- Date
- 14 July 2021
Burnout and Big Bonuses - The Demand for Associates
US law firms in the City are struggling to retain their associates. The solution? Hefty sign on bonuses to lure lateral hires.
The Lawyer reports that as a result of busy deal activity and rising workloads at firms like Kirkland & Ellis (Kirkland) and Latham & Watkins (Latham), associates are now expected to bill around 2500 hours a year to qualify for bonuses. Many of these firms are seeing a high turnover rate as their associates grapple with burnout. This has driven a high demand for mid-level lawyers, particularly those between two to seven years post qualification who are primed to take on the heavy workloads. Kirkland has reportedly offered sign-on bonuses of up to $100,000 for magic circle associates, while Latham has offered between $20,000 and $50,000.
The Magic Circle are also struggling with similar problems. According to one source in The Lawyer, Clifford Chance and Freshfields Bruckhaus Deringer have started recruiting associates from abroad, offering up to £20,000 for their quarantine hotel stay.
SQE Providers - Which schools do firms prefer?
Clifford Chance (CC) has selected the University of Law (ULaw) to provide LPC and SQE training to its future trainees. This means that ULaw beat out CC’s current LPC and GDL provider, BPP University (BPP). One reason for this switch in providers could be that BPP has suffered from a range of damaging allegations recently. In July last year, a group of students at BPP published an open letter complaining about the university’s failure to provide adequate teaching to students during the lockdown.
Additionally, allegations were made that BPP prioritised materials for training contract offer holders at a consortium of six city firms (Freshfields Bruckhaus Deringer, Herbert Smith Freehills, Hogan Lovells, Linklaters, Norton Rose Fulbright and Slaughter and May) ahead of other students. There could also be additional uncertainty over BPP’s management after its recent acquisition by TDR Capital. While BPP and ULaw have traditionally been the two main providers of post-graduate legal education in the UK market, some firms have chosen newer providers in the market. Reed Smith has chosen an Australian founded school College of Law and Barbri International to jointly provide SQE courses for its trainees.
‘Business as usual’ – the notable deals and cases which went ahead this week:
DLA Piper is advising Phillip Morris on its £1bn acquisition of pharmaceutical company Vectura. Vectura are long-standing clients of Clifford Chance. Earlier this year, private equity firm Carlyle had made a bid for Vectura but the deal eventually fell through.
Allen & Overy and DLA Piper advised Australian company PEXA on its $2.5 billion initial public offering in Australia. While A&O were advising PEXA itself, DLA Piper advised one of PEXA’s main shareholders Link Group on retaining its 44% stake in the company.
US law firms in the City are struggling to retain their associates. The solution? Hefty sign on bonuses to lure lateral hires.
The Lawyer reports that as a result of busy deal activity and rising workloads at firms like Kirkland & Ellis (Kirkland) and Latham & Watkins (Latham), associates are now expected to bill around 2500 hours a year to qualify for bonuses. Many of these firms are seeing a high turnover rate as their associates grapple with burnout. This has driven a high demand for mid-level lawyers, particularly those between two to seven years post qualification who are primed to take on the heavy workloads. Kirkland has reportedly offered sign-on bonuses of up to $100,000 for magic circle associates, while Latham has offered between $20,000 and $50,000.
The Magic Circle are also struggling with similar problems. According to one source in The Lawyer, Clifford Chance and Freshfields Bruckhaus Deringer have started recruiting associates from abroad, offering up to £20,000 for their quarantine hotel stay.
SQE Providers - Which schools do firms prefer?
Clifford Chance (CC) has selected the University of Law (ULaw) to provide LPC and SQE training to its future trainees. This means that ULaw beat out CC’s current LPC and GDL provider, BPP University (BPP). One reason for this switch in providers could be that BPP has suffered from a range of damaging allegations recently. In July last year, a group of students at BPP published an open letter complaining about the university’s failure to provide adequate teaching to students during the lockdown.
Additionally, allegations were made that BPP prioritised materials for training contract offer holders at a consortium of six city firms (Freshfields Bruckhaus Deringer, Herbert Smith Freehills, Hogan Lovells, Linklaters, Norton Rose Fulbright and Slaughter and May) ahead of other students. There could also be additional uncertainty over BPP’s management after its recent acquisition by TDR Capital. While BPP and ULaw have traditionally been the two main providers of post-graduate legal education in the UK market, some firms have chosen newer providers in the market. Reed Smith has chosen an Australian founded school College of Law and Barbri International to jointly provide SQE courses for its trainees.
‘Business as usual’ – the notable deals and cases which went ahead this week:
DLA Piper is advising Phillip Morris on its £1bn acquisition of pharmaceutical company Vectura. Vectura are long-standing clients of Clifford Chance. Earlier this year, private equity firm Carlyle had made a bid for Vectura but the deal eventually fell through.
Allen & Overy and DLA Piper advised Australian company PEXA on its $2.5 billion initial public offering in Australia. While A&O were advising PEXA itself, DLA Piper advised one of PEXA’s main shareholders Link Group on retaining its 44% stake in the company.
