Arnold & Porter first to break from PQE on associate pay

Arnold & Porter is restructuring its London associates’ remuneration to take account of the changes relating to age discrimination in the UK.

The US firm is planning to move away from a lockstep-based system to a skills-based salary structure from the beginning of next year. The firm has also signalled its intention to involve its London associates in the restructuring process as much as possible for reasons of transparency.

“We will be moving to a banding system with different levels according to skills and core competencies,” said London administrative partner Tim Frazer. “This will be a three-stage process which we hope to have completed by the end of this year. We are involving the associates in the design of the process so that they have full confidence in its transparency, openness and fairness.”

Frazer said the first stage of the process would be to identify the skills and competencies that the firm expected associates to achieve in order to meet each level and the bands within the level.

Stage two will determine the level of competency and skills each associate currently has, and therefore which level and band they should be placed at.

Finally, Arnold & Porter will ensure it provides sufficient and appropriate training to permit associates to progress through the levels.

Frazer admitted that the new pay structure was bound to retain some element of seniority-related remuneration. “The longer you've been a lawyer the more skills you should have,” he said. “But the formal link will disappear.”

The associate salary changes will be linked to Arnold & Porter’s annual appraisal system, which is completed each November, and the firm is aiming to have the new pay structure fully in place for its salary review in January 2008.

The new pay structure will apply only to London as this is the only jurisdiction affected by the new age discrimination laws.