Three prominent US firms have substantially increased their London newly qualified (NQ) pay this January. This move highlights the ongoing competition among firms and underscores the escalating stakes in the quest for top legal talent.
Ropes & Gray Leads the Charge
Ropes & Gray has taken a bold step by raising its NQ pay from £147k to £165k, effective January 1st. This significant adjustment reflects a shift towards more competitive compensation packages within the industry. Moreover, the firm has also boosted salaries for its trainees, with first-year trainees now earning £60k, up from £57.5k, and second-year trainees receiving £65k, an increase from £62.5k.
Sidley Austin and Paul Hastings Follow Suit
Following suit, Sidley Austin has increased its NQ pay to £166.5k from £159.5k, further amplifying the upward trend in NQ remuneration. Similarly, Paul Hastings has opted for a substantial raise, elevating pay for its newly qualified solicitors from £164k to an impressive £173k.
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The £170k+ Club Expands
These adjustments place Ropes & Gray, Sidley Austin, and Paul Hastings among the elite £170k+ club, joining prestigious firms like Akin Gump, Kirkland & Ellis, Latham & Watkins, and Vinson & Elkins. This club represents the upper echelon of NQ salaries, reflecting the fierce competition for legal talent among top-tier firms.
Shifts in the Legal Landscape
NQ salaries serve as a critical benchmark for attracting new talent, often setting the tone for compensation trends within the industry. While wages for higher-level positions vary based on performance and other factors, NQ pay has emerged as a frontline battleground for firms seeking to attract and retain top graduates. However, some within the legal community voice concerns about salary disparities and the allocation of resources toward junior associates.
Escalating Competition
The escalation in NQ pay is evident as firms vie for top talent. Cleary raised its NQ pay to £164.5k in January, while Davis Polk and Weil now offer £170k to their newly qualified solicitors. Although UK heavy hitters have yet to match these figures, there have been notable increases across the board, with all five Magic Circle firms elevating NQ salaries to £125k.
Diverse Compensation Landscape
While US firms lead the charge in NQ pay increases, other notable players like Herbert Smith Freehills, Hogan Lovells, and Mayer Brown continue to offer competitive base salaries for London NQs, ranging from £120k to £125k.
Firm Responses
Ropes and Paul Hastings remained silent when reached for comment, letting the figures speak for themselves. Sidley Austin, on the other hand, declined to provide further commentary, indicating confidence in its revised compensation structure.
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