London lawyers have already got 180,000 reasons to decide on a job with a US giant in town – provided they’re willing to sacrifice their personal lives, get used to 3 hours of sleep an evening and wait for the inevitable burnout.
However, many US law firms are sweetening the offer by offering young millennials the chance to involve their friends within the fight for juicy financial rewards.
After raising starting salaries for newly qualified junior lawyers to over £180,000 ($236,000), US law groups reminiscent of Kirkland & Ellis and Paul Weiss are expanding referral bonus schemes that supply juniors a £38,000 ($50,000) bonus for recommending a future colleague. The incentives come as law firms are battling for a shrinking talent pool after signings picked up again this 12 months.
US firms had already increased starting salaries for newly qualified lawyers at the start of the 12 months. Quinn Emmanual and Gibson Dunn Offer a salary of £180,000 for junior lawyers in May.
The UK-based “Magic Circle” law firms are struggling to maintain up. Almost all of them, including Clifford Chancehave raised their starting salaries to £150,000 ($197,000) to match their U.S. counterparts in London, sparking fierce competition for higher wages.
Referral bonuses provide employees with the chance to extend their overall salary. It will also be useful for the corporate because it saves on the exorbitant fees charged by large recruitment firms.
Etiquette often requires that two employees participating on this program split the bonus between themselves, in order that each of them receives $25,000 if their application proves successful.
Busy life
While the lavish salary packages being paid out this 12 months represent lucrative dollar signs for young, hungry lawyers, they need to still proceed with caution.
Large law firms are notorious for offering latest hires a grueling work schedule as soon as they walk through the door: putting in hundreds of billable hours to push through major financial transactions.
In fact, employees who recruit their friends on this hectic environment will not be friends of the great old days.
“I think most lawyers would not recommend it to their own children or friends and relatives,” said a senior attorney who previously worked at Magic Circle and U.S. law firms. AssetsHowever, anyone who’s already working within the industry probably knows what they’re entering into.
“People are paying to lose control of their own lives. I think that’s why there are higher salaries and these referral bonuses,” she said.
“I remember pulling several all-nighters and being within the office practically the entire time.
“You mainly haven’t any control over your individual life and your social life and don’t know when you possibly can go to the gym or when you possibly can meet friends.
“I would say it’s going to be hard to find a lawyer in a firm in the city who hasn’t experienced burnout. And if they haven’t felt it yet, they’re going to feel it at some point in the next six to 12 months.”
Lawyers at large firms often get bored with the grind after just a few years, she says, however the pressure to get just a few more years of experience and the prospect of seven-figure salaries can keep them on the job for much longer.
Referral bonuses are a strategy to keep current employees tied to the corporate for longer while they wait out their friend’s notice period on the old company and the following probationary period.
She fears that rising salaries aren’t good for the legal ecosystem as an entire.
“People are throwing huge amounts of money away on the problem,” she says, adding that this may lead to higher fees for the businesses willing to pay for his or her services.
