Hiring hiatus comes to an end as mid-sizers target magic circle talent, but reticence remains
The UK’s top 25 firms are back in recruitment mode, with an estimated 2,133 people having been brought on board to UK offices in 2009-10 alone.
However, the total number of hires is still exceeded by the 2,370 people firms made redundant during the downturn, suggesting management caution has far from subsided.
Slaughter and May has hired 78 people during the current financial year, but in line with its conservative approach to lateral hiring all of them were associates and support staff rather than partners.
Slaughters practice partner Paul Olney said: “In general we’ve been hiring fewer than normal this year. In certain areas, such as insolvency and restructuring, there’s much more of a vibrant market. We have a more generalist practice, so our general goal has been to redeploy people where we can. We probably tend to take fewer laterals than other firms.
“We’ve not put a freeze on hiring [support staff], but we’d only want to hire in this still uncertain time where we need to add resources.”
Partner recruitment is still a fraction of overall hires among the top 25, while most of the magic circle made no lateral hires at all. The exceptions are Allen & Overy, which brought four partners into IP litigation, high-yield and equity capital markets, and Linklaters, which brought in litigation partner Christa Band from Herbert Smith.
A senior partner at Freshfields Bruckhaus Deringer defended the lack of lateral hires at his firm, saying: “We’ve lost fewer people [than other firms], so it’s not surprising if we’ve hired fewer too.”
Nick Woolf, a headhunter at Sainty Hird & Partners, said a lot of the partner hires could be accounted for by opportunistic captures by mid-market outfits of magic circle departees.
“There’s two types of lateral hires, one being opportunistic, the other strategic,” he said. “Magic circle firms are rarely opportunistic and they don’t have to be. They don’t have many weaknesses, whereas mid-sized firms do have gaps.”
One of the largest groups of partner hires has been at Berwin Leighton Paisner (BLP), which has brought in 10 laterals, particularly into finance, tax and litigation. The firm has laid off 85 people since autumn 2007.
BLP managing partner Neville Eisenberg said: “Our strategy’s always been to build our capabilities in key areas and hire the best people. The recession provided us with more opportunities to hire leading individuals, and in doing so we’ve propelled our strategy forward.”
The highest numbers of hires were made by two firms with large volume businesses, Irwin Mitchell and Eversheds, which recruited 414 and 293 people respectively. Since late 2007 Irwin Mitchell has laid off 16, while Eversheds parted company with 735.
Around 138 of Irwin Mitchell’s hires were fee-earners, the vast majority of whom were into the personal injury arm. Eversheds recruited significantly into its volume business, Legal Systems Group.
Eversheds HR director Angus MacGregor said that, despite plans to expand its volume business further, including talk of outsourcing to its South Africa office, most of these hires were due to a high churn rate. He added that the high number of hires is also reflective of the firm upgrading its finance and IT capabilities over the past year.
A considerable number of the fee-earner and partner hires across the top 25 are in litigation and regulatory practices, suggesting that bank-on-bank litigation may finally be coming through - a thesis corroborated recently by The Lawyer’s top 10 cases (The Lawyer, 11 January). Out of 14 fee-earner hires at DLA Piper, for example, six were in its litigation and regulatory division.
DLA Piper chief executive Nigel Knowles said: “What we’re finding is that we’re getting involved in far more cross-border litigation and arbitration. We’re the right size for the amount of work we’ve got going on, but we’re always looking to grow in areas of the economy that are set to expand.”