Cast your minds back. Clifford Chance was the first of the magic circle firms to enter 2000’s salary war, the first to institute a pay freeze and the first to go the other way and drop the wages of its newly qualified lawyers.
But now Linklaters is determined to set the agenda on graduate recruitment. Last year the magic circle firm was the first to break ranks from the eight-strong City LPC consortium. The move resulted in Linklaters being the first firm to have its bespoke LPC designed in conjunction with the College of Law and approved by the Law Society.
Then, last week, Linklaters became the first firm to hike its LPC maintenance grants. Indeed, the firm’s decision to break away from the City LPC consortium gave it the flexibility to do what it likes. The move also left Linklaters better placed should radical changes be made to the LPC following the conclusion of the Training Framework Review.
The 40 per cent increase in maintenance grants to £7,000 per year was driven on the face of it by student concerns over the cost of living in London (let alone the price of beer). But Linklaters is happy to admit that it’s also a response to a more competitive recruitment market. And let’s face it, if firms want to capture the cream of the graduate market, they’ve got to be prepared to pay for it.
Certainly, the timing was a stroke of genius. Letters informing trainees of the increase went out last Thursday (1 September), which is the first day that law firms are permitted to make offers of training contracts to students. But what’s more, the move has left Linklaters’ rivals playing second fiddle. Indeed, Allen & Overy and Clifford Chance, which have also signed up to bespoke courses with the College of Law, currently have no plans to hike maintenance grants.
Meanwhile, members of the now five-strong City LPC consortium – comprising Freshfields Bruckhaus Deringer, Herbert Smith, Lovells, Norton Rose and Slaughter and May – which retained BPP as their exclusive provider of the LPC, must be privately disgruntled by Linklaters’ increase.
Herbert Smith is currently reviewing its maintenance grant levels, while Lovells is expected to launch a review in the spring. But the members of the City consortium should be careful if they agree to match Linklaters’ rates. This may raise tricky competition and cartel issues. So how much longer can the City LPC consortium last now? All bets are off.