White-shoe law firm ups new City lawyers’ pay to £160,000 a year
Cleary Gottlieb has become the latest US law firm to boost salaries in the UK’s legal market after upping pay for newly-qualified (NQs) lawyers in its London office to £160,000 a year.
The white-shoe law firm has given its City NQs a 14 per cent pay rise, in offering to boost their salaries by £20,000 from 1 January 2023.
The pay rises put Cleary Gottlieb in the top ranks of the City pay scale, which is now entirely dominated by US firms.
The £20,000 increases put the New York law firm’s NQ salaries on par with its white-shoe rival Davis Polk & Wardwell, and well ahead of those offered by the UK’s elite “Magic Circle” firms.
Named after distinctive footwear worn at Ivy league colleges, America’s “white-shoe” firms consist of the most prestigious New York and Boston based law firms, accounting firms, and financial institutions.
The law firms are known for filling their ranks with elite Ivy League college graduates and members of the white Anglo-Saxon protestant (WASP) elite.
The pay hikes come as law firms have continued to increase NQ salaries in the face of worsening economic conditions, in a continuation of the years’ long battle for talent between top firms.
The legal sector has for the most part held off from making layoffs, due to fears around struggling to rehire staff when the economy recovers.
Law firms are however placing greater pressure on lawyers to increase their profitability by hitting them with higher billing targets instead.
Founded in 1946 by six New York lawyers, Cleary Gottlieb gained notoriety for its dealings with a raft of Russian companies, including Rosneft and Gazprom.
The pay hike comes just days after New York law firm Weil Gotshal gave its NQ lawyers their third pay rise this year in upping their salaries to £165,000 per annum.