King & Wood Mallesons (KWM) is asking its salaried partners to contribute capital for the first time, following a review of the firm's finances that will also see equity partners paying in more cash.

Former partners told Legal Week that salaried partners had been asked to contribute around £60,000 each. It is not clear what, if anything, these partners will receive in return for their money.

Salaried partners at KWM have historically been eligible to receive a discretionary share of the firm's profits based on their own performance but, to date, have not had any of their salary directly linked with overall performance.

In April 2014, HMRC brought in to effect rules under which non-equity partners have to contribute at least 25% of their fixed share salary in capital to be classed as partners rather than staff, allowing firms to avoid paying national insurance contributions.

Several firms opted to change their partnership structure in response to this new rule, but it is understood that KWM did not.

The decision, communicated to partners last week, is part of a broader move to boost the firm's capital resources, with existing equity partners also asked to put in more cash.

Equity partners have been asked to contribute an extra £4000 per point. KWM currently operates a 20-60 remuneration point ladder, meaning the firm is set to collect between £80,000 and £240,000 in extra capital.

One ex-partner said: "My concern would be putting money into a business when I didn't know if I was ever going to get it back… If partners are getting some equity return they might be fine with it, but if they're not they won't be very happy about it. I would consider it to compound general issues at the firm if that's the case."

Another said: "When it was first discussed, it was talked about in terms of it being exciting for these people to pay money in because they'd feel more of a part of the business."

Legal Week reported in January that KWM had launched a review of partners' capital contributions as part of a global strategy review aimed at improving integration within the firm.

Capital contributions at the firm have been notoriously low, with the firm at times blaming the lack of available capital for repeated delays to its partner profit distributions.

In an interview in February, Stuart Fuller said that the current capital contribution paid in by partners was "around 50% lower than some other firms".

Also in February, the firm overhauled its profit distribution system by moving to a monthly distribution schedule following repeated delays in the then quarterly payments.

Before the February profit payment, KWM had made just 25% of the payments due within the 2015-16 financial year.

Europe and Middle East senior partner Stephen Kon acknowledged that the delays were "not good" for the firm.

He said: "At the end of the day, we're a business that requires cash to distribute to our partners. To some extent we're in our clients' hands when it comes to distributing cash.

One ex-partner said: "Recapitalisation had always been on the cards but in circumstances where they're slow to pay profits, recapitalisation is a pain."

KWM has also recently extended its overdraft facility with Barclays from £20m to £25m.

In March, the firm announced sweeping reforms to its European and Middle East arms, which were expected to result in up to 24 partners departing the legacy SJ Berwin businesses.

Some partners have also left of their own accord.

This month, Covington & Burling hired two litigation partners from the firm. Greg Lascelles and Elaine Whiteford's moves will see the duo reunited with KWM's former litigation head Alex Leitch.

Other recent exits include the firm's former European finance chief Jeremy Cross, who joined Cadwalader Wickersham & Taft on Monday (11 July), while fellow KWM finance partner Robert Andrews is set to join Ashurst in London later this year.

KWM declined to comment.