Clifford Chance has announced that it is to increase its London lawyers' salaries, including those of its trainees, by around 15 per cent.
With effect from 1 May, Clifford Chance first-year trainees will see their salaries increase to 35,700, up from 31,400. Second-year trainees salaries will also increase by 6,300 to 40,300.
Clifford Chance head of HR expertise Mark Spivey said: We always keep a watch on the market and when we talk to existing lawyers at the firm and future lawyers, salary, bonus and career development within the firm are clearly at the forefront of their minds.
An associate with one year's post qualified experience (PQE) at the magic circle firm will take home 66,000 a year, an increase of 6,000 from the current salary. They will have a potential maximum package of 79,200 including bonus.
A Clifford Chance lawyer with three-and-a-half years PQE will see his or her salary increase from 81,000 to 89,000.
Clifford Chance's bonus system kicks in at six months PQE and increases with PQE seniority. From May, lawyers with between six months and one year's PQE, could receive a maximum bonus of 20 per cent of base salary. This increases to a maximum of 30 per cent for those lawyers with between one-and-a-half and three-and-a-half years' PQE.
However, from 2008 the maximum attainable bonus of 40 per cent of base salary will only be available to lawyers with at least 4 years PQE. Currently, this maximum bonus can kick in at three-and-a-half years PQE.
Spivey said that the Clifford Chance bonus, which kicks in at 1,700 billable hours, is made up of three elements. These are an individual's billable contribution, their 'investment hours', which include non-billable contributions such as helping to develop training and recruitment, and an individual's 'quality' element, which refers to their 'lawyerly skills.
Spivey said: The firm starts paying out the billable element of the bonus at 95 per cent of the 1,700 hours
Last October, Clifford Chance's magic circle rival Allen & Overy announced a hike in pay of 15 per cent across the board for both its London associates and trainees from the start of November, with associate pay being linked to the value of a partner profit point.