James Rossiter, Professional Services Correspondent
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About 200 lawyers at City legal practices will earn more than £1 million this year, reflecting the dramatic increase in mergers and acquisition work.
Clifford Chance, the world’s largest law firm, will break the million-pound profits per partner barrier for the first time.
That rise alone will account for scores more lawyers earning seven-figure sums.
However, it will be Slaughter and May, the City’s premier corporate firm, whose 120 partners will be earning the most.
They will average about £1.5 million, but longer-serving partners could earn as much as £2 million.
They are expected to include the corporate partners Nigel Boardman and Steve Cooke and the senior partner Tim Clark.
The astonishing rise in profitability mirrors the dramatic rise in the volume and value in UK and international corporate takeover work.
That frequently results in partners as well as junior lawyers, both at UK and US-owned firms, working seven days a week for weeks at a time to seal deals.
Partners at Linklaters, a rival for Clifford Chance in its international reach, should see average profits per partner increase to about £1.2 million, close to a 20 per cent rise compared with last year.
Turnover is expected to rise 15 per cent to more than £1 billion for the first time.
That will mean earnings of up to £1.5 million for Tony Angel, the managing partner, and David Barnes and David Cheyne, who are corporate partners.
Average earnings for partners at Allen & Overy may exceed £800,000 this year, but at least 20 will earn more than £1 million.
Guy Beringer, senior partner, is understood to be one of the highest paid. He said: “It has been a very good year. There is a strong international M&A market and it clearly plays to the strengths of larger firms.”
The rise in profitability at the UK’s largest law firms will narrow the gap in earning power between the City’s top legal eagles and Wall Street’s finest and trigger hopes of a large-scale transatlantic legal merger over the next few years.
Skadden Arps Slate Meagher & Flom, America’s largest law firm, where partners can regularly earn $3 million ($1.5 million) a year, has expanded in London by hiring young lawyers with the promise of big work and big money.
Scott Simpson, Skadden’s London-based cross-borders merger expert, will be one of the City’s highest earners this year.
A senior insider at Clifford Chance, the first firm a year ago to top the £1 billion mark for revenue, said: “We will touch a million pounds each this year. You will see more million-pound earners than ever before. Weekends and Bank holidays have not existed — you have to be available at all times.”
David Childs, the Clifford Chance managing partner, will be one of the firm’s leading earners.
City law firms’ financial year-ends came to a close last week.
Ashurst increased its revenue 28.5 per cent to £275 million.
Average profits per partner are expected to rise up to 20 per cent to about £850,000, but 30 of its 130 equity partners should exceed the £1 million mark.
Similar profits are expected at Herbert Smith.
Geoffrey Green, Ashurst senior partner, would say only that there would be a “definite increase in profitability” but added: “Here corporate work is a greater proportion of the whole. In the slowdown of 2001 London firms suffered more but that gives a big bounce-back now.”
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how can you say that lawyers are not passionate about their jobs? i am a first year law student who dreams of being a solicitor. I can see only from doing A Level Law and from my first year exams how hard these solicitors work. They deserve every penny. They are far from imbeciles!
Lucy, Cambridge,
"Does it infer . . .". It appears that "Wing" from Poole wants to be the new Ali G.
Farouq Mahoud, Brighton, UK
No solicitor is "passionate" about there job.
Dr. Conor Maguire, Foxrock, Ireland., Ireland
I am a Law Graduate from Republic of Ireland (and due to finish my legal training soon), I understand how to transfer the Irish Solicitor Qualification to the U.K. but I am eager to know if Irish Legal Graduates have a chance to be highly succesful in The City of London ? One must remember that there are a smaller number of Law Schools in Ireland ! Thanks for your help !
CW, Galway, Ireland
Having completed a law degree at one of the major British Universities that feeds the likes of the Magic Circle law firms I find some of these rather ill-informed posts rather insulting. I have much admiration for the solicitors who work in these firms. It takes an enormous amount of hard work to gain the grades required to obtain a job with City law firms, and they really do get their pound of flesh in terms of the hours the Solicitors work. I am pleased to say that working for a corporate giant did not appeal to me thus I have my own business instead.
