Four of the five Magic Circle firms have now revealed their decisions on newly qualified (NQ) and trainee salaries, with decisions pending from the remainder of the top ten City firms.
Freshfields Bruckhaus Deringer so far tops the table for NQs, despite its decision to freeze pay for its career milestone foundation. Junior-banded associates – equivalent to NQ to one-year PQE – will earn between £65,000 and £72,500. The firm’s trainee pay has also been frozen at £39,000 for first-year trainees and £44,000 for second-year trainees.
Linklaters currently falls in second place after last month increasing its NQ salary from £61,500 to £64,000. However, first-year trainee salaries have this year increased from £39,000 to £39,500, putting the firm marginally ahead of Freshfields.
Linklaters’ NQ increase has also meant it tops Magic Circle rival Slaughter and May, which also this year raised its NQ salaries from £61,500 to £63,000. The firm announced in April that it will raise first-year trainee salaries from £38,000 to £39,000 and second-year salaries from £43,000 to £44,000 – on a par with Freshfields.
Meanwhile, Allen & Overy (A&O)’s decision last month to hold its NQ salaries at last year’s level – £61,500 – means it has fallen to the bottom of the Magic Circle.
However, the firm did raise its first-year trainee salaries in April from £38,000 to £39,000 and second-year trainees now take home £44,000, up from £43,200 – on a par with both Freshfields and Slaughter and May.
Genevieve Tennant, global director of HR at A&O, told Legal Business: ‘The bonus pool is very important in this discussion – our NQs will receive a £5,000 bonus this year and this keeps us at a competitive position. We focus on total rewards and make adjustments where appropriate.’
Clifford Chance is the last of the Magic Circle to announce its decision on NQ and trainee pay. At the time of going to press the firm paid its NQ lawyers £61,500.
The remainder of the top ten UK firms will announce their decision on pay bands over the next two months. Currently, Herbert Smith Freehills, Norton Rose and Hogan Lovells’ NQ lawyers are rewarded £61,500, while DLA Piper and CMS Cameron McKenna both pay £60,000.