Law Firm Partner Moves in London - Issue 81

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Welcome to the 81^st edition of Law Firm Partner Moves in London, from the specialist partner team at Edwards Gibson, where we look back at announced partner-level recruitment activity in London over the past two months and give you a ‘who’s moved where’ update.

 

• A summary of the first half of 2024

 

This edition marks the midpoint of 2024 and, in addition to our usual bi-monthly report, we have included some facts and figures below comparing the partner-level recruitment activity in the first half of 2024 with that over the same period of the past five years.

The first half of 2024 saw the continuation of last year’s record year for partner hires. There were a total of 265 announced partner moves, up on the 257 we saw last year, and 7% higher than the five-year average for the same period - (248).

 

 

The most prolific hirer in the first half of 2024 was Simmons & Simmons which welcomed 12 partners (9 of whom were laterals) succeeded by Kirkland & Ellis (11 partners; 4 of whom were laterals) and Pinsent Masons (9 partners; 6 of whom were laterals).

 

• Top partner recruiters in London 2024 (inclusive of hires from non-partnership)*

 

Simmons & Simmons	12	(9 laterals)
Kirkland & Ellis	11	(4 laterals)
Pinsent Masons	9	(6 laterals)
Charles Russell Speechlys	8	(6 laterals)
King & Spalding	7	(6 laterals)
McDermott Will & Emery	7	(6 laterals)
Paul Weiss	7	(5 laterals)
DLA Piper	6	(5 laterals)
White & Case	6	(4 laterals)
Paul Hastings	5	(3 laterals)
Perkins Coie	5	(3 laterals)
RPC	5	(3 laterals)

* To 30 June 2024

On the other side of the coin, over the same period, Deloitte Legal, Linklaters and Paul Hastings suffered the highest attrition, losing 7 lateral partners apiece in London.

 

• Firms with largest attrition in London 2024 (partnership to partnership moves only)*

 

Deloitte Legal	7
Linklaters	7
Paul Hastings	7
Cadwalader	5
EY Law	5
Goodwin Procter	5

 * To 30 June 2024

 

• Other Fun Facts from the first half of 2024

 

• 37% of all moves so far in 2024 were female (97).
• 4% of all moves (11) were in-house lawyers moving into law firm partnerships.
• 25% of all moves (67) were vertical hires (non-partners elevated to partnership upon moving from another law firm).

 

• May – June 2024

 

This bi-monthly round-up contains 80 partner moves – 8% up on the 74 we saw for the same period in 2023 and 3% up on the cumulative five-year and ten-year averages for the same period – which both sit at 77.

 

 

 

 

• Top partner recruiters in London May – June 2024

 

Simmons & Simmons	7	(6 laterals)
King & Spalding	5	(4 laterals)
Perkins Coie	5	(3 laterals)**
Latham & Watkins	4	(4 laterals)
McDermott Will & Emery	4	(3 laterals)

** Includes a former partner returning to private practice after a 3-year absence

In addition, eleven firms, hired two partners each: Addleshaw Goddard, Browne Jacobson, Clifford Chance, Covington & Burling, Greenberg Traurig, Hogan Lovells, Kirkland & Ellis, Paul Weiss, RPC, Squire Patton Boggs, and Stephenson Harwood.

 

• Firms with largest attrition in May – June 2024 (partnership to partnership moves only)

 

Cadwalader	5
Cahill Gordon & Reindel	3
Deloitte Legal	3
EY Law	3
Morrison & Foerster	3***

*** Excludes a lateral departure from the Brussels office joining another firm in London

In addition, six firms lost two partners each: A&O Shearman, Eversheds Sutherland, Gateley, Osborne Clarke, Sidley Austin, and Travers Smith.

