Slaughter and May has become the first magic circle firm to announce associate salary rates for 2013, confirming small increases in pay for junior lawyers across the board.

The increases, which will take effect from 1 May, will see the firm raise rates for newly-qualified lawyers by 2.4% to £63,000, with lawyers with between one year and three years' post qualification experience gaining increases of between 0.7% and 2%. Trainee salaries will also rise and, in addition, lawyers will progress through the pay bands as normal.

Richard Clark, who will become executive partner of Slaughter and May on 1 May following Graham White's retirement, commented:

"Our salary review has concluded that with effect from 1 May 2013, our associates will move to the next step in the salary scales and there will be some increases in the scales for our associates and trainees. Our view remains that the economic climate is still uncertain but we are cautiously optimistic for the rest of 2013."

Confirmation of the pay bands for junior lawyers comes after Slaughters announced earlier this year that it was overhauling its associate appraisal system and ushering in merit-based pay for more senior lawyers.

The overhaul means that from 4.5 years' PQE to partner lawyers will be categorised as either 'good' (where the majority will sit) or 'exceptional', with those graded as exceptional receiving a higher salary. The firm has yet to confirm how much more exceptional lawyers will receive compared with their peers.

Whether an associate is classed as 'good' or 'exceptional' will depend on their overall score in a new system grading them across four areas: legal knowledge and skills; business and communication skills; practice management skills; and people skills and personal development.

While Slaughters is the first to announce its associate salaries, Allen & Overy (A&O) confirmed earlier this month that it was raising trainee pay levels – ending a three-year freeze in rates.

First-year trainees at the magic circle firm will receive £39,000, up £1,000 from £38,000, while second-year trainees will now take home £44,000, a rise of £800 from £43,200.

Slaughters' increases mean the firm's 2013 rates for junior lawyers are as follows (2012 in brackets):

Newly qualified: £63,000 (£61,500)
One year PQE: £69,500 (£69,000)
Two year PQE: £78,000 (£76,500)
Three year PQE: £87,500 (£86,000)

Trainee year 1: £39,000 (£38,000)
Trainee year 2: £44,000 (£43,000)