Magic circle firm Freshfields Bruckhaus Deringer has held firm on its salaries for newly qualified solicitors rather than chase six-figure packages offered by US-based counterparts.
Newly-qualified (NQ) solicitors at the Fleet Street headquartered firm currently earn £85,000. This rate was established last year when the firm hiked base salaries by 26% from £67,500 to £85,000. Bonuses were also introduced.
Freshfields operates a milestone model as opposed to a traditional incremental pay system. It means its lawyers can get pay increases based on merit by moving through various pay bands that follow the NQ salary. Although lawyers can still jump from one band to the next the individual bands will be kept at current levels this year.
Julian Long, London managing partner, said the firm had continued to review its competitive position, which, in terms of total compensation, remains strong in the market.
‘We will continue to review and update, taking account of the market, in order to make sure our approach properly rewards our people for the work they do and the high standards they consistently achieve,’ he added.
By holding firm on its pay packets the firm’s base rate is still some way off that of the top US firms which have been making a name for themselves with their attractive offers.
As many as 15 US outfits now pay their newly qualified more than £100,000, with Akin Gump and Kirkland & Ellis topping the list at £140,000. In May White & Case continued the trend by ramping up its NQ salary from £90,000 to £105,000. One year PQE lawyers are now paid £110,000, up from £92,400.
By contrast, based on their current figures, no magic circle firm pays its NQs six-figure salaries.