Paying the price

As city firms raise their assistants' salaries, billing targets are going in the same direction.

Jacky Lewis charts the rising levels of stress

A ripple of anxiety is sweeping through lawyers at the top City firms as their employers raise their billing targets.

And this month's Law Society cohort report, which showed many young solicitors in the City and even small practices working more than 50 hours a week, could just be the start of an upward spiral.

Increased hours are seen as the quid pro quo for the recent salary surge that began in Silicon Valley and spread to Wall Street and in April crossed the Atlantic.

As UK firms start to merge with their US counterparts, the US way of doing business is becoming more and more influential.

It was not a surprise that the first UK firm to raise its salaries was Clifford Chance, which merged at the start of the year with New York-based Rogers & Wells.

Allen & Overy, Freshfields and Linklaters among others in the top ten confirm their targets are set to rise by a hefty 150 hours a year.

A survey by legal recruiters Graham Gill earlier this year revealed that firms are generally raising their billing targets from 1,400 to 1,800 hours a year.

But such targets are still a holiday when compared with US firms, which record a chilling 2,000-plus hours a year.

The trend is quietly insidious though and a 'large number' of UK corporate and financial lawyers, according to Graham Gill, already record up to 3,000 billable hours in a busy year.

Working in this way does not allow for any slack and is a prime cause of anxiety and stress at work.

It is well documented that the legal profession tops the poll in workplace stress.

To bill ten hours each day, for most lawyers, is to put in 14 hours.

As famously recorded in the John Grisham best-seller, The Firm, US lawyers have different and certainly more imaginative ideas as to what constitutes billable time.

There are undoubtedly casualties.

Barry Prichard, the co-ordinator of UK solicitors' support line SolCare, says the Americans are having trouble meeting their targets, leading to an upsurge of stress-related problems.

Solicitors contacting SolCare are saying they are finding their targets unrealistic.

Three years ago almost all the calls received related to alcohol abuse; there has been a 'massive change' recently towards stories of stress and depression relating to billing targets, two-thirds of which are received are from solicitors qualified five years or less.

The big commercial firms have high charge-out rates and achieve impressive profits, but what of practices doing predominantly state-funded work? Legal aid lawyers hold that the only way for them to get their work to pay is to increase their own billing by working ludicrously long hours.

The paradox here is that their pre-set charge-out rates are so low that they are forced to put in excessive hours merely to make ends meet.

So there is stress at both ends of the spectrum albeit for different reasons.

It brings into sharp relief the divergence between these two areas of the profession - they may both put in the same hours, but while one does it for profit, the other does it for survival.

Gerald Shamash, senior partner of well-known central London legal aid practice Steel & Shamash, finds the current situation 'enormously difficult'.

As large commercial firms up their billing hours to match transatlantic trends, legal aid firms find themselves worryingly stretched.

'Only last week we lost a secretary who left to join a City firm; we just could not match the salary that they could offer.

We have a tight budget and have to be realistic about what we can afford to pay,' he says.

In common with other similar practices, there is pressure to maintain salaries at a reasonable level and the only way to do this is to increase billing hours.

The fact that legal aid rates, which have remained almost static since 1995, are virtually the same in London as in provincial cities is another anxiety.

London-based firms have the added problem of larger overheads.

Mr Shamash says: 'We pride ourselves on providing an excellent service, but despite our firm being socially committed, it is becoming increasingly difficult to balance it all out.' Maintaining salary differentials between fee-earners and non-fee-earners is a real headache.

Surprisingly, in examining the issue of increased billing targets, another picture emerges of a new 'fairness' in regarding lawyers.

A senior partner in one of the global firms suggests that practitioners are now seeing a 'measuring' of performance and a reward for genuine effort.

'We do have people who want to move ahead, but in the past they were part of a culture that made less distinction between the differing amounts of work achieved...

those that move ahead of expectation are now more likely to have their achievements validated.'

In the past, he believes, some lawyers could 'cruise along', not really pulling their weight, yet earn at the same level as harder-working colleagues; looking at new billing target expectations this might appear less possible.

Nevertheless, he admits that only those who can display this type of robustness can 'hack it'.

This is backed up by the Graham Gill survey, which found that along with the higher billing targets, City firms are ditching their reluctance to pay bonuses and are increasingly looking at linking bonuses to hours.

This gives them more flexibility than upwards-only salary changes.

But will the clients buy it? With spiralling costs being passed on, there is evidence that corporate clients are voting with their feet.

Regional law firms with lower overheads - in both facilities and salary terms thanks to their out-of-London locations - and so lower charge-out rates, such as Wragge & Co in Birmingham, are reporting success in picking up blue-chip clients who previously would not look beyond the Square Mile.

Clients want quality, but they also want value for money.

Increased overheads and raised billing hours could price London firms out of the market.

With rising fees at universities and law schools, many students' expectations are that a highly paid solicitor's job will pacify the bank manager and lead to the fast car and the good life.

With starting figures in excess of 42,000 being offered by the magic circle firms, they might be forgiven in thinking that life is beautiful, but this can be a poisoned chalice for some.

It is widely reported that it has never been a better time to be a trainee.

But what does the future hold for those who enter the law with misty-eyed hope: will they burn out within five years and be lost to the profession? As the recruitment of lawyers is increasingly drawn from the pool of those who can hack it, it does seem that the current, macho trends will be reinforced.

Clio Demetriades, a director of recruiters Legal Opportunities, considers the pressure of billing sometimes means under-supervised trainees are left to hold the fort, when an experienced lawyer should be in charge.

Trainees can be given a target during the second year, and even during the first year, of training.

She says stress, brought on by targets, often reaches 'boiling point' at the 'expensive end' of the law; although, conversely, if the solicitor is a naturally macho young blood, the pressure of billing might act as a motivator.

It might be difficult, given the British way of working, to deliver 2,000 hours a year; there are almost too few hours in the day.

Americans tend to take two weeks' vacation each year and often go to residential conferences with networking opportunities, which serve as holidays.

These conferences are usually attended without families and are really an extension of working life.

Their British counterparts often work less and take more holiday.

Geoffrey Griffin, the personnel director at Berwin Leighton, cannot envisage a time when UK lawyers' holidays reducing.

His firm is undertaking 'serious research' about getting the balance right for staff.

Time off, he says, is not just about holidays: rest is needed to allow workers to 'fire again on all four cylinders'.

He says: 'We do not want a workforce burned out in their mid thirties.' Sadly, this may not be the view across the board, and the writing may be on the wall - those holidays may have to go.

For more information on SolCare, tel: 0800 2796888.

LINKS: www.solcare.org.uk

Jacky Lewis is a freelance journalist