Over here and over paid

It has been interesting to follow reports on the escalation of solicitors' salaries which, except for the US dimension, is reminiscent of the mid-1980s when Gouldens determined to pay in excess of all City firms for newly qualifieds. Back then Gouldens decided on a heady £15,000 against a benchmark of around £12,500.

What was less edifying in the present game of leapfrog is the blatant disregard of the most important component in the whole legal services delivery business - the client.

Paul Newton, head of legal at Bupa, is to be applauded with his no-nonsense stance when he says: "[Bupa] will certainly resist any attempt to pass on to us any salary hikes for newly-qualified solicitors in increased hourly rates."

One solution that has yet to be tried by many is a more elastic range of charge out rates for assistant solicitors. Other professionals, notably accountants, have a range of rates for assistants that vary by up to a factor of threefold.

A range seemingly unheard of in legal practice which seems to prefer a one-size-fit-all philosophy.

The problem is one of supply and demand. The profession is growing by something like 4 per cent a year yet many major firms seem to have failed to react appropriately. Rather than train adequate numbers to meet planned growth, they would prefer to poach.

This has effectively contracted supply, driven up salaries and accelerated the mobility of human capital.

Let's hope more clients have the resolve to resist the inevitable price rises for legal services that will follow the massive salary rises that seem to be in the offing. As for the Americans, it is high time they learned that when working overseas it is usual to adjust to local pay and conditions, not rock the boat.



Ashely Balls, partner, Ashely PMF, New Zealand.