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More pay for 5 days in-office? Not in Australia’s in-house market

Of all the incentives a business may offer to lure corporate lawyers, higher remuneration for full-time office attendance isn’t one of them, recruiters say – despite what reportedly is happening overseas.

user iconJerome Doraisamy 18 June 2024 Corporate Counsel
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Recently, UK-based legal publication The Lawyer reported that higher salaries are being offered to British in-house lawyers who attend the office five days per week.

According to the publication, businesses are offering such salary premiums for five days in-office attendance, as recruiters are finding it is harder to fill positions in the face of stringent work requirements.

Following this, Lawyers Weekly reached out to numerous in-house legal recruiters to see if the same reported trend is occurring in the Australian market.

 
 

Flexibility remains the key driver Down Under

According to four recruiters, many, if not most, Australian businesses are employing a 3:2 approach for their in-house lawyers – that is, three days working in-office and two days working from home – and there has not been a noticeable movement towards increased remuneration in exchange for in-office work.

This 3:2 model, Carlyle Kingswood Global director (legal and governance, in-house) Phillip Hunter outlined, “strikes a balance that appears to satisfy both employers and employees, ensuring productivity while accommodating the desire for flexibility”.

“Lawyers on the junior end are encouraged to come into the office so they can continue with their training development. However, the more senior lawyers are generally working on either two-day or three-[day] arrangement. Regardless, this has had no impact [on] remuneration,” u&u. Recruitment Partners senior associate (legal) Betsy Bargh said in support.

Expectations have “shifted dramatically” since the age of COVID-19, G2 Legal Australian director Daniel Stirling said, as most employers and employees have seen that people can work just as effectively at home as in the office.

“Law departments looking to hire lawyers to work five days in the office now have a much greater challenge than they did previously,” he said.

“At this stage, I haven’t seen these departments offering a salary premium to alleviate this issue, though if this challenge continues, they may need to consider it.”

Dovetail managing director Andrew Murdoch said he hasn’t had a client ask for a lawyer to work in the office five days per week for over a year.

“I don’t feel like there’s a struggle to have lawyers work more days from the office because there’s an acceptance that they can be just as productive working from home,” he said.

“If a company sought to recruit an in-house lawyer to work five days in the office, it would have few applicants, severely limiting choice and depth of talent.”

WFH arrangements have, Murdoch continued, reduced commuting time and expanded the geographic catchment area for in-house legal candidates in Australia: “A commute that may have been too long if it was five days in the office is achievable two or three days a week.”

Bargh said: “The rare role that requires full-time attendance will maintain the same salary and wait for the right candidate.”

If a business did look to pay more to have people work from the office more regularly, Murdoch added, “it would signal that they feel their lawyers are more productive in the office”.

This, he said, “is a much broader discussion they would need to have at the time of the interview”.

It would be interesting, Murdoch also noted, to see the response if a lawyer asked in an interview: “If I came to the office full-time, would you pay me more?”

Actual in-house recruitment challenges

Instead of offering more pay for full-time office attendance, Hunter went on, the primary challenges in attracting in-house legal staff are related to salary competition with law firms.

“Law firms continue to offer significantly higher salaries, making it difficult for in-house positions to attract top talent. Additionally, many professionals who made career moves in 2022 and 2023 are not eager to switch positions again so soon,” he said.

“This reluctance is impacting the pool of available candidates for in-house roles.”

Moreover, there may not be any guarantees that current levels of flexibility offered will sate the desires of prospective in-house lawyers, Stirling noted.

“Expectations have shifted so much, though, that some potential candidates have decided not to proceed with roles unless they only require two or less days in the office,” he said.

Ultimately, Stirling concluded, in-house roles requiring five days in the office are “still quite rare”, and when they do arise, they are more difficult to fill and the time to hire will generally be longer.

“So, as ever, employers need to look at the issue holistically and consider the business effects of waiting longer to hire and of a reduced talent pool against their perceived benefits of having the team full-time in the office, which are generally for cultural reasons and improved teamwork and learning,” he said.

A different approach needed?

Perhaps, Hunter suggested, instead of offering higher salaries to incentivise office attendance, businesses could consider adjusting salaries for those opting to work from home, as was reportedly floated by tech giant Google back in 2021.

“By reducing the pay of employees who choose to WFH, companies might find it easier to encourage more in-office presence,” he said.

“This method, applying a bit of the ‘stick’ rather than just the ‘carrot’, could balance the scales.”

“Additionally, with many employees now working four days for five days’ pay, there is already substantial flexibility in the system.”

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