Addleshaws cuts fee-earners as profits rise 30 per cent
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Addleshaw Goddard is cutting around 24 fee-earners across its offices in a bid to combat low attrition as the firm posts a 30 per cent rise in profit.
Addleshaws said it had begun a redundancy consultation to, “rebalance the mix and skills and experience across each UK office” as attrition among senior fee earners drops.
The firm expects around 24 fee-earners to be made redundant. This amounts to approximately 3.5 per cent of the total number of non-partner fee-earners.
According to Addleshaws over the past five years fee-earner numbers have dropped from 490 to 437 but the firm’s two most senior fee-earner categories (managing associate and legal director) have together increased from 100 to 173.
A firm spokesperson added that there are no similar plans to cut partner or support staff numbers.
The news comes as Addleshaws has posted a 5 per cent rise in turnover for the 2011-12 financial year. Revenue at the firm was £170m, up from £161.9m in 2010-11.
Profit for 2011-12 was up 30 per cent, from £34.4m to £44.9m, while average profit per equity partner (PEP) rose 37 per cent over the same period, from £328,000 to £450,000.
The rises come after a disappointing 2010-11, however, when the firm cut around 40 support staff jobs (24 May 2011).
In that year profit fell 17 per cent, average PEP dropped 23 per cent and revenue fell by just over 3 per cent.
In a statement, Addleshaw Goddard’s managing partner Paul Devitt said: “In common with other businesses, natural attrition in our firm, especially amongst senior fee-earners, has fallen in recent years. We have therefore taken the difficult decision, having so far avoided a fee earner redundancy programme, to rebalance the shape and size of our front-line fee-earner resource by reducing the number of non-partner fee-earners.”
Addleshaws’ 2011-12 revenue by division:
Commercial services: £23.4m
Corporate: £29.2m
Litigation: £37.4m
Finance and projects: £37.3m
Real estate: £35.4m
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Readers' comments (27)
Anonymous | 22-Jun-2012 3:59 pm
What I don't understand is the trend towards legal director at City firms. If the title is billed as an attractive alternative to partnership then how credible can it be if you are continually at risk of redundancy in the brave new world of the challenged partnership model. Why won't redundancies at this level become a regular thing every 3 years or so?
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Anonymous | 22-Jun-2012 4:37 pm
I really don't get the sentimentality and trash that gets posted on stories like this. So what, 24 fee earners lost their job. Thousands have been losing their jobs for the last few years. Why is being a fee earner so special or protect you from the harsh realities of business. Wake up and don't be so naive. Of course the partners want more money - isn't that after all one of the reasons you became a lawyer?
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Anonymous | 25-Jun-2012 7:35 pm
Some typically crass responses from partners/ wannabes. If AG's partners have any decency at all they'll make decent pay outs. Remains to be seen... The firm has been showing people the exit for years on the quiet.
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Anonymous | 27-Jun-2012 1:06 pm
Even after this story I still think Addleshaws care about their staff more than Dickinson Dees.
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Anonymous | 28-Jun-2012 1:51 pm
I assume the comment above, which defends the firm by proclaming that there is one law firm in the UK that is even worse, is written by a member of the HR Team. Well done, marketing disaster averted
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john | 2-Jul-2012 10:38 pm
It's the fact that we are meant to feel sorry for the partners after their drop in PEP last year that gets to me. Although, how could they have possibly survived on such a measly sum! Good on them for getting rid of decent hard working underpaid (yes that's right compared to what others in the local market pay) undervalued people after pushing them hard...
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Anonymous | 6-Jul-2012 9:35 am
Amazing that any fee earning lawyer thinks they have an elevated right to job security.
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