Hanging on to your investment
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Many firms feel frustrated that the trainees they spend thousands of pounds on do not stay for long, writes Peter Weiss. Peter Weiss is a freelance journalist. Specialist recruitment agencies and other industry insiders estimate that law firms spend between £60,000 and £80,000 on each of their trainees only to see many of them leave within two years of qualifying. From the firms' point of view this is money that could have been better spent on other projects or on recruiting longer-term bets. From the students' point of view, it is a huge investment that is being made in their future.
Why do many trainees leave after only two years? Is it the money? Is it that they have chosen the wrong career path? Is it that their supervisors have not been monitoring their progress closely enough so that they feel that the firm is not genuinely committed to their future?
"A lot of lawyers recognise that they are not professional managers," says Kate Day, business development manager at Mishcon de Reya, a firm that undertakes annual appraisals of its trainees and newly-qualified lawyers entirely independently of salary reviews.
The aim is to see if each newly-qualified solicitor has achieved their own personal targets. "It is a medium through which one can obtain feedback," explains Day.
While many large firms recruit more than 50 trainees with a view to taking half that many on permanently, others, including many mid-sized specialist firms, recruit smaller numbers and are more selective.
"We are quite unusual for a top 10 firm," says Nicholas Cheffings, partner in charge of trainee recruitment at Nabarro Nathanson. "Our position is different in that we recruit fewer trainees with the intention that all of them will stay on with us. We are making a long-term investment in them and hope that in 10 years they can be looking to become a partner with us."
Among those firms which selectively recruit small numbers of trainees, 80 per cent tend to remain after qualification and a majority of those stay on long term. The problem is that as a firm expands and individuals leave the trainee framework, they may no longer feel that they are being adequately considered in the practice's overall picture.
"We are looking at a form of mentoring where people grow up within the firm," says Cheffings, who is considering a system where each newly-qualified solicitor is assigned to a mentor who can monitor their progress, and to whom they talk informally about issues which concern them.
"It may be valuable to have the mentor in a department other than the one in which the solicitor is working," says Day.
One of the problems is that many trainees who are unhappy at their present firms, only discover their preferences once they have already committed to a long-term arrangement.
"I encourage students to be really sure about their decisions. Their choices can really affect their career progression," says Sue Watt, careers adviser at the University of Westminster, who directs students to do as much research as possible to be selective in their approach. "It is very difficult to switch from a commercial City firm to a high street practice."
However, for those students lucky enough to obtain funding for their CPE and LPC, the temptation is to take the funding which large firms offer and to decide later what they will do. Many of the larger firms lose their newly qualifieds to in-house positions, and generally money is not the primary reason for their move.
The factors which drive different lawyers to make the change depend on their industry sector and the type of firm they are leaving, according to Joe Macrae, founder of ZMB, a legal recruitment agency. "For banking lawyers leaving top 10 City firms, a substantial proportion of those who are moving want to go in-house."
Banks in particular offer big financial incentives, including bonuses, pensions and company cars. "A high proportion of corporate lawyers who leave within two years of beginning their careers are not going to another law firm," says Macrae.
Many corporate lawyers feel that they do not get a chance to build long-term relationships with clients who are always changing. "If you move in-house, you get to understand the industry; it is a different level of job satisfaction," he says. Lawyers leaving large corporate practices tend to be drawn to the regular hours of in-house work, which often pay less than the firms they have left.
The primary reason for those in mid-sized firms leaving within the first two years is generally not that they are unhappy with the firm but rather with their allotted field of work.
"Those in mid-sized firms are either looking to be part of a larger team with greater resources or they tend to look for small entrepreneurial start-up companies," says Macrae, While in the past, firms had to compete with other firms and the private sector tempting away their young talent, a number of new players, including US firms and international accountancy practices, are on the lookout for newly-qualified lawyers and are prepared to offer them significant rewards.
With such competition, firms will have to rethink how to retain the talent that they have spent so much time and money to train.