from staff to furlough to some employees, with agreements now in place and the firm committing to top up salaries to 100% through April for those on furlough.
Both Herbert Smith Freehills and Simmons & Simmons have deferred staff pay reviews, with HSF reducing profit distributions to partners and Simmons & Simmons delaying them entirely until later in the year.
Some 49 staff at Watson Farley & Williams have gone on furlough, while others have been asked to work reduced hours. Partner distributions have been suspended.
In the magic circle, Allen & Overy and Freshfields have suspended partner payouts and frozen staff pay reviews. Slaughter and May partners are now working unpaid, while Clifford Chance and Linklaters declined to speak to the Law Gazette. As the Gazette points out, any decision to furlough staff at the largest law firms runs the risk of reputational damage, given the large profit margins at City practices.
Norton Rose Fulbright has asked staff to reduce their working week by 20% and accept a pay cut to 80% of their normal salaries.
At HFW, a “small number” of employees have gone on furlough and no staff salaries have been cut, but partners have agreed to defer some profit distributions.
Shakespeare Martineau has decided to furlough some staff, with the chief executive and partners accepting profit distribution cuts. Meanwhile, Brabners has sent around 70 staff on furlough and said that remaining staff earning salaries of over £25,000 must accept pay cuts of 20% for four months.
The Gazette also reports that at least one large criminal law firm has said that it cannot accommodate staff working from home and that employees who stay at home will not be paid.