Is Norton Rose’s four-day week just staving off the inevitable?
23 March 2009 | By Margaret Taylor
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Norton Rose is quite the darling of the legal world since it mooted plans to put all its staff – partners included – on a four-day week as a way of saving jobs (TheLawyer.com, 13 March).
Readers of TheLawyer.com were almost unanimous in voicing their support for the scheme, as the column opposite shows. But while the firm has clearly scored a PR coup with its idea – something that should stand it in good stead when the economy begins to recover – will a four-day week work for the firm in practice? Is there a chance that the plan could backfire, with Norton Rose being forced to make redundancies further down the line when the market’s memory of other firms’ layoffs has softened?
For the managing partner of one top 20 firm, any kind of widespread flexible working scheme will be problematic because, while internally it may be good for morale, externally clients could be less understanding if their trusted legal adviser is no longer at their beck and call.
“You need to have a carefully organised programme to communicate with clients to make sure service levels aren’t interrupted,” the managing partner says. “Is working four days a week good for careers, clients and so on?”
While clients may have taken a dim view of their lawyers working on a part-time basis during the boom years, especially when they were doing deal after deal in ever-faster times, the reality is that the client’s world has changed just as much as the adviser’s.
As Jomati consultant Tony Williams points out, most clients are also having to adapt to the changed economic environment and, faced with job cuts of their own, are more likely than ever before to be understanding of the move.
“Clients are doing the same thing and, anyway, they may have always worked with people at [the law firm] who have done a four-day week.”
The key, says Williams, is flexibility, both on the part of the client and
“Using the four-day week option for people you want to keep long term does make sense if they’re going to be flexible,” he adds. “Sometimes it might not be possible to have a four-day week, but the people involved could take an extra couple of days off the following week.
“If a firm can’t manage its client’s needs, then it would be doing it with one arm tied behind its back.”
Working a four-day week is clearly a good way of dealing with vastly decreased workloads and in the short term it would save on the huge sums of money required to make mass layoffs (some estimates put the cost of a redundancy programme at the equivalent of six months’ earnings).
The issue is that, while a large-scale alternative to redundancy is to be welcomed on an emotional level, from a business point of view it makes sense to use a time of economic crisis to re-evaluate how a firm is run. That inevitably means rationalising staffing levels.
As the managing partner of a US firm’s London office says, law firms must change the deal they have and, with associate salaries reaching uneconomic levels over the past several years, the only way to control that is to get rid of people.
“You have to get to the point where you’ve weeded out all the non-performers,” he says.
But as that strategy would leave firms open to the risk of losing a generation of people, it is understandable that firms such as Norton Rose would want to consider alternatives. The problem is that, if the four-day week option does not work (and it should be noted that Norton Rose has still to make a decision on whether to go down this route), the firm would then be likely to be forced to deal with redundancies at a later date.
As Williams at Jomati points out, most UK firms have got their redundancies out of the way before the end of the current financial year, meaning they will take the financial hit in 2008-09. If Norton Rose does go ahead with its four-day week and it is not deemed a success, the firm could face redundancies in the 2009-10 financial year. If that were the case, its public image could be significantly different to how it is now.