'They may pay more but they make you work for it'
7 August 1997
14 April 2014
9 June 2014
17 March 2014
14 April 2014
29 September 2014
Robert Lindsay investigates whether there really are culture differences between US and UK law firms - or is the "kick ass" ethos of US firms simply a myth?
One day last January, Simmons & Simmons chief executive Alun Morris walked into a memorable meeting of the banking department. His task was to bolster morale after news of the departure from the team of five lawyers, two of them to US firms that were doubling their pay.
"They may pay more, but they make you work for it," was the gist of what he told the assembled group of lawyers.
As more of the City's finest lawyers go to higher paying US firms in London, the message about the Americans' aggressive culture and long hours is being constantly repeated. But is it true? Is there really a big difference in the two cultures?
Nearly all the English lawyers who work in New York firms in London agree there is a far more business-like attitude at their new practices. It all boils down to an awareness of the bottom line. Profits come first, legal niceties second.
At New York firm Dewey Ballantine this attitude is reinforced with periodical circulars to all partners openly listing all partners' billings. Deweys London banking partner Moni Mannings, one of the lawyers who left Simmons & Simmons last autumn to receive double her pay, said: "It gets rid of some of the posturing - making out that you're terribly important and you're working long hours - because everyone knows how everyone else is doing. There is no room for argument."
As for the rumour of longer hours, most English lawyers at US firms insist they work the same hours as they did in their former firms. When a big deal is going down, lawyers in both English and US firms work around the clock. And most say that there is no pressure to work late or miss holidays when there are no big transactions.
Yet the stories persist. One comes from an English lawyer who, new to New York firm Skadden Arps Slate Meagher & Flom's London office and eager to impress his colleagues, arrived on his first day at 7.30am, only to find that three lawyers were already there. They had been there all night.
Another lawyer at the firm told an English colleague that he had been up till 3.30am the night before. The English lawyer asked what had kept him up. "I was clearing my e-mails," came the answer.
What about the alleged aggression, the pressure to be seen "kicking ass"? One American partner who moved from a US practice to a City firm felt that the cliche about British reserve was true.
"American lawyers are trained to confront issues and bring them to a head with their colleagues in a confrontational way," he said. "The British approach is not as direct and things are decided in a much more collegiate way."
One source talked of "back-stabbing and office politics" at Brobeck Hale & Dorr, a London joint venture established between Brobeck Phleger & Harrison and Hale & Dorr. Securities partner Don Guiney, who founded the office seven years ago, was recruited by Freshfields two months ago. "That was not the culture we were trying to impose," he said.
Perhaps any tensions may have been created by the nature of remuneration received by each partner in the joint venture. The office consists of two US partners, one from each US parent, whose compensation is based on their billings for that year and has to be negotiated with the two US parents.
Indeed, much of the cultural difference between firms probably stems from the different pay arrangements. Guiney concedes: "Lockstep is a great advantage - partners don't argue about money and it creates an atmosphere where people don't hoard work."
Securities partner Tom Joyce defected from Shearman & Sterling's London office - where partners' equity share is strongly linked to performance - to Freshfields, where the slice of the profit cake taken is linked solely to length of service. "One of the reasons I came here," he said, "is that the lockstep system reduced competition between partners and improved co-operation."
Leading projects partner Kenneth MacRitchie went in the opposite direction, leaving lockstep at Clifford Chance in 1994 first for Milbank Tweed Hadley & McCloy and two years later for Shearman & Sterling. He appears to thrive on the "eat what you kill" diet. Both Shearman & Sterling and Milbank Tweed can move partners up or down the lockstep depending on how much they billed over periods of time.
MacRitchie said: "There are a lot of tensions in a system which seeks to remunerate by reference to making assessments - that's one of the unfortunate by-products. But it also creates a tension to perform. Lockstep creates no tensions: you lose both those elements."
MacRitchie played a part in creating his own culture at Milbank Tweed's and Shearman & Sterling's London offices. He marched into both firms with his English team, wearing casual clothes, as he had been used to at Clifford Chance where suits were kept hanging in the office. The move shocked US partners but they have now grown to accept the ways of their eccentric UK colleagues.
To a large extent, the cultures of the London offices of US firms, particularly the ones that are hiring only UK lawyers, are being created by the British personalities in them. Weil Gotshal & Manges, a New York practice with a purely performance-related profit share, has an aggressive "take no prisoners", live-to-work reputation in the US. But ex-Clifford Chance partner Maurice Allen, who has recruited a team of 30 UK lawyers, "appears to have created quite a collegiate atmosphere", according to one English lawyer from another US firm.
Allen said: "We're trying to create something which is neither UK nor US." He wants assistants to play a part in running the business of the firm and to share in a proportion of the profits earnt by the office.
Chicago firm Sidley & Austin is also building a solely UK practice. Even associate Andrew Forryan, who left last month to return to Clifford Chance as a partner, agrees that the atmosphere there is not "American". He thinks that to some extent this is helped by the fact that the Midwestern culture is less aggressive than that of New York.
In the end most agree that the similarities between US and City law firms are more striking than the differences and, more importantly, that the differences between individual firms are greater than between those of one country or another.
And a pattern is emerging - the US-owned practices which will ultimately succeed in London are the ones that are allowed to create their own culture and their own ethos.