Partners who are aged 50 or above had until 31 July to exercise the option to retire from the partnership with effect from yesterday (31 October). It is understood that around 80 per cent, including leading corporate partner Barry O’Brien, chose to become consultants with the firm.
The role of consultant was created to ensure a smooth transitionary period and minimum disruption to clients. Partners were given the option to become consultants with the firm for between six months and two years.
Consultants will receive a salary, but will not get pension payments until their employment ceases with the firm.
As first reported by The Lawyer (10 April), Freshfields radically overhauled its partners' pension scheme, with some accepting that they may receive as little as 60-65 per cent of their entitlement.
Under the new Freshfields pension scheme partners will receive an index-linked amount per point over a period of at least 10 years, after which payments will be reduced to zero.
Freshfields previously operated an unfunded pension scheme, whereby contributions were made into the funds out of annual profit subject to a 10 per cent cap on annual profit.