 

 

• Team hires May – June 2024

 

The most sizable multi-partner team move this edition was Atlanta headquartered King & Spalding’s hire of a five-partner funds finance team from Cadwalader. In addition, two firms hired three partner teams: Latham & Watkins (finance from Cahill Gordon & Reindel) and Simmons & Simmons (TMT from Deloitte Legal)

Lastly, five firms hired two partner teams: Browne Jacobson (technology and commercial from EY Law); Covington & Burling (private equity real estate from Sidley Austin); McDermott Will & Emery (real estate from Fried Frank and finance from Morrison & Foerster); Perkins Coie (corporate from White & Case in Prague) and Simmons & Simmons (private equity and acquisition finance from Osborne Clarke).

 

• Top 50 US firm launches in London

 

Technology flavoured Seattle outfit - Perkins Coie - launched its London office in May with an eclectic quintet of corporate partners comprising: storied rainmaker Ian Bagshaw (who returns to private practice three years after retiring from White & Case, where he was global co-head of private equity); two in-house General Counsel; and two laterals from White & Case in Prague.

 

• Freshfields starts a salary war … more Sun Tzu than Milton Friedman

 

In May, Freshfields Bruckhaus Deringer dramatically hiked the base compensation for its newly qualified lawyers (NQs) in London by 20%; from £125,000 to £150,000. The move by the Magic Circle firm was surprising because, whilst the partner market has so far remained reasonably robust through 2024 (primarily on account of law firms hoping to grow by “buying” books of business from rainmaker laterals), overall, the market for legal services has been soft – certainly relative to the post-covid bounce. Indeed, having ramped up associate leverage for a short-lived economic boom, many law firms have found themselves overstaffed, particularly at the very junior NQ level.   

From a purely economic (supply and demand) perspective a law firm salary war is puzzling... Indeed, this is the first time in history that such dramatic hikes have occurred in the absence of a wider economic boom. 

 

Perhaps unsurprisingly, Freshfields’ move has been followed by all bar one of the Magic Circle quintet, leaving just Slaughter and May as a hold out. The move, which narrows the differential for NQ (First Year) English qualified associates to, by far, the closest that it has ever been in proportion to full New York Rates, has inevitably put pressure on other firms. Indeed, some mid-Atlantic Rate paying US firms, have reacted with their own dramatic hikes and, if history is any guide, UK law firms further down the pecking order will eventually be impacted by the gravitational pull - at least in relation to elevating the totemic NQ rate - which for law students and associates alike, is often a proxy for the objective quality of a given firm.

From a purely economic (supply and demand) perspective a law firm salary war is puzzling. The UK associate hire market is relatively weak, with virtually zero demand from law firms for external NQs and, unlike the US, whose economy has remained relatively strong throughout, the end of 2023 saw a technical recession in the UK. Indeed, this is the first time in history that such dramatic hikes have occurred in the absence of a wider economic boom. 

As we argue in Breaking The Circle - the real significance of Freshfields pay bonanza is far more profound than just another Big Law salary arms race, it is probable that Freshfields’ latest salary offensive in such a tepid market was a very deliberate statement to help distance itself from its Magic Circle peers.  For some time Freshfields has been actively eschewing the term “Magic Circle”, seeing it as too British and inconsistent with its designs to be a major player in the US, preferring instead the moniker “global elite”.  No matter that its erstwhile peers have followed suit; by upping the ante so dramatically, Freshfields has once again set the UK Big Law agenda. Moreover, aside from non-globalist Slaughter and May, Freshfields is in better financial shape than the rest of the Magic Circle coterie so, by forcing its rivals to add so much additional fixed costs to their balance sheets, it can always hope that one of them may just blow a gasket!

Whilst Freshfields’ recent associate pay hikes are unlikely to be welcomed by its UK rivals, in practice, the costs of following suit will not be as significant as it may at first seem. This is because, since the breakdown of strict associate lockstep (where a given lawyer’s base compensation increased by a defined amount each year in accordance with their level of post qualified experience (PQE)) more than a decade ago, compensation hikes at UK law firms have been overwhelmingly focused on the totemic NQ level with often only minimal hikes for more senior associates.  

