Slaughters halves fee-earner bonus, maintains support staff payment
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Slaughter and May has halved its annual bonus for fee-earners, while maintaining bonuses for non-fee-earners at the same level as last year.
Graham White
Next month the firm will pay all fee-earners a bonus of five per cent of salary, while non-fee-earners will receive 2.5 per cent of their earnings.
This compares with the 2008 rate of 10 per cent of earnings for fee-earners and 2.5 per cent for non-fee-earners.
All staff receive the flat-rate bonus, which is not linked to targets or contribution. The firm does not pay a bonus to partners.
Executive partner Graham White (pictured) said: “The bonus is to reward lawyers and staff, some of whom have been working very hard. Clients are controlling costs and some are working extremely hard to do so. We thought we should be seen to be prudent in the way we manage our business.”
The firm made an estimated £504m over the 2008-09 financial year with average profit per equity partner thought to be in the region of £2.25m.
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Readers' comments (14)
Anonymous | 30-Oct-2009 11:47 am
Its a classic: "We thought we should be seen to be prudent in the way we manage our business.”
...and so the Partners thought the best way to do this is just pocket the money earned, thanks to the associates, themselves.
That really makes sense, doesn't it...!?
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truth be told | 30-Oct-2009 2:47 pm
It makes sense if you're a clear-sighted rather than wibbling ineffectual associate whose preference for complaining over taking action underlines your modest prospects.
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S&M for the Associates | 30-Oct-2009 3:44 pm
I have no objections to the decision, which is a commercial one (although possibly short sighted).
What I do find both ridiculous and offensive is partners attempting to justify these decisions on moral grounds. They are cutting the bonus because they have made a judgement about the relative power positions of themselves and their assistants, not because they think the decision is in the best interests of their clients.
The recruitment market is already beginning to pick up and will continue to accelerate next year. This will adjust the power balance, and pay/bonus decisions will change accordingly; nothing to do with clients whatsoever.
To be fair, it should also be noted that whilst Slaughters have frozen pay bands, assistants still progress through those bands and so get pay rises. A couple of the more struggling firms have imposed true pay freezes.
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Anonymous | 30-Oct-2009 4:07 pm
Is Truth be Told suggesting "action" along the lines of Royal Mail staff? Now that would be fun to see.
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Anonymous | 30-Oct-2009 5:21 pm
S&M for the Associates - you are wrong, Slaughters associates DO NOT move up through pay bands - pay is actually frozen
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Tuttifrutti | 30-Oct-2009 6:13 pm
S&M for the Associates - your final sentence is seriously misinformed. Just about every city firm has implemented true pay freezes for their associates this year (as have S&M as the anonymous poster at 5:21pm rightly says) - in other words a large reduction in the salary bands paid at each level of PQE. This is reflected in the circa 5k decreases seen for the NQ rates across the city.
I agree wholeheartedly with the rest of your post though, and I'm sure clients will see right through this.
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Anonymous | 30-Oct-2009 7:18 pm
The moral justifications are ridiculous. However, Slaughters associates have hardly done badly out of the recession. Certainly a lot better than their counterparts (or ex-counterparts) at Linklaters, Freshfields, A&O and CC. Give credit where it's due - Slaughters have wiped the floor with the rest of the UK legal market in this recession.
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anon | 31-Oct-2009 3:31 am
The fact is this place is run by self interested 'dudes' who think they rule the universe. What rubbish to attempt justification at the clients' woes.
Remember the grand empire, thought indestructrible by the Romans, fell.
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Paul | 31-Oct-2009 11:31 am
What a joke, Slaughter pretending it is all about "being seen to be prudent" and not wanting to offend clients! f I was a client of theirs, I would be more offended by partners earning over 2m wanting to increase their own salaries by a few thousand pounds by cutting the salaries of the associates. Fair enough Slaughters partners, you have the upper hand right now and can treat your lawyers unfairly,but they are smart people, and do not patronise them by pretending you are cutting bonuses so as to not offend clients. No one is fooled by this, least of all your employees!
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Anonymous | 31-Oct-2009 11:37 pm
The firm is most likely to end up only retaining those associates who are either:
(a) 'wibbling and ineffectual' and too scared to leave; or
(b) sufficiently arrogant to assume they will make it into the equity.
Would not want either on my matters.
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