Newly qualified salary war hots up as US firms top 100,000 mark

US firms in London are threatening to snatch even more top talent from City firms by upping pay to more than 100,000 for newly qualified solicitors for the first time.The development has stunned UK law firms, which at best are only paying newly qualified assistants half that amount.One source suggested: 'They must be billing three times that amount to justify it.

It's more than partners are paid at some firms.'The top paying firm in the UK is believed to be Gouldens, which traditionally pays over the top rate set by the leading City firms.

It is understood to be paying 1,000 more than the 42,000 base salary now offered at top City firms, including Clifford Chance, Allen & Overy, Slaughter and May, Linklaters & Alliance, Freshfields and Herbert Smith.Gill Jones of recruiters Taylor Root confirmed that a recent survey of 30 US law firms in London, revealed that newly qualified English solicitors can earn as much as 102,000 plus bonuses at a US firm - the same as their US counterparts.The top level of pay in the US has now shot up to between $140,000 (93,000) and $155,000, but US firms anticipate this figure will reach $160,000 by June, when pay is set for September's intake of associates from law schools.

As US firms do not have traineeships, their newly qualified associates command these salaries straight on arrival.William Plapinger, London managing partner of New York firm Sullivan & Cromwell, one of the five most profitable law firms in the world, told the Gazette that salaries of more than 100,000 were not unrealistic in London.

Sullivan & Cromwell already pays the 'going rate' of $125,000 to both US and English-qualified fee-earners, but plans to increase this before the end of the year.

Cravath Swaine & Moore, Cleary Gottlieb Steen & Hamilton and Simpson Thacher & Bartlett are also expected to meet the top rate, with Shearman & Sterling tipped to make another hike to join the big league of US payers in London.

Skadden Arps Slate Meagher & Flom is already paying fee-earners $140,000.The survey also showed that US firms were making up more partners - with 57% of firms making up English assistants to partner in the last five years excluding lateral hires.X San Francisco firm Brobech Phleger & Harrison, which lost a quarter of its associates last year, has added a clause to its standard engagement letter requiring clients who recruit its lawyers to pay 25% of each lawyer's new starting salary back to the firm as a headhunting fee, it was reported in the US last week.

Anne Mizzi