The comments regarding the money seem rather ridiculous, at the end of the day businesses exist to make money, law firms are equity partnerships thus the more money the firm makes the more the partners earn. I think it's also sad to suggest that all the Solicitors are after is the money, from the many Solicitors I know the majority it because they have a passion for their jobs.
Matt, London,
Shobal your coments don't really stand up. Firstly high earning partners in City law firms are not going to become part of the judiciary. Members of the judiciary are overwhelmingly former barristers, while the partners in these firms are solicitors. While it is now possible for solicitors to become judges very few have done so and those that have are litigators, whilst the majority of the partners we are talking about here do transactional work. Secondly there is a market in the UK for legal services and while not entirely free it is one of the least protected in the world. If the fees charged were truly disproportionate, then they would be driven down by competition. Thirdly English law firmshave been the most succesful in expanding overseas. If they were as poor as you made out then they would not have succeeded in breaking into overseas markets where local firms were already entrenched.
Jack, Richardson, London
What people forget is that we all have to pay for these massive salaries which bear little relationship to effort and skill.
The transfer fees and salaries of footballers translate into ticket and shirt prices for fans. The lawyers' fees say for the Boots acquisition will translate into the prices for prescriptions paid for by the NHS and then back into taxation for us. The failed acquistion of Sainsbury's will have resulted in massive fees for lawyers, irrespective. That cost goes on to say the price of a tin of baked beans, less money for store improvements, less dividends for shareholders or less money for its pensioners.
There is of course no such thing as a free lunch - unfortunately it is we ordinary mortals paying for that lunch ! And we do not even get an invite.
Mike, Leatherhead, England
Some people do worship money and that is their choice. I personally value a work life balance which hampers my own professional ambitions and there is only so many hours I am willing to work. It is a short life and I firmly believe you should try to enjoy it. These people obviously have different priorities and good luck to them. Soem of them will actually thrive on the work. At least with these lawyers it is diffcult to argue they don't earn it (unlike with footballers for example, some of whom make these lawyers look poor) with the hours, pressure and complexities of the work they do.
Lee Chappell, Bristol, England
My son is a corporate City lawyer and he earns every penny. He is often working for weeks at a stretch until midnight and under great pressure.
I don't know where Chie of Tokyo, gets his ideas from, talking about imbeciles. And, by the way, there is no such word as "subliterate" . Try finding out what education and hard work it takes to land a job as a City corporate lawyer.
And on a factual point, Wing of Poole, corporate law has nothing to do with judicia work.
I think there are a lot of sour grapes here -, but it isn't a restricted profession - go and do it if you think you can.
D James, Lancashire, UK
Yet another reason for mediocre City lawyers (i.e. most of them) to overrate themselves. When you read the work (contracts, letters etc.) these subliterate imbeciles produce, you wonder how any of them manage to keep their jobs, let alone get paid small fortunes!
Chie, Tokyo, Japan
It is wonderful to be informed that so many high flying lawyers are raking it in. Does it infer that we have the best judicial system money can buy?
Wing , Poole, UK
Money, money, money. This reads like an annotated chapter from Dickens. It's all very sad. Still one would imagine they think they're happy.
mark, perth, australia
And once the millions have been earned(through sheer hard work and no bill padding etc), of course, you become part of the judiciary and serve others striving to reach similar ambitions. Another blow to public confidence as this is a further example that elitism actually works. No wonder international companies want to go elsewhere rather than pay those hefty,disproportionate, and poorly transparent fees in London. In time,the bubble will burst just as it happened with regard to one time lucrative darling of the legal profession, legal aid.
Shobal Sinha, Dorset, UK
We all worship a God, whatever protestations we have about being agnostic. Some worship a God of religion - others worship money!
Steve, London, London, UK
Absolutely. Such tidy sums should pay nicely for the divorces and kids' counselling sessions arising from leaving families across holiday periods, weekends and other special occasions. Sterling work chaps ! Sterling work !
Drew Wells, London, UK