Freshfields Bruckhaus Deringer is to give a no-strings cash payment to trainees not offered a job after it emerged that the City firm will take on only 70% of its qualifying trainees in September.

The move comes as the magic circle law firm confirmed that 70% of its current September qualifying class – around 34 out of 50 – will be offered a position.

This number is significantly down on last September's intake, which saw a 91% retention rate. Freshfields took on 86% of trainees qualifying in March.

The firm would not confirm on the size of the cash payment it was making to the outgoing trainees, but said that it was also offering career support to help them in their next move.

A spokesperson at the firm commented: "Despite challenging market conditions, we have worked hard to maintain a reasonable trainee retention rate as well as avoid a redundancy programme".

The move comes as a number of City firms move to cut their junior intake in response to the recession, with a string of major practices also requesting incoming trainees to defer.

In March Allen & Overy said that it would likely be likely to retain only 70% of its trainees qualifying in September 2009 and March 2010. Meanwhile, A&O also this month confirmed that it 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.

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