US firms' City bases outstrip UK firms' RPL by 50 per cent

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  • The interesting question is: why is this? Even ignoring the outliers, you're still talking about an average of 50% higher RPL if you compare US firms with their UK competitors.
    It can't be that the partners/associates at the US firms work longer hours (or at least can't only be this). Do they have higher rates? (surely not) Are they cherry-picking the most profitable work, and so avoiding discounted fee deals? Do they have a more senior associate mix?
    Any thoughts?

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  • having trained and worked at a US firm and now at MC firm my view would be because at UK firms there is much more support (large number of trainees, paralegals and other support staff - and often also outsourced or near-shored support services for mundane or volume work) whereas London offices of US firms often throw a small number of (very tired!) associates at a deal and the work often isn't resourced very smartly. Junior lawyers charging top dollar for hours of donkey work.

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  • It is a false comparison, and a meaningless one.
    Whilst the London offices of major UK firms will invariably be large, full service and with a large part of their activities in areas such as real estate, commercial, IP, employment, pensions, competition etc, the London offices of US firms are in general smaller and focused more on high end niche areas with a much bigger weighting towards M&A and finance.
    Compare a London office of a US firm which is genuinely full service, such as that of Baker & McKenzie, with the likes of Slaughter and May or Clifford Chance and you will get a rather different result.

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  • A bit harsh on the London firms. They tend to be weighted down with PSLs & trainees who amount to 30% of lawyers in some firms. Plus the London firms tend to have lots more non-economic full service practice components & higher rental costs because of uncommercial overstaffing. And many US firms are servicing Europe rather than a declining domestic practice & cherry picking inbound from US deals which UK firms just cannot get. Admittedly, the UK firms should address these things but it is not a like for like comparison & in some ways US firms have it easier so should be doing better unless & until they seek to replicate the UK firms (which would not be a good idea as the UK firms need to row back from where they are in the main). The probability is that talent will walk the way of the US firms because money talks, this increasing the squeeze on the UK firms, particularly the domestic focussed & particularly badly run & flabby ones who have not yet got to grips with the deadwood of partners made up in the past who would get nowhere near it today. In turn this should result in a shakedown & rightsizing. I suspect we'll see a lot of focussed boutique start-ups & some/several law firm failures in the middle market maybe as far up as just outside the MC. Outside the equity in the MC it is probably very worrying unless you have a USP or a loyal following.

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  • May be everone (so far) is right. The US firms do to some extent cherry-pick their work and don't receive large quantities of instructions to carry out routine lowish value work. Moreover the work allocation and matter management at many of teh 'Anglo' firms still leaves a lot to be desired. The maxim that work should be delegated down to the lowest qualified/experienced person who can do it SAFELY is not always followed. Then there is discounting which, whilst denied, is still widespread - again particularly in the English firms. Add in better time management discipline and it is the perfect storm. Whilst the gap will never close completely it could be halved with a little application.

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  • Fifteen minute units...

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  • This is an odd story. The fact that billing targets at US firms typically exceed UK firm billing targets (and that Partners are also expected to meet said targets - no slack cut there) means that US firms are obviously going to generate more revenue per lawyer. That's why US firms can afford to pay more - the extra 20-to 30K is small change compared to the extra revenue generated. "US firm lawyers work long hours" is not news.
    The question is who is this aimed at?
    Is it itchy-footed partners who may be eyeing up the juicy PEP that such RPL figures generate?
    Is it clients who perhaps should question whether US firms are, literally, sweating assets in order to generate revenue at the expense of resourcing matters with larger teams?
    Is it anyone in particular, or is it just idle observation?

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  • Billing in 10 minute units must help.

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