Allen & Overy (A&O) is set to reduce its annual trainee intake, as the firm becomes the latest in the City to ask future trainees to defer.

The magic circle firm is planning to take on 105 trainees a year from September 2011 – a drop from the 120 it currently recruits across its September and March intakes.

In addition, following a review of its trainee recruitment processes, the firm has asked trainees set to start between September 2009 and September 2011 to push back their start dates by either six months or a year. The firm is hoping that around 10 trainees from each year will defer.

Deferrals are voluntary, with the firm offering £4,500 for those who defer for six months and £9,000 for those deferring for 12 months.

A&O is offering an additional £2,000 (for those deferring by 12 months) and £1,000 (for those deferring by six months) to undertake community or pro bono work during their deferral period.

Trainees were informed this week, making A&O the latest in a raft of City firms to offer a cash incentive to defer.

The news comes just a week after the firm finalised details of its global restructuring, with around 450 staff members, including 47 partners, leaving the firm. More than half of the cuts, which represent 9% of partner, associate and support staff headcount, affect the firm's London office.

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