Length of equity ladder under focus in Allen & Overy lockstep review
Allen & Overy (A&O) has become the latest leading City firm to review its partner remuneration structure, while Clifford Chance (CC) has confirmed that it has no plans to alter its existing lockstep model. A&O currently operates a modified lockstep with a 15-year equity ladder from bottom to top, with the firm understood to be considering changes to the length of the ladder.
September 07, 2011 at 07:03 PM
2 minute read
Third 'big four' City firm reviews lockstep but CC rules out changes
Allen & Overy (A&O) has become the latest leading City firm to review its partner remuneration structure, while Clifford Chance (CC) has confirmed that it has no plans to alter its existing lockstep model.
A&O currently operates a modified lockstep with a 15-year equity ladder from bottom to top, with the firm understood to be considering changes to the length of the ladder.
Other proposals include amending the speed of progression through the rungs, with one former partner suggesting the length of time partners remain on the salaried rank could also be extended.
The magic circle firm declined to comment on details of the review but confirmed it would not be moving away from lockstep. The review is being led by the firm's senior partner David Morley and managing partner Wim Dejonghe.
One A&O partner said: "The structure is being reviewed at the moment – the basic idea is to stick with the lockstep. What they would look at would be every other aspect like length of ladder, speed of progression and so on."
A firm spokesperson said: "Matters concerning partner compensation are looked at from time to time but we do not propose to share these outside the firm, beyond confirming that we remain a lockstep firm."
A&O's review comes after Legal Week revealed that Freshfields Bruckhaus Deringer and Linklaters are both currently considering plans to overhaul partner remuneration. In contrast, CC has confirmed that it has no plans to look at its remuneration model.
Senior partner Malcolm Sweeting voiced his commitment to the lockstep culture at the firm, commenting: "Our partners are happy with the lockstep model and I haven't seen anything that persuades me that we need to alter the model. Not only will I not be pushing for this now, I also don't anticipate that I will while I am senior partner."
- For more, see: Freshfields and Linklaters mull shake-up of lockstep models
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