find the latest legal job
Corporate Counsel and Company Secretary
Category: Generalists - In House | Location: Newcastle, Maitland & Hunter NSW
· Highly-respected, innovative and entrepreneurial Not-for-Profit · Competency based Board
View details
Chief Counsel and Company Secretary
Category: Generalists - In House | Location: Newcastle, Maitland & Hunter NSW
· Dynamic, high growth organisation · ASX listed market leader
View details
In-house Projects Lawyer | Renewables / Solar | 2-5 Years PQE
Category: Generalists - In House | Location: All Australia
· Help design the future · NASDAQ Listed
View details
Insurance Lawyer (1-3 PAE)
Category: Insurance and Superannuation Law | Location: Sydney NSW 2000
· Join a dynamic Firm · Excellent career growth opportunity
View details
In-house lawyer 1-4 PAE
Category: Generalists - In House | Location: Adelaide SA 5000
· Leading Brand · Report to a Dynