Shoosmiths swaps lockstep gain for performance pay

MERIT POOL: firm intent on introducing reward scheme culture

Regional firm Shoosmiths has moved away from rewarding partners for their length of service by introducing a performance-related remuneration system.

The 62-partner practice has been phasing out its lockstep system and allocating money into a 'merit pool' for distribution among partners following comprehensive appraisals.

A revised pay structure was unanimously approved by the partnership with effect from 1 November.

Shoosmiths' chairman, Andrew Tubbs, said: 'We are trying to introduce a reward scheme culture throughout the firm and feel the same rule should apply to partners as the rest of the staff.

There has been overwhelming support for this system from the partners who recognise how it encourages achievement.'

Mr Tubbs said he thought other firms were implementing this type of pay structure to 'varying degrees'.

He said: 'Introducing a merit-linked system is a theme among forward-thinking firms.

There is transparency over the allocation of rewards which can only be a positive thing.'

Alan Hodgart, European director at legal consultancy Hildebrandt International, said that over the past five years or so, a trend has developed where mid to upper-end firms have started to relax their strict lockstep systems in favour of a merit-based structure.

'I think the driving force behind it is that many firms have good partners they want to retain, but who are not bringing in huge profits, and this can rile top performers in a firm if they are all receiving the same remuneration,' he said.

'Thus they introduce a clear performance management system, where relative earning power is reflected, that helps retain and reward the top performers.'

Andrew Towler