Legal Business

Remuneration overhaul: DLA Piper votes to increases bonus pool and launches mini-lockstep

Posted on |
Financial management DLA Piper
legal-business-default

DLA Piper International partners have approved an overhaul of its pay structure, introducing a points-based remuneration system and a larger bonus pot as it targets greater profitability, while bringing in a separate lockstep for new partners while they grow their practices.

Partners from the international LLP of DLA Piper, covering offices in Europe, Asia-Pacific, the Middle East and Africa, voted in favour of plans to bring in a points system as the firm moves towards a reward structure based on profits. While 75% of the partnership vote was required to implement the changes, 94% approved the plans in January.

DLA Piper will introduce a banded system where partners are assigned points matched to a profit share. The band extends at the top so that only the best performers can enter the highest-paid bands. This moves the firm away from a less standardised process, where partners are currently handed an annual payment based on performance over the year.

Co-chief executive Simon Levine (pictured) said: ‘The benefit of a structured points system is that it brings clarity and order to your partnership remuneration system. Rather than everyone being on their own deal, with 500 different types of structure, you have a set amount of bands. It’s a meritocracy but with a level of order, like in a lockstep. The difference is that you don’t automatically go up for every year you’ve been with the firm, you go up or down based on performance.’

As part of the proposals, DLA Piper’s international LLP will also introduce more flexibility to its bonus system, with the bonus pool shifting from 5% of the group’s profit to a range of 4-8%. There is no maximum placed on what star performers can be paid in bonuses.

A mechanism has also been brought in to end the fluctuation of take-home pay for new partners. A mini-lockstep has been introduced whereby newly promoted partners will move up a band a year for their first three years in the partnership.

Levine explained: ‘We are very keen to give our new partners comfort and support as they look to build their business. It’s a massive statement from the firm, and a testament to the partnership, that we want to nurture and support our senior associates to partner and beyond. We’re trying to build a culture that makes people want to remain here for the long-term.’

‘This is the biggest change to the firm’s remuneration in recent history. We’ll have a structured points system that enables partners to clearly see the link between billing collection and what they take home. It’s not an artificial profit share as if you’re an employee. You’re a part-owner of the business. You can explain to partners how much an investment will cost per point so they can see the level of investment they are agreeing to. You can also focus more heavily on profitability. People obsess about turnover and, while turnover is important, what ultimately matters is profitability,’ he added. 

tom.moore@legalease.co.uk

Legal Business

DLA Piper expands Nordic footprint with Finnish tie-up

Posted on |
Legal mergers DLA Piper
legal-business-default

DLA Piper has agreed a combination with 30-lawyer Finnish law firm Peltonen LMR as it expands its Nordic footprint.

The firm’s latest expansion sees 30 lawyers in Helsinki join its ranks. The addition means the firm’s pan-Nordic presence, with offices across Finland, Norway and Sweden, is home to over 200 lawyers.

Peltonen has strong local practices in banking, corporate, dispute resolution and IP. The firm counts Finland’s export credit agency Finnvera, the City of Helsinki and Nordea Bank as clients.

Peltonen was run by chairman Leif Itäinen, a corporate lawyer, and managing partner Johan Schmidt, a competition lawyer. Schmidt has a strong profile across the Nordic region due to his former role as vice president of Nokia Ventures Organization, a fund the mobile phone company used to develop new technology.

The firm has also rolled out integration plans, with the Nordic region forming part of DLA Piper’s EMEA practice led by co-managing directors Barbara van Hussen and Juan Picon.

DLA Piper global co-chief executive Simon Levine said: ‘As part of our vision to be the leading global business law firm, a key part of strategy is to operate in all the major world economies and other important markets where our clients are based or do business. Together, the Nordic countries rank as a G20 economic entity and the region is home to some major international corporates. Many of our existing clients do business in the Nordic region and we believe they will benefit from our enhanced presence there.’

Picon added: ‘We are excited at the prospect of being able to offer the market a true pan-Nordic capability. Frankly, we were surprised that no other firm has succeeded in developing such a capability and having talked to our clients and other institutions who operate across the region, we believe that the market will respond positively to what we are doing.’

tom.moore@legalease.co.uk

Legal Business

Finance push: DLA Piper ramps up City offering with Latham hire

Posted on |
Strategic recruitment DLA Piper
legal-business-default

Fresh from hiring Slaughter and May’s ex-head of derivatives Mark Dwyer and Baker & McKenzie’s former head of structured capital markets Vincent Keaveny, DLA Piper has added Latham & Watkins partner Andy Kolacki to its London office as it pushes its finance credentials in the City.

