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International Edition

Pure lockstep out of favour as economic woes prompt partner pay shake-up

Half of the UK's leading law firms have either changed their partner remuneration structure since the onset of the credit crunch or are currently reviewing it, according to Legal Week's latest Big Question survey, which highlights the increasing acceptance of merit-linked pay for partners. Forty percent of partners responding to the survey said their firm had changed its remuneration model for partners since the onset of the financial crisis, with a further 11% in the process of looking at it and an additional 1% saying they had plans to review it. About 41% had made no changes, while 6% said they had reviewed their partner reward system but decided against an overhaul. The findings show that only 10% of respondents work in firms with pure lockstep structures, compared with 27% in firms with pure merit systems and 23% in firms keeping aside part of their profits for rewarding top earners. The largest group – 40% – said their firms operate modified locksteps allowing partners to be moved up or down or held based on their individual performance.
5 minute read

International Edition

All aboard – Scotland makes debut in near-shoring market

As market speculation around the potential tie-up between SJ Berwin and King & Wood Mallesons went strangely quiet this week, attention instead refocused very much closer to home. Well, 400 miles away from London, but still distinctly closer than Asia. The reason? Ashurst's decision to build a low-cost back office and legal support centre in Glasgow, which puts the job security of some 350 support staff in London under threat but, at the same time, promises to bring roughly 150 new jobs to Scotland within the next 12 months. And, given the recent upheaval in the Scottish legal market, some might say this second point is no bad thing.
2 minute read

International Edition

Nabarro turnover climbs 2.6% as PEP looks set to leap 30%

Nabarro has seen turnover for the 2012-13 financial year climb by 2.6%, with the increase coming against a predicted 30% rise in profits per equity partner (PEP). The top 30 UK firm has announced an unaudited revenue figure of £116.3m compared with £113.4m the previous year. PEP has not been formally calculated but is expected to climb to £430,000, which would represent a jump of roughly 30% compared with last year's audited PEP figure of £332,000.
2 minute read

International Edition

Ashurst reviews 350 London roles in low cost Scots support base launch

Ashurst is set to launch a new low cost centre in Scotland, in a move which will see London business support roles placed at risk of redundancy. The new Glasgow base, which will open later this year, will house 150 support roles, including 30 legal analysts and 120 business support roles, with the firm set to recruit heavily in the Scottish market.
4 minute read

International Edition

Bidding for Byron burger chain serves up key roles for Freshfields and SJB

Freshfields Bruckhaus Deringer and SJ Berwin have tucked into roles on the bidding for burger chain Byron, which has seen the owner of YO! Sushi emerge as a potential acquirer. Byron's parent company Gondola Holdings, which is owned by private equity giant Cinven, has teamed up with DC Advisory Partners to sell the fast-growing burger business, which is reportedly valued at £100m. Freshfields is acting for longstanding client Cinven, led by corporate partner Adrian Maguire.
2 minute read

International Edition

Scrubbing up expert evidence – the pros and cons of 'hot tubbing'

Following Lord Justice Jackson's recommendations we have recently witnessed one of the most significant changes in relation to the use of expert evidence. An amendment to the practice direction to Civil Procedure Rule 35 (PD 35) means that a court now has the power to order expert witnesses to give their evidence concurrently, by means of a discussion chaired by the judge – a process colloquially known as 'hot tubbing', or, more formally, witness conferencing. What does this mean and what will be the impact on the appointment of an expert witness? Many may fear that this reform is just a case of 're-arranging the deckchairs' because, as Jackson himself stated, "it is doubtful whether either lawyers or litigants or experts will welcome yet another raft of rules about expert evidence". However, there are good grounds for expecting that hot tubbing will save both time and money following a review of the use of this method in Australia – where hot tubbing was developed and has proved successful – and a pilot scheme undertaken in the Manchester Technology and Construction Court and Mercantile Court.
8 minute read

International Edition

BLP real estate team to feel brunt of cuts as partners predict sharp PEP dip

Real estate is set to be heavily affected by Berwin Leighton Paisner's (BLP's) recently announced redundancy plans, with one third of the planned lawyer cuts set to hit the firm's property and planning teams. The UK top 15 firm last month put around 100 jobs at risk of redundancy, including 58 legal roles. It has now emerged that roughly 17 of the lawyer positions are in the real estate team, with a further three roles at risk in the planning department. It is understood that the firm may try to move some of the lawyers at risk of redundancy into its Lawyers On Demand service. Meanwhile, partners have said profits per equity partner (PEP) could be down by as much as 50% this year, against broadly static revenues. This could take PEP down to around £330,000, compared with a figure of £660,000 in 2011-12, when profits fell by 7%.
3 minute read

International Edition

Mining your claim – turning litigation into a useful business tool

In today's difficult economic climate, businesses are having to work harder than ever before not just to prosper, but to survive. This means that they are increasingly looking for innovative ways to bolster their bottom line – seeking out opportunities in territories that might have remained unchartered in more buoyant times. One way that companies can do this is by seizing the opportunity presented by litigation when a set of facts presents itself and appears to justify the pursuit of a claim. It can be a particularly useful business tool for those rich in claims as, once a company with a regular stream of cases has become proficient in the funding, practice and business of litigation, it can commercialise it. In this way one man's liability becomes another man's asset, with disputes viewed as a potential cost generator rather than purely an expense.
7 minute read

International Edition

Off track – why associates face a long wait to break into the top ranks of UK law firms

Junior lawyers may not be under any illusions about the challenges facing them on the track to partnership – but the size and scale of that challenge has been starkly illustrated by new Legal Week research that plainly sets out the increasing length of time UK associates are now required to put in before making partner. Analysis of this year's partnership data shows the average post-qualification experience (PQE) held by newly qualified UK partners at top 10 firms this year stands at 10.6 years – an increase of almost 30% on the equivalent figure of 8.2 in 2006. And the standard set by the country's largest firms has been broadly replicated by their smaller contemporaries, with the average partner track across the top 50 now standing at 10.5 years. One senior partner at a top 10 law firm commented: "It is undoubtedly taking people longer to make partner and I suspect it is the case at all firms. We need to keep promoting the best people to partnership, but law firms are changing after years of double-digit growth – fewer people are now getting through."
5 minute read

International Edition

Minster Law plans further expansion after landmark takeover by insurance business BGL

Claims firm Minster Law is targeting significant growth and expansion into new areas of law following its acquisition by insurance business BGL Group – a deal that marks the largest outright takeover of a UK law firm to date. BGL – the owners of well-known insurance brands including comparethemarket.com – acquired the law firm, which last year posted revenues of £107m, for an undisclosed sum, after Minster received Solicitors Regulation Authority approval to convert to an alternative business structure (ABS). Minster is unusual among large law firms in that it works under a corporate structure, with its 840 staff in York and Wakefield comprising around 170 fee earners and just 54 qualified lawyers. It has a particular focus on road traffic accident work, as well as employment, probate, wills and conveyancing. BGL, meanwhile, has 4.6 million customers and employs more than 2,400 staff across a portfolio of brands.
4 minute read

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