updated on 26 September 2023
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City lawyers could be hit with job losses and stagnant or declining pay amid the harsh consequences of the financial year, according to The Times.
Russia’s invasion of Ukraine, inflation and a lack of corporate deal making have accumulated, with pay stagnation and redundancies already taking place at US firms with fears that these consequences could spread to London.
Magic circle firm Clifford Chance released its financial figures earlier this year, revealing that pay for the firm’s private equity partners had stagnated. Meanwhile, Allen & Overy LLP partners saw pay decline on average by £130,000. Despite the pay stagnation or decline at both firms, each reported a rise in annual revenue in their financial year reports.
Former managing partner at Clifford Chance, Tony Williams, claims that it’s also the “unrealistic” salary expectations of City lawyers that are posing problems for firms.
Salaries aren’t the only concern plaguing City firms, with whispers of redundancies reportedly taking place below the radar. Director of headhunting agency Definitum, Christopher Clark, claims City firms “have been letting people go for several months”, engaging in what he described as “quiet sackings”. Such dismissals have apparently been able to take place under the radar due to non-disclosure and compromise agreements.
Clark has suggested that while it remains “extremely unlikely that starting pay will fall” for those beginning their legal careers at City firms, “it’s in turn very likely that firms will slim down to leaner teams of junior lawyers to save money”.