Kit Chellel
The scale of unrest at DLA Piper has been revealed in the minutes of a meeting between senior staff and employee representatives regarding the firm’s redundancy programme.
The meeting was held shortly after the firm last month announced that it was to lose 30 lawyers and 110 support staff in the latest round of cuts.
A transcript seen by The Lawyer shows office managing partner Catherine Usher fielding angry questions about the size of the redundancy package being offered. Unlike firms including Linklaters and Clifford Chance, DLA Piper is offering the statutory minimum compensation to departing staff.
One employee at the meeting described the package as an insult, saying: “I’m not sure you appreciate the level of anger on the floors”. Others asked why partners had not been affected.
A staff member said: “If as a result of the packages on offer I see people potentially losing their homes … no amount of nice drinks with my boss will make up for it.”
Those who take voluntary redundancy receive their contractual notice period, statutory redundancy payment plus one month’s salary.
The minutes also reveal that the firm is hoping to save £12m in costs through the redundancies and that a recruitment freeze has been in place since June 2008. The hiring freeze is understood to exclude newly-qualified lawyers and ‘essential roles’.
Human resources staff told the meeting that since June last year 100 employees had left the firm with only 26 per cent of vacancies being filled in a bid to lower costs.
Some seven to eight per cent of partners have left the firm during the last year, according to the meeting notes, but it was not revealed how many had joined during this time.
One London-based DLA Piper associate told The Lawyer: “Morale is very low. There is a fear this is going to be repeated in three-month cycles.”
It has also emerged that the firm considered moving to a four-day week but decided this did not suit its business model.
The 30-day consultation ends on 20 March. A spokesman for DLA Piper declined to comment on the content of the meeting, but said: “We’ve engaged in a thorough process which in two of our offices has included a formal collective consultation process including the election of workplace representatives. The representatives have added to the debate and we would like to thank them for their contributions.
“We’ve responded to the questions put to us by elected representatives in an open and detailed manner because we felt this was the right thing to do.”
Readers' comments (33)
Anonymous | 11-Mar-2009 5:54 pm
Is there an alternative?
I feel sorry for the people being made redundant, but if the works not there then what choice does DLA have? I'd like to think that if I were a business owner that when I had to make people redundant I'd offer them a great package, but what's the incentive? People will always be devastated that they have lost their job and will always be of the view that they deserve a better settlement. I don't imagine people being binned from Linklaters are delighted at their slightly better package.
I also think the view that partnerships survive intact through this sort of downturn is a misnoma. The reality is that firms like DLA will be trimming costs wherever they can and this includes removing underperforming partners.
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Anonymous | 11-Mar-2009 6:36 pm
DLA
Strange - we hear and see a lot of the newly knighted Senior Partner when things are going well - seems a bit shy on this occasion!
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Anonymous | 11-Mar-2009 7:18 pm
Same story in the Middle East
It's the same story in DLA's middle east office. Up until February the finance practice was taking in more lawyers. Then finance lawyers who had been around much longer were made redundant without proper compensation. More redundancies are bound to follow. It's a sinking ship.
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Anonymous | 11-Mar-2009 11:52 pm
Statutory abuse
So, DLA partners can not afford to offer their staff a ha'penny more than the minimum severance pay demanded by UK employment law? Disgraceful. Companies on the brink of bankruptcy, companies with little means to pay creditors, it is for the employees of these struggling companies that statutory redundancy pay is meant to act as an absolute floor. Can DLA seriously plead such poverty? Is DLA suddenly no longer a top, cash rich partnership comprised of top, cash rich, millionaire partners? No doubt the DLA press office will be putting the spin on things that deeper cuts into PPP would undermine the firm's competitiveness making statutory packages an unfortunate necessity. Gumpf. This a morally repugnant decision driven managerial egotism and naked greed.
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Anonymous | 12-Mar-2009 7:51 am
Sharing the Burden
Undoubtedly DLA which has made its name as a forward-leading firm, and its senior partner honoured accordingly, would wish to provide its staff with the best redundancy terms that it is in a position to make. One way of cushioning the impact of redundancy on the loyal staff who are now surplus to requirements would be for the partners to relinquish a portion of their profit shares during the downturn and for that money to be set aside to enhance the redundancy packages. It will damage morale within the practice if partners are seen to continue to draw their full entitlements during the recession while staff with young families are forced onto the threadbare job market. Offering social get-togethers and helplines is no substitute for bigger pay-offs now.
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Anonymous | 12-Mar-2009 9:54 am
Not surprised
As a former employee I'm not surprised. DLA used to pride itself on the 'Best Companies' status it regularly achieved. As the firm grew and the merger took place they gradually slipped off this list and money seemed to be the major driving factor. Each year DLA would announce record growth in turnover, but pay rises were barely above inflation. I understand that tough decisions have to be made in these times, but DLA's approach surely can't come as a shock to it's employees. It's very sad and my heart goes out to my former colleagues.
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Anonymous | 12-Mar-2009 10:14 am
Double standards ?
I wonder how many Employment Lawyers at DLA have advised their clients that 'they only have to pay the statutory minimum' when making blue collar workers redundant. Now they bleat that they are not getting more than they are legally entitled to.
Oh dear, the Audi A4 will have to be repossessed.Welcome to the real world.
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Anonymous | 12-Mar-2009 11:30 am
Just the legal minimum?
Special cases? Sounds like the trade unions with unrealistic demands facing the inevitable. Ever wondered what goes on in the rest of the economy or have we forgotten? Oh yes, unfashionable manufacturing! Doubt you'll see many generous payout there.
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Anonymous | 12-Mar-2009 1:23 pm
I know its not a charity but...
It is totally unbecoming of an organisation who hold themselves out to be custodians of integrity and honour to make no effort to buffer the effects of a recession for their employees. I thought times like these invoked some kind of camaraderie?
I cannot make any informed suggestions (not knowing the business) about how one goes about appeasing redundant stock - but does not appear from The Lawyer's version of the facts that DLA tried (enough/legitimately) .
Good luck recruiting real talent after that.
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Keith M Lewin | 12-Mar-2009 4:15 pm
Trouble a't Mill...
Having started work at a predecessor firm of DLA, the behemoth now striding the globe, and gone thru the ranks becoming a partner, and subsequently a consultant, I am not at all surprised by the conduct of 'the firm'.
There were many chages over the years - not all for the better.Prior to leaving I perceived that there was a culture of bullying, intimidation and cash was almost worshiped for the divi among the equity partners.
In short, most, but not all, equity partners were greedy.
I left and founded my own firm with like minded individuals.
We practice challenging and demanding law for wonderful clients - many having 'defected' from DLA.
A number of our fomer colleagues joined us.
We are happy and having fun.
I am sorry for those facing the cull; however, there is life after DLA.
For the rest of the profession, we would all do well to reflect on what we pay ourselves and how we treat others.
The Golden Rule dont be greedy and dont work for those who are greedy - do partners really need to take out more than £1m a year?
Does anyone?
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