In a surprising U-turn in strategy, Slaughter and May has succumbed to pressure from Dresdner Kleinwort Wasserstein and agreed to hourly rates for the bank's own account work
However, for transactional work where the bank receives payment from a client, Slaughters will continue to charge on a fixed-fee basis. The changes were made as a concession to the bank which has set up its first-ever legal panel. Although only a small percentage of fees from DKW come from the bank's own account work, the decision is significant because it reflects a softer approach to Slaughter's billing. DKW announced its London panel at the end of July. The eight firms are Allen & Overy, Ashurst Morris Crisp, Clifford Chance, Freshfields Bruckhaus Deringer, Linklaters, SJ Berwin, Slaughter and May and Watson Farley & Williams. Bird & Bird is included for IP and IT work and McDermott Will & Emery will be used for HR advice. Despite current relationships with the firm, neither Lovells nor Norton Rose made the grade. The panel was initiated by the procurement department which sees it as the most successful way to maximise the potential of its legal advisers. As part of the pitch, firms were invited to make concessions in relation to fees. They were asked to propose discounts on hourly rates, agree not to increase hourly rates without the bank's consent and offer discounts on a size of volume basis. They were also asked to drop success fees and premiums for unsociable hours. It is unclear whether all the firms, bar Slaughters, agreed to all the concessions, but at least two other firms were holding out until recently. The initiative's legal side is being led by head of legal Stephen Lowe, who confirmed the firms on the panel but declined to comment. DKW is currently undergoing a reorganisation which will see it shed an estimated 3,000 jobs worldwide. However, it will be left relatively unscathed by the redundancies. The announcement is expected this week.