BigLaw firm cuts partner draws by 20%, asks staff to move to 80% work and pay

BigLaw firm cuts partner draws by 20%, asks staff to move to 80% work and pay

16 April 2020 By Jerome Doraisamy

An international law firm is reducing partner drawings and has asked employees to adopt an 80 per cent work pattern and equivalent remuneration reduction, among other new measures to combat COVID-19.

Ashurst has unveiled new measures which it says will “ensure the firm’s financial resilience during and beyond” the global coronavirus pandemic.

The measures form part of the firm’s new “Stronger Together program, which it says is focused on ensuring the Ashurst community works together “to ensure job security is protected, the health and wellbeing of our people [are] supported, and the culture of the firm is preserved”.

The health crisis we are seeing in the countries where we operate is unprecedented. We’re all trying to do the best we can to navigate the very different world we now find ourselves in, said Ashurst global managing partner Paul Jenkins.

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As a global business, Ashurst like many others is affected by the economic disruption being caused by COVID-19. We start from a solid financial position and so far across the firm, our activity is holding up well in the circumstances. We are looking ahead in a responsible way however, and must anticipate that given the global economic slowdown we may see less activity in the markets in which we operate.

“As such, we are managing our business prudently in case the impact is protracted. We believe the measures we are putting in place are in the best interests of the whole firm and will assist in ensuring we maintain outstanding service to clients and our strong performance of recent years.

The measures being implemented by the firm include: reduction in monthly sums paid to partners by 20 per cent for the next six months, salary reviews for the coming 2020-21 financial year will be deferred until November 2020, and bonuses for eligible staff will be staggered, with 50 per cent to be paid in July of this year and the remaining 50 per cent paid in November.

Additionally, employees have been asked to adopt an 80 per cent work pattern for three months from May 2020 with an equivalent reduction in remuneration. Staff will, however, retain all full entitlements such as leave, superannuation and pension contributions.

This final measure will not apply to staff “in the busiest areas” as well as firm members who are paid at levels below a determined threshold. It will also be subject to the respective regulations in which the firm operates.

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Ashurst also expects that partner incomes for the coming financial year “to be significantly reduced”.

The decisions we have made are difficult and we do not underestimate the impact they will have on our people. They are necessary to protect jobs and avoid the redundancy situations that other professional services firms have needed to consider, said Mr Jenkins.

The 80 per cent work pattern will help manage capacity levels of the business in [the] coming months. It will impact teams at different times depending on the demand from clients. The firm is fully operational and while working virtually in most locations, we are able to allocate resources according to client need.”

Ashurst chairman Ben Tidswell expressed pride in the Ashurst community, as well as the manner in which the firm’s partners and leadership team have banded together with all staff through this difficult time.

As a firm we have pulled together in an impressive way, with outstanding leadership shown by many of our people, including in particular our partners. While this is not an easy time, I take a great deal of confidence from the way the whole firm is presenting a united front, as we continue to meet the needs of our clients,” he said.

We all have an important role to play as business partners and members of our broader community. I have said regularly to the firm as the COVID-19 impact has unfolded that ‘we are all in this together’ and I have no doubt that Ashurst will emerge strongly from these challenging times, concluded Mr Jenkins.

The Ashurst workforce continues to operate virtually, with teams across the globe fully operational and continuing to serve the needs of our clients.

The new measures mark a change in the firm’s position from mid-March, at which time the firm’s chief people officer, Andrea Bell, told Lawyers Weekly that Ashurst’s approach for each of its offices around the globe was being guided by local government recommendations.

We are trading as usual throughout the region and are adapting to the conditions to reduce the effect of the disruption to our clients, as well as supporting the health and safety of our teams,” Ms Bell said at the time.

Our global network and technology [enable] us to offer the same service whether working remotely or from the office and we have encouraged flexible working arrangements where necessary.”

BigLaw firm cuts partner draws by 20%, asks staff to move to 80% work and pay
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