U.K. firm Hill Dickinson is the latest global law firm to cut staff pay as part of the measures to weather the impact of the COVID-19 pandemic.

The firm is reducing the salaries of all employees earning above £30,000 a year—or the local equivalent—by 20% for May and June; and has suspended this year's pay review until "economic circumstances allow." The cuts apply to all employees globally.

Firm CEO Peter Jackson announced the cost-cutting measures in an internal email sent out to staff on April 21. Attributing the measures to the anticipated drop-off in transactional work, Jackson wrote that the firm will not implement any layoffs in May or June following the salary reduction, although he did not rule out furloughing more staff.

Partner compensation is also reduced following pessimistic projections for the coming months. Full-share partners are set to suffer at least a 20% loss of earnings in financial year 2020-21, which started on May 1, and "[t]he sums involved could be far greater," according to Jackson.

The firm has suspended all further payments of the profit owing to partners for financial year 2019-20. The sums involved equate to 27.5% of the full partners' rewards from the business. The suspension will continue for an unknown period moving forward, Jackson wrote.

Jackson said the pay reduction measures are painful but necessary steps to protect jobs, which remains the firm's primary objective over the next few months. "To achieve our objective it will be necessary for us all to make sacrifices and accept that the financial consequences of this crisis will affect us all," he wrote. "If we do not all contribute to the measures proposed below, we will immediately need to take more drastic measures and we do not wish to do that."

The measures received "98% consent across the firm" following discussions between the firm's staff and leadership, according to a second internal email Jackson sent to staff on April 27. The 2% of staff that did not consent will also see their salaries reduced. Jackson said that the firm's leadership will review the situation at the end of June and return to full pay "if matters improve."

An employee of the firm said that most staff were sympathetic to the challenges faced by the firm's leadership. However, there are concerns about the uniformity of the pay cut, which applies to all staff irrespective of whether they are working fewer hours due to COVID-19. One of the seven items outlined in Jackson's email to staff was an instruction to lawyers to "continue to work at full capacity when required."

Hill Dickinson refused to comment on the report.

The firm, headquartered in Liverpool in the U.K., has eight offices around the world, including Monaco, Singapore and Hong Kong. On Sunday, the U.K. government announced the first measures to ease the nationwide lockdown.

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