Kolacki leaves Latham after over a decade at the US firm and joined the the partnership in 2009. He started his career at Magic Circle firm Freshfields Bruckhaus Deringer.

Kolacki specialises in US style financing used on cross-border loan packages, including US Term Loan B, a covenant-lite structure that is being increasing used in the European finance market due to the borrower-friendly terms that have not been readily available from the European banks.

DLA London head of debt finance David Miles said Kolacki’s arrival ‘will add bench strength to our team at a time when the markets are looking more and more to US style financing techniques’.

The appointment comes as part of a global finance push by DLA, with banking and financial services picked as one of the firm’s seven sector pillars earlier this year when DLA launched a condensed sector strategy. The firm appointed London-based Philip Butler as co-head of its global banking group in September last year in a move designed to place greater focus on the firm’s City operation.

There has long been a feeling inside the firm that DLA has underinvested in its London office, but the appointment of Simon Levine as Sir Knowles’ replacement as co-chief executive at the start of 2015 has seen a greater emphasis on profitability and a string of senior City hires.

Dwyer, whose practice covers derivatives, capital markets and leveraged financings, become one of just a handful of Slaughters partners to have moved to another major law firm when he joined DLA in December. Keaveny, Bakers’ former head of structured capital markets, was part of a successful four-partner lateral hire from Norton Rose in 2005 alongside Jonathan Walsh, Simon Porter, Bruce Somer almost a decade ago.

The firm has also taken Simmons & Simmons international commercial practice head as it builds up its commercial contracts practice. Mark Dewar, who had been at Simmons for 28 years, joins DLA’s London office with senior associate Michiko Jo.

tom.moore@legalease.co.uk

Legal Business

Revolving doors: DLA Piper makes commercial contracts play, as Global 100 firms make key hires

Posted on |
Strategic recruitment DLA Piper
legal-business-default

In a busy start to the year, DLA Piper has strengthened its commercial practice with the appointment of two lawyers from Simmons & Simmons, while Global 100 firms K&L Gates, Cooley and White & Case have all made lateral hires.

DLA has taken Simmons’ international commercial practice head as it builds up its commercial contracts practice. Mark Dewar, who had been at Simmons for 28 years, joins DLA’s London office with senior associate Michiko Jo.

Dewar’s expertise is in supply chain contracts, consumer product issues and commercial transactions involving consumer finance businesses. DLA global co-head of commercial contracts and distribution Iain Bowler said: ‘Mark’s experience is unsurpassed and with the addition of Michiko we will be able to offer clients an even deeper sector expertise which covers the spectrum of commercial and business law issues.’

Dewar’s move follows DLA’s hire of Slaughter and May finance partner Mark Dwyer, who moved along with Baker & McKenzie structured finance veteran Vincent Keaveny in December.

Meanwhile, K&L Gates has added Pinsent Masons partner John Gilbert to its London energy and arbitration practice. Gilbert has experience working in the dispute resolution team at BP and his experience includes oil and gas exploration, construction, and power generation.

K&L Gates London administration partner Tony Griffiths said: ‘With price pressure affecting the oil & gas industry, we have seen increased demand for dispute resolution advice.’

In Europe, Ashurst has hired Alexander Ballmann from CMS Hasche Sigle, the German arm of the CMS group. Ballmann will join Ashurst’s Munich office as partner in its global restructuring and special situations group. He is the third new partner to join the German practice in the last five months, following the appointments of M&A partners Thomas Sacher and Detmar Loff, who joined from Allen & Overy in October. Going the other way, Ashurst has lost restructuring partner Ingo Scholz to Weil, Gotshal & Manges. Scholz was a partner at Ashurst since 2006 as particular expertise in complex bondholder restructurings and joins Weil’s Frankfurt office. 

Further afield, Cooley has expanded its global M&A practice with the hire of Steven Tonsfeldt, who joins from O’Melveny & Myers where he was the chair of global M&A and private equity. A 25-year veteran of Silicon Valley, Tonsfeldt’s practice focuses on domestic and cross-border M&A transactions, contested transactions, hostile takeovers and defence planning.

