It is, according to CMS’s managing partner Stephen Millar.
In an interview with U.K. reporter Jack Womack, Millar said that its was entirely “justified” that lawyers at big law firms earned top whack as it “spoke to the quality of the service on offer”.
Bold words that can be taken one of two ways, depending on your vantage. If you’re a lawyer, and you’re at a big firm, it’s the kind of rhetoric that’s been missing from the largely unfavorable discourse on pay thus far. If you’re outside of the legal sector, “it’s going to be difficult to stomach, particularly nowadays,” a person who works in pensions told me.
Energy companies are taking the heat so far, paying out record profits to their shareholders as much of the rest of the world feels the pinch of soaring prices.
But could there be a day when law firms too face this sort of public indignation?
Peopled with highly qualified individuals, law firms offer solid services—but, as a general counsel commented on a revenue story we posted to LinkedIn last week, prioritising profits can mean that “the client desire for good and efficient service can easily become hard to keep in mind”.
Indeed, perhaps the legal media has a role to play in all this. But law firm with salaries rising and rising—Jones Day upped its U.K. NQ pay this week to £140,000, a relatively modest sum in today’s climate—it feels like a reckoning of some shape is on the way. People are asking urgent questions of the hazardously high rate of inflation right now—and similar kinds of questions are being asked of law firms too. Expect more scrutiny of billing, of the type of work done and charged for, of how and why it is that a 24 year-old novice can enter a job that pays more than most senior positions in the working world outside of the law.
Millar is nonetheless unequivocal in his support of six (and seven) figure pay packets: “We should all feel privileged to work in a high pay sector, and it’s something that the sector should celebrate more than it does. High pay is justified.”
But there are other factors at play that can influence law firm expenditure beyond possible impending social and client pressures. Andrew Maloney wrote about how exchange rates could affect how U.S. law firms manage certain expenses, set billing rates and attract laterals. Check out his story here.
Add to this the dire state of global politics right now which can be spun as both the cause and result of shocking inflation that is edging economies ever nearer to recession. In Europe, Anne Bagamery wrote about how the downfall of Italy’s Prime Minister Mario Draghi’s government has unsettled business and financial communities, with lawyers suggesting the industry will inevitably feel the shockwaves.
But it’s not all bad news. As one partner told Anne: “This may be a difficult moment from the political point of view, but it’s good from the industry point of view,” he said. “It’s a trade-off.”
Habiba Cullen-Jafar‘s research into which of the potential candidates for the U.K. premiership—Liz Truss and Rishi Sunak—lawyers favour most (or least), was eye-opening for two reasons: a) their broad support for slick, pragmatic Sunak and b) it showed us how wonderfully opinionated lawyers can get over politics.
Commenting off-record, one partner compared the choice as “being asked whether you would prefer still or sparkling water when you’re about to be waterboarded”, while another said Truss was “unfit to be a kindergarten teacher”. Expect other equally wild comments in Habiba’s story here.
As a final word, a piece that I recommend you read is Gail J. Cohen‘s analysis of law firm efforts to combat stress and anxiety. Take a look at her excellent article, with what has to be my favourite headline of the week: Destroying the Myth of the ‘Gladiator’ Lawyer.