Clyde & Co has shaken up its pure lockstep to a three-gated remuneration structure based on merit.
The ;firm’s ;previous system began with 46 profit-sharing units and ended with 100, supplemented by a 5 per cent performance-related element. The new system, however, sees partners move through gates every three years, reaching plateau within 10 years.
Clydes chief executive Peter Hasson told The Lawyer that the new structure was more about relating pay to performance.
“Although each gate is at the three-year mark, it doesn’t mean that you can’t jump that gate in less than three years,” he explained. “Performance is reviewed routinely, and if a partner is doing exceptionally well and already has the ability to reach a gate, then they can be pushed through.”
The modified lockstep, however, will not penalise those who do not hit their performance targets, as partners are not automatically moved down the payscale for not doing well.
“We’ve taken the view that we should do things by agreement,” said Hasson. “If there’s absolute rigidity in a lockstep it’s not an attractive prospect to partners, as in some circumstances the firm would have to ask them to leave or they’d leave of their own accord.
“It’s more appropriate to agree a course of action, as that way we can keep the talent within the firm.”