Linklaters is latest law firm to nix 'lockstep' pay model in hot hiring market - Reuters
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(Reuters) - Law firm Linklaters on Thursday said it is changing how it pays partners, becoming the latest major firm to move away from a strictly seniority-based "lockstep" compensation system.
By abandoning pure lockstep pay in favor of a modified version, the London-founded firm said its top contributors will be eligible to be paid more, and it can begin to move high-performing partners up the pay ladder faster. The firm will also allow its lawyers to make partner earlier.
The changes, announced internally on Wednesday after a partnership vote, will help Linklaters grow its ranks, Paul Lewis, Linklaters' firmwide managing partner, said in a statement. A firm spokesperson said Linklaters has around 2,400 lawyers globally, including around 480 partners.
The firm has about 150 lawyers in New York and Washington, D.C., a spokesperson said. Linklaters and other leading U.K. firms have been competing for greater U.S. market share while also trying to ward off poaching by U.S. firms in London.
Demand for top partners and associates, particularly in corporate practices, has been particularly high in recent months thanks to an historic M&A boom.
"This vote underscores Linklaters’ commitment to attracting and retaining the best talent in the world and gives us additional flexibility to drive forward our ambitious strategic growth plans," Lewis said.
Linklaters' move comes less than two weeks after Cravath, Swaine & Moore, a longtime U.S. adherent to the lockstep model, also said it was adopting a more flexible compensation model.
Competitors of both firms have gradually abandoned the pure lockstep system in order to retain and attract high-performing partners, who can often fetch several million dollars per year.
After U.K.-founded Freshfields Bruckhaus Deringer lured prolific dealmaker Ethan Klingsberg away from Cleary Gottlieb Steen & Hamilton in 2019, a recruiter's lawsuit estimated the firm had offered Klingsberg $10 million in annual compensation. Freshfields has previously declined to comment on Klingsberg's compensation and called the figure inaccurate.
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source: https://www.reuters.com/legal/transactional/linklaters-is-latest-law-firm-nix-lockstep-pay-model-hot-hiring-market-2021-12-16/
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