Lawyers Weekly contacted Allens Arthur Robinson, Blake Dawson Waldron, Clayton Utz, Freehills, Mallesons Stephen Jaques and Minter Ellison, asking them how their salaries stacked up against the biggest United Kingdom firms. Not one of them was willing to provide the vaguest estimate of salary trends at differing levels of experience.

But there is little doubt that wages being paid to young lawyers in London leave Australian firms for dead.

In Australia salaries rose only 8 per cent nationally according to Mahlab Recruitment’s 2006 private practice survey. Yet the salary war amongst London firms has resulted in pay rises of around 20 per cent, which will no doubt lure more young Australian lawyers to the United Kingdom.

Freshfields Bruckhaus Deringer recently announced an average 19 per cent rise to base salaries across the firm, with the biggest rise for lawyers with three years post-qualification experience — whose £74,000 ($179,605) salaries jumped 21.6 per cent to £90,000 ($218,468).

Newly qualified lawyers have seen their pay jump from £55,000 ($133,475) to £65,000 ($157,743), and they will also be eligible for a discretionary bonus of up to £20,000 ($48,536) after six months.

Newly qualified lawyers at Allen & Overy will also earn £65,000 ($157,715), while those at Linklaters and Herbert Smith are now on £64,000 ($155,288) and their counterparts at Clifford Chance and Slaughter & May are on £63,500 ($154,160).

According to Mahlab’s 2006 survey of top tier firms in Australia, graduate lawyers received an average of $60,000. Those with one year’s experience got an average of $68,000, while two years got $84,000 and three years $96,000. But there was no information available on a firm by firm basis.

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Only two representatives of top tier firms were willing to comment about the salaries their staff members receive.

“We pay market competitive rates commensurate with our position in the market as one of the major law firms in Australia,” Kate Rimer, executive director of people & development at Mallesons, said.

“We review the salaries of our junior lawyers on three occasions during their first two years of practice. After that, reviews take place on a yearly basis. Our salary market data is obtained through comprehensive benchmarking of salaries against comparable firms in the markets in which we operate,” Rimer said.

“As a firm, we recognise we are operating in a global employment market with many lawyers choosing to spend a portion of their career overseas. To encourage lawyers to return to Mallesons after working overseas we have formalised a referral program with Clifford Chance and Linklaters in the UK. Since the introduction of these arrangements over 20 Mallesons lawyers have used the program.”

Mark Thomas, Minter Ellison’s director of people & development, said the market is extremely tight and competitive in Australia.

“As such we closely monitor the market to ensure that our remuneration is attractive to both attract and retain lawyers,” Thomas said.

“Our philosophy is to supplement a very competitive salary with a range of other non-cash benefits and career development experiences to ensure our complete offering to lawyers is amongst the best in the industry.”

According to John Chisholm, of John Chisholm Consulting, a former managing partner of Maddocks and partner at Middletons, the big firms in Australia refuse to discuss salary information not just because of privacy issues, but because of a desire to focus on other benefits employees are rewarded with, such as increased holiday time, memberships and competitive maternity and paternity leave conditions.

“We have privacy laws here, and some people, even employees, might not even be happy that their salary levels are made public in the market place,” Chisholm told Lawyers Weekly.

“The other thing is that I suspect that for many of the firms here in Australia it is not just a question of the salary per se … but also on the additional things. Most of the firms have worked generally very hard to not only meet the market in providing salary conditions, but also what I call “the add-on” — all the values to try and retain and attract really good employees and lawyers,” he said.

“But I think the greatest increase I’ve seen in most of the firms is a genuine desire … to improve that work—life balance, and to really give people interesting work. Most people will work as hard as you like as long as the work is really interesting and exciting. But once it loses that … people will start [wondering] ‘why am I working 12, 14 16 hours a day, when I can go to London, and sure I’ve got to work, but I’m going to get paid quite a lot more’.”

Chisholm said that Magic Circle firms in London are obliged under law society rules to do some limited financial reporting, including profitability figures, and are otherwise used to a more open culture.

“It’s more transparent out there, and has been for some time. And in Australia, we’re not in that situation, or at least not yet,” he said.

“We are more open now in Australia in terms of things like revenue, and even in some cases, profitability, with some firms, but there is still a reluctance to print salary levels. I think it’s just that old habits die hard.”

As firms, such as Slater & Gordon, increasingly look to public listing, Chisholm said firms will probably be forced under the corporations law to release some salary information, at least at the executive level.