Whilst Freshfields’ recent associate pay hikes are unlikely to be welcomed by its UK rivals, in practice, the costs of following suit will not be as significant as it may at first seem.

For those Mid-Atlantic Rate paying US firms looking to maintain a 20% differential on the new Freshfields rates by, adopting Full New York Rates (the Cravath Scale) in London, things will be a lot more expensive because, due to the continuation of defined associate lockstep on the Cravath Scale, compensation hikes will need to be more uniform across all PQE levels.   

 

• Paul Weiss – Blackjack!

 

With two more London partner hires announced in the past two months, by our reckoning, Paul Weiss – the City’s Big Law equivalent of an exploding super nova – has hired no fewer than 21 partners to its Air Street office since its fiery European re-birth in August last year (this excludes a couple of partners who will be splitting their time between London and elsewhere, and two internal promotions in June).
 
The impact of the covetous New Yorker on the highest levels of the London legal services market over such a short period has been profound; certainly, greater than any previous law firm launch or re-launch this city has ever seen. Whether it be: re-calibrating expectations with (reportedly) $20 million headline compensation for its favoured laterals; the huge knock-on effect down the chain as hapless rivals have scrambled to re-stock anchor rainmakers; or (ultimately the most important metric of all) instructions on significant European mandates - Paul Weiss has proved the adage “there is always room at the top!”

It is probable that the only reason the New York firm has even been able to make vertical hires, not to mention rapid internal partner promotions, is because of the recent abandonment of its, once sacrosanct, all-equity partnership structure.

Significantly, the Wall Street firm’s two most recent hires – a Counsel from Linklaters and a Senior Associate from Clifford Chance – are its first ever “vertical” (non-partner into partnership) recruits as opposed to “lateral” (partner-to-partner) hires in London. Whilst vertical hires are not exactly cheating – indeed, some of the most successful rainmakers in the City originally got their big break as vertical hires - the carrot of “day-one partnership” sure makes luring top (non-partner) talent a whole lot easier. It’s a template snatched from the playbook of arch-rival Kirkland & Ellis and used to phenomenal success in that firm’s more than decade-long rapid expansion.

It is probable that the only reason the New York firm has even been able to make vertical hires, not to mention rapid internal partner promotions, is because of the recent abandonment of its, once sacrosanct, all-equity partnership structure. Whilst all-equity partnerships convey many advantages to elite law firms, they are structurally inflexible and, due to the high bar to entry, make rapid partner expansion exponentially more problematic (not to mention eye wateringly expensive!)

So having already elbowed its way into a prime seat at London’s Big Law top table by removing all house limits, it seems the New York Patrician can keep playing into the small hours by either doubling down for the odd lateral “whale” or, with its new-found ability to make smaller (less risky) bets, patiently accumulate chips bit-by-bit at the expense of its rivals for whom the Blackjack term “HIT ME!” may have whole different connotations.

 

• Other Fun Facts May – June 2024

 

• 31% of moves this edition were female (25)
• 3 firms hired from in-house: Clifford Chance (from Competition and Markets Authority), Perkins Coie (from Phrase and Bud Financial Group) and Travers Smith (from Blackstone Credit).
• 25% of all moves (20) were vertical hires (non-partners elevated to partnership upon moving from another law firm).

 

Please do not hesitate to contact us if you would like to discuss this article or any other aspect of the market in more depth.

Scott Gibson, Director scott.gibson@edwardsgibson.com or +44 (0)7788 454 080

Sloane Poulton, Director sloane.poulton@edwardsgibson.com or +44 (0)7967 603 402

 

Please click here to understand our methodology for compiling Partner Moves

 

 

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• Edwards Gibson Partner Round-Up - Our Methodology
• Previous editions of Partner Moves in London
• Quantifying your following and writing an effective law firm business plan
• Specimen partner business plan template
• The Partnership Track and Moving for Immediate Partnership
• Legal directory rankings and their effect on lawyer recruitment
• Restrictive Covenants and Moving on as a Partner