Big name, big pay, even bigger hours: Welcome to City law firms
The salaries of junior lawyers is a topic that sparks headlines, adding even bigger sparks to debates over 20-something-year-olds pocketing hefty wage packages. However, considering the hours they work and what is expected of them, the money is earned.
US firms, many of which now dominate London, not only compete over lawyer rates but also create a pay war for junior lawyers. For years, the battle over who is increasing their newly qualified (NQ) salaries has dominated news cycles, as some City firms have increased the starting package to over £150,000.
The top ‘starting’ salary in the City currently stands at £180,000, following the increase in NQ pay by US firms Gibson Dunn and Quinn Emanuel last year.
The primary reason is that most US firms in the City don’t invest early on; many American law firms in London only offer a small cohort of training contracts, compared to their English counterparts.
Instead, US firms wave the big bucks when these trainees are qualified and snap them up from their competitors.
If you ask a 20-something-year-old, ‘Hey, would you like to join us? We will pay you £180,000 annually, with bonuses?’ most will snap it up with their hands; they would be stupid not to. Wouldn’t they?
There is a real drive to get into these top City firms, but those juniors who have parents or family in the legal field are already understand what will be expected of them.
However, from the rush of students who view their future career through the lens of TV shows such as Suits, to others who are encouraged through ‘a day in my life’ videos on TikTok, they may not see what is behind the £150,000 or £180,000 salary.
I’ve seen several ‘day in the life as a junior lawyer in London’ videos on my feed. These often present a highly curated version of reality—some even depict junior lawyers leaving the offices of top City firms as early as 5pm, which is hardly representative of the true demands of the job.
Long hours, long days
This is highlighted by Legal Cheek’s latest research on over 2,000 trainees and junior lawyers, which shows that most junior lawyers at leading City law firms regularly work well beyond standard hours, with many reporting that the youngest staff routinely put in over 12-hour days.
Even less surprisingly from this data was the fact that the top US law firms were leading the table.
There were 14 law firms listed, with an average finish time of 9 pm or later. Milbank, which pays NQ $225,000, topped the list, with lawyers reporting that they often worked around 13 hours a day, frequently leaving the office after 10 pm.
However, the big English firms, which include Linklaters and Clifford Chance, stand out near the top, with their junior lawyers working more than 11 hours and 40 minutes each day. These two firms are among the highest-paying British headquarters firms, offering £150,000 starting salaries for new recruits.
The data shows why there is a salary war in the City over the young talent the firms need.
If Gibson Dunn offered a job with a £180,000 salary, where the report said most junior lawyers work an average of 11 hours 48 minutes a day, why would you pick some of the others on the list who offer much less of a salary for not much less of a workday?
What really is the difference between an average one hour and 30 minutes extra every day in exchange for a £50,000 to £80,000 bump in their earnings?
Truth be told, businesses are not happy with this pay war, as the costs of these juniors will essentially be passed on to clients. They also push up salaries all the way up the chain. And most middle-tier law firms are also struggling, as many can’t participate in the pay war now the costs have become too high.
Yet, most law firms in the City are growing, both in terms of headcount and profitability. For the best and brightest, many need to play the game that the American firms started or be left on the sideline.
However, with Gen-Z making up most of the junior lawyers, it is not just about the money, which is why some firms are trying to offer enhanced career development plans, such as McDermott Will & Schulte, or experimenting with a policy of not disturbing lawyers while they are on holiday, such as Mayer Brown.
As law firm boards continue to figure out how to attract and retain good talent, the next battle will be how to stop burnout among a generation worked for every pound they earn – and for every waking hour.
If only the reality of long hours were as easy to edit as a TikTok clips.
Eyes on the Law is a weekly column by Maria Ward-Brennan focused on the legal sector.