Allen & Overy cuts staff bill by £15m through shipping support jobs to Belfast and cutting headcount
Staff bonuses rise at the magic circle firm but total people bill falls from £438.6m to £423.7m
January 07, 2015 at 10:44 AM
3 minute read
Allen & Overy cut total staff costs by £15m on the back on moving support roles to its Belfast near-shoring centre and trimming overall headcount by 4.1%, the firm's limited liability partnership (LLP) accounts for 2013-14 show.
Despite staff bonuses across the firm rising by nearly 10% from the previous year to £31m, the firm's overall staff bill fell from £438.6m to £423.7m.
The firm said in the accounts that the cost reduction reflected "the impact of transitioning support roles to Belfast, a 4.1% decline in overall staff headcount and the impact of the 1 May 2013 pay awards" when it held associate salaries.
Total staff numbers reduced from 4,628 to 4,439 year-on-year, with lawyer numbers reducing from 2,296 to 2,181 and support staff numbers from 2,332 to 2,258.
The average number of partners at the firm ticked up one to 526, and turnover grew 1.6% to £1.21bn, resulting in an increase in pre-tax profit from £497m to £532m.
Average profit per full equity partner rose to £1.12m, up 6.7%, while capital contributions from partners edged down from £149m last year to £146m this year.
The firm's remuneration structure, which is reviewed every 1 May and runs from 20 to 50 profit sharing points, resulted in an equity ladder last year ranging from £627,000 to £1,57m for the highest paid partner.
Though no breakdown was provided in the accounts, according to the firm's annual report, its banking and litigation business grew strongly, but the "volatile market" provided a challenge to its corporate and capital markets businesses.
In total, the accounts show net assets amounting to £378m, up from £346m for the 2013 financial year.
The LLP filing also cuts into the amount of overdue client fees the firm . In 2013, £41.4m worth of bills were more than 120 days overdue, which was reduced to £35.7m in 2014.There were also reductions in payments overdue by 31-120 days (down from £69.3m to £62.6m) and those overdue by less than 30 days (falling from £78.7m to £75.7m).
After A&O launched its business and legal support centre in Belfast in 2011 the firm made around 18% of its London support team (180 people) redundant as it transferred roles across.
The Belfast centre now employs around 390 staff, with an extra 100 set to be recruited over the next five years.
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