Gloves off in recruitment battle

As competition for the best lawyers increases and salaries rise, recruitment consultants must take on the head-hunters to survive, says Iain Millard

Once upon a time you joined a firm, became a partner and stayed loyal to that firm for life.

At the beginning of the last decade, several factors put paid to that and changed the face of recruitment for ever.

Law firms had arguably over-recruited during the boom years of the 1980s, and as a result lawyers qualifying in the early 1990s were often either unable to secure positions in their preferred practice areas or were not kept on by the firm to which they were articled.

In addition, junior lawyers, particularly in non-contentious practice areas, were being laid off.

Perceived job security became a thing of the past and was replaced by a culture of self-survival.

At the same time, US firms were beginning to move into the UK market and with them came a recruitment practice hitherto unknown in the legal market - head-hunting.

As a result, the early 1990s saw the first high-level defections or lateral hires which, while raising a few eyebrows, effectively made several partners review their positions.

Information on firm and partner profits became increasingly available.

Some partners realised that their own contributions to the firms' coffers were disproportionate to their drawings.

Moreover, with US firms offering significant salaries to lure partners to join their UK offices, money became a key factor.

In 1994, a US firm advertised a position offering a salary of 450,000.

By 1999, another US firm was offering 1 million.

But it was not only at the senior end that a wage war was taking place.

Because there had been fewer lawyers qualifying into certain non-contentious practice areas in the early 1990s, a skills shortage was created.

This meant that, at the junior end, there was a scramble to get the best lawyers and when, in 1996 White & Case raised its newly qualified salary to 45,000, leading UK firms were forced to respond.

Competition for the best lawyers has clearly contributed to the staggering rise in salaries, but it is competition for clients that has led to the rapid increase in the number of lateral hires.

Firms have had to adapt to the needs of their clients and often this means having a significant international capability and the ability to offer a full service.

To meet these demands, firms have shipped in whole teams of lawyers, and mergers - both national and international - have increased in number.

Interestingly, while several firms have merged to build critical mass, others have chosen to focus on their key strengths, resulting in numerous specialist practices.

Put all these factors in the mix and you have a legal market that has changed significantly in the last decade; a market which justifiably demands much more from the recruitment consultants who purport to service it.

The days of 'CV scattering' agencies are numbered.

Firms expect a greater depth of service - and rightly so.

An increasingly sophisticated market calls for specialists, and consultancies must offer genuine market knowledge gleaned from sources other than the directories.

In addition, they need to be able to offer candidates career advice and firms strategic business advice and guidance.

There is little doubt that the behemoths are here to stay, but it is unlikely that 'would-be' players in a legal recruitment market which is already saturated will survive without clearly defining their areas of specialism.

For example, at Tully, having built a reputation for excellence in Asia, we have been able to capitalise on our expertise in the international arena.

Beyond the consultancies, the Internet now offers firms an alternative means of recruiting lawyers either through a firm's own Web site or through specialist recruitment sites.

Ultimately, recruitment consultants will always have a key role to play but the head-hunters and the Internet will ensure that only the strongest survive.

Iain Millard is the London-based recruitment manager for Tully International.

l See recruitment focus