Another gloomy start to the year as more major UK law firms set to cut back staff. Gerard Starkey reports

With three major law firms announcing sizeable job cuts before the end of January, 2013 already looks near certain to be marked by a fresh run of legal redundancies as the UK economy flirts with a triple-dip recession.

As Legal Week went to press, Clyde & Co and Olswang had also indicated that they may make a small number of redundancies, potentially adding to the roll call of major law firms making cuts in the past three months. 

Job cuts at Clydes are expected to affect fewer than 10 support staff, while Olswang is currently consulting with six staff following some 'structural changes' to the firm's finance and employment teams.

An Olswang spokesperson said: "We are consulting with six members of staff who may be affected by these changes about their future roles. We hope to be able to avoid the need to make any dismissals by exploring alternative roles during the consultation period."

A number of top 30 UK rivals have already taken far more drastic measures, with Eversheds last week deciding to restructure its commercial and real estate practices and close its 29-strong Copenhagen office, placing a total of 166 jobs, including 82 fee earners, at risk.

The news of Eversheds' cuts arrived on the same day DLA Piper confirmed it was to close its Glasgow office at a cost of 45 jobs following a redundancy round launched at the end of last November. 

In addition, the firm continues to consult with 116 staff following the decision to centralise its document production team in Leeds. Allen & Overy also last week announced it is set to make 43 support staff redundant in a move that will see the firm relocate international roles from offices such as New York, Milan and Paris, to its lower-cost Belfast support hub.

One senior partner of a UK firm commented: "People have finally caught up with the fact that the UK market is struggling – some were guilty of being too optimistic and perhaps didn't go far enough during earlier redundancy rounds."

Eversheds HR director Angus MacGregor (pictured) commented: "We have done what we needed to do for now and I would hope for the short term future at least. Some of the areas that have been most badly affected are those where market activity has slumped. The reality is that the legal market has changed forever and all law firms are having to look in detail at their business models and make difficult decisions to secure a successful future. 

"Around 20 law firms have reported redundancies in the last 12 months and Eversheds, regrettably, is not immune from that."

Nearly a third of the UK top 30 have moved to shed staff in recent months, including CMS Cameron McKenna, Addleshaw Goddard and Pinsent Masons. Even Slaughter and May – one of the few major firms to avoid job cuts during 2009 – announced last November that it was cutting 44 secretarial staff.

Legal Week contacted the remaining firms in the UK top 30 to find out whether they had any plans to cut staff numbers. None of the firms questioned said any reduction in numbers was imminent. However, some did stipulate they would continue to monitor their position while others said the situation could change. Herbert Smith Freehills, Irwin Mitchell and Bird & Bird declined to comment. 

A managing partner at a top 30 firm commented: "It's hardly surprising considering we are about to enter what some people are calling a triple-dip recession. This, coupled with the fact that we are over-lawyered, means job losses are inevitable."

Despite the gloom, there is so far little expectation that 2013 is set for a repeat of 2009, when most major law firms announced sizeable redundancy rounds. Even through the sustained weaknesses in Western economies, during 2011-12 the UK top 50 saw revenues rise by 5.6% to £12.96bn.

A partner at a legal recruitment firm said: "Some of the recent job losses smell of a performance management exercise rather than a downturn. I don't get a sense of work flows dropping off dramatically, rather a selective picking off of individuals." 

Additional reporting by Pui-Guan Man and Alex Newman.