In Asia, White & Case has hired Paul Hastings partner Catherine Tsang to join its Hong Kong office. Tsang specialises in corporate transactions and capital markets, and has more than 15 years’ experience.

White & Case Asia head Eric Berg said: ‘Catherine’s arrival, which follows the recent additions in Asia of private equity and corporate partners Peggy Wang and KS Kim, reflects our ongoing ambition to expand our M&A and capital markets capabilities across the region.’

victoria.young@legalease.co.uk

Legal Business

DLA Piper pay to highest earning LLP member nears £2m despite firm’s profit dropping

Posted on |
Salaries DLA Piper
legal-business-default

The highest-paid LLP member at DLA Piper International took home £1.96m last year, 8% more than the biggest payout last year, despite the firm’s profit dipping.

The biggest earner at DLA Piper’s non-US operations trousered £1.955m in 2014/15, according to the firm’s latest filings at Companies House which covers the UK businesses as well continental Europe, Asia, Australia and the Middle East.

This constitutes a £155,000 rise on the previous year when the highest payout was £1.8m. The figures in the LLP accounts do not necessarily equate to the highest paid equity partner and can relate to ‘golden handshakes’ to retiring members.

The accounts also showed the firm’s profit dropped from £277m to £270m during Sir Nigel Knowles’ last year as chief executive, with turnover falling by 3% from £787.6m to £765.7m. Knowles’ replacement, Simon Levine, has been at the helm since 1 January 2015.

Total staff numbers also fell slightly, from 5,071 to 4,926, largely due to the firm’s profitability drive. Support staff figures fell from 2,620 to 2,557 as equity partners dipped from 703 to 676.

In the UK alone, the number of lawyers at the firm dropped, from 1,005 in 2013/14 to 982 last year, while the number of support staff decreased by three to 1,477. Overall employee headcount fell from 2,687 to 2,630, while the number of equity partners in the UK fell from 345 to 331.

A breakdown of revenue by region showed turnover fell in the UK, continental Europe and Australia. Its practice across continental Europe was hardest hit, experiencing a 6% decline in turnover to £289.7m. Revenue in Australia also fell from £101m to £92m following a restructuring carried out by chief operating officer Andrew Darwin.

However the firm saw improved revenue in Asia, where turnover rose from £72.3m to £73.57m.

While the highest paid at DLA took home almost £2m, other firms to file accounts today reported more modest payouts. The highest LLP member at Stephenson Harwood took home £1.3m during the last financial year, while at Fieldfisher the payout was £1.24m.

tom.moore@legalease.co.uk

Legal Business

Revolving doors: DLA and Stephenson Harwood make key hires as Gordons loses property litigation head

Posted on |
Strategic recruitment DLA PiperStephenson Harwood
legal-business-default

After announcing two major City finance hires last week, DLA Piper has hired Paul Reeskamp as a partner in the firm’s IP and technology group. Reeskamp joins the Amsterdam office from top tier Dutch IP outfit Klos Morel Vos & Reeskamp, where he was partner and head of patent litigation, and brings with him associate Marijn van der Wal.

DLA international group head of IP & technology Stephane Lemarchand said: ‘As a firm, we are committed to offering a top-notch European patent practice when the Unified Patent court system comes into effect and Paul will be a significant addition to our team.’

Eversheds has also made a key IP hire, appointing Deon de Beer as a partner in the firm’s Johannesburg office. De Beer is a patent attorney who joins from Dessington de Beer attorneys and represents clients in a variety of technical fields including material science, mechanical and software.

Eversheds also announced last week the hire of Gordons head of property litigation Andrew Todd. The expansion of the firm’s property team follows the recent hire to the Eversheds property practice of Pinsent Masons head of real estate litigation Stuart Wortley in September. Eversheds head of real estate litigation Paul Moorcroft said the appointment means the firm has 13 real estate litigation partners in the UK alone. He added: ‘It is a busy time and we are keen to keep adding to our senior resource, as we win new mandates and are increasingly instructed on high profile disputes. Andrew is known to many of us and will be a real asset to the team.’

Going the other way, Eversheds partner Jane Marshall is departing for Weightmans. Pensions and employment partner Marshall has more than 14 years’ experience and advises clients in local and central government, education and health sectors.

Stephenson Harwood has hired Wragge Lawrence Graham & Co (WLG) corporate finance partner Karima Hudson. Hudson, who had led WLG’s healthcare practice, is well-known in the healthcare sector and recently advised Formation Capital LLC on its £477m acquisition of NHP.

Watson Farley & Williams (WFW) has boosted its tax practice in London with a new hire from Deloitte. Tom Jarvis will join as a tax partner, having been a director in the Big Four firm’s M&A and funds tax group. WFW managing partner Chris Lowe said: ‘As a firm our focus continues to be providing cross-border legal advice within our core sectors and, with the addition of Tom, WFW can continue to build on our ability to provide extensive tax services across the firm’s core sectors.’

Meanwhile EY has hired Matthew Whalley as a director to lead the its legal risk practice. Whalley joins from Berwin Leighton Paisner (BLP) where he started the firm’s risk practice. EY financial services UK law leader Matthew Kellett said: ‘At a time when the regulatory lens is so keenly focused on how financial services firms are managing their risk, Matthew’s expertise will be extremely welcome to our financial services clients.’

victoria.young@legalease.co.uk

Legal Business

DLA Piper pushes finance credentials with senior hires from Slaughters and Baker Mac

Posted on |
Strategic recruitment DLA Piper
legal-business-default

DLA Piper has made a major finance play in the City with the hire of former Slaughter and May partner Mark Dwyer and Baker & McKenzie structured finance veteran Vincent Keaveny.

Dwyer, regarded as one of Slaughter and May’s most prominent finance partners, left the firm after 20 years. A partner since 2005, he headed up Slaughters’ derivatives practice before retiring from the firm on 31 October.

He becomes one of just a handful of Slaughters partners to have moved to another major law firm, with Graham Iversen’s move to Greenberg Traurig Maher in 2014 and Richard Carson’s transfer to Taylor Wessing in 2012 two rare examples.

DLA’s latest recruit has a broad finance practice which, in addition to derivatives and capital markets, includes investment grade and leveraged financings. He counts 20 of the current FTSE 350 companies as clients.

Dwyer has already started at DLA and is to be joined this month by Bakers’ finance partner Keaveny. A former head of structured capital markets, Keaveny leaves Bakers after 10 years as a partner. He joined the US-based law firm as part of a successful four-partner lateral hire from Norton Rose in 2005 alongside Jonathan Walsh, Simon Porter, Bruce Somer. Walsh is Bakers’ current head of structured capital markets.

Keaveny, who counts German car manufacturer Volkswagen as a client, handles securitisation, structured finance and derivatives mandates.

The arrivals come as part of a global finance push by DLA. Banking and financial services was picked as one of the firm’s seven sector pillars earlier this year when DLA launched a condensed sector strategy. The firm appointed London-based Philip Butler as co-head of its global banking group as part of its sector overhaul in September to work alongside Frankfurt-based Frank Schwem, who was appointed in the summer.

DLA global co-chair of finance and projects Charles Morrison said: ‘Vincent and Mark are both very well-known and highly-regarded finance lawyers with international mind-sets. We are committed to strengthening our finance teams in all the world’s major money markets and are delighted to welcome lawyers of Vincent and Mark’s calibre to the group.’

The firm’s UK head of finance Martin Bartlam added that the hires ‘reflect the repositioning of the firm as a key player in global financial markets’.

tom.moore@legalease.co.uk

Legal Business

DLA strikes landmark deal to offer contract lawyering through LOD

Posted on |
Innovation DLA Piper
legal-business-default

Putting aside the rivalries that result in little collaboration or innovation within the legal market, DLA Piper has struck a highly unusual deal to provide contract services to its clients via Berwin Leighton Paisner (BLP)-owned Lawyers On Demand (LOD).

The move sees DLA team up with LOD to create and manage a contract lawyer business. DLA alumni will be the catalyst for the launch, with around 50 lawyers expected to join LOD by the end of 2016 to service the global law firm when it requires extra resources. LOD’s current pool of 400 lawyers will also be available to DLA.

Legal Business

Asia next target for DLA as it launches third low-cost centre in Warsaw

Posted on |
Europe DLA Piper
legal-business-default

DLA Piper has ramped up its low-cost services offering, opening a centre in Warsaw and eyeing Asia for a fourth base across the globe.

The firm confirmed the creation of a small service centre opened in the Polish capital earlier this month and said it was currently piloting the transfer of some administrative finance, HR, marketing and IT processes there from Germany as well as some HR processes from The Netherlands.

DLA Piper added it was considering opening another services centre in Asia to enable 24/7 support for clients.

Chief operating officer Andrew Darwin said: ‘We are constantly looking at ways in which we can make the firm’s operations more efficient and effective, and piloting Warsaw for inclusion in our global shared services capability is part of that. For EMEA, we think Warsaw could be complementary to what we currently have in place and potentially offers an attractive combination of quality and value.’

Earlier this week, White & Case said it was also considering up a shared services centre in Europe.

EMEA chief operating officer Nick Salmon said: ‘We’re in the very early stages of considering whether or not to set up a shared services centre in Europe. White & Case already has around 450 employees in the successful shared services centres we’ve established in Manila and Tampa, which would limit the scale of any third facility we put in place.’

Meanwhile Freshfields Bruckhaus Deringer established its low-cost services hub in Manchester this year, having taken out office space in October to double its current Manchester base. Staff are expected to move there from early 2017.

victoria.young@legalease.co.uk

Legal Business

DLA strikes groundbreaking deal to offer contract lawyering via LOD

Posted on |
Innovation Berwin Leighton PaisnerDLA Piper
legal-business-default

In a pioneering nod towards calls for the modern legal profession to be more collaborative, DLA Piper has struck a highly unusual deal to provide contract services to its clients via Lawyers On Demand (LOD).

The move sees DLA Piper team up with LOD, which is owned by Berwin Leighton Paisner (BLP), to manage its contract lawyer business via DLA alumni. The deal also has led DLA to cancel plans to launch its own contract lawyer arm.

Under the deal, LOD will manage and oversee a pool of DLA Piper alumni, with 50 expected to join by the end of 2016, who will then service the global law firm when it requires extra resource. LOD’s current pool of 400 lawyers will also be available to DLA Piper.

The deal will also see LOD expand outside of the UK for the first time as it supports DLA Piper’s flexible lawyering service across Europe, the Middle East, Asia and Africa. The venture has already begun rolling out across the UK, with DLA Piper alumni overseas to join LOD with the promise of flexible work in early 2016.

The move is a significant shift in approach to flexible lawyering as other firms have built their own divisions. Freshfields Bruckhaus Deringer launched its alumni service Freshfields Continuum in the summer of 2012, with Allen & Overy and Pinsent Masons following in 2013 with the creation of Peerpoint and Vario respectively.

The project was driven by DLA Piper global co-chief executive Simon Levine with support from service delivery and quality director Stephen Allen, who left his post at Big Four accountancy PwC early last year with the task of modernising operations at DLA Piper. Allen also worked at BLP as its director of innovation and helped establish its Managed Legal Service unit.

The deal looks to be a significant coup for LOD and its ambition to extend its service to other major law firms.

Levine told Legal Business: ‘It’s a commercial deal, [BLP’s stake in LOD] didn’t bother us at all and isn’t a concern. We essentially had two options, one being to build something ourselves but then you either don’t do it properly or it will take you years to get it right. The alternative was to partner with someone who would give us a DLA Piper product that is tailored to the type of service we want to provide our clients. LOD was happy to go into a venture with us as they want to be more international so we had something to offer them as much as they had something to offer us.’

‘The deal allows us to work in a way that is good for our clients and for our workforce and enables DLA Piper to achieve a level of profitability that we need in order to continue to compete in the marketplace. This deal doesn’t mean we will reduce the workforce, these lawyers won’t replace our lawyers, but it changes the mix of labour as we grow.’

Levine said DLA has many lawyers that do not want partnership and have reasons for flexible working. ‘Frankly, we don’t want to lose that workforce. We spend huge amounts of money on people from when they join us from law school. The idea that you would then lose them to other organisations, when they want to stay but just work in a different way, is criminal.’

LOD launched in 2007 and has seen an increasing number of corporates use its services to outsource work or hire lawyers on short-term deals. Its revenue climbed by 42% last year to hit £12.3m for the 12 months to 30 April 2015.

tom.moore@legalease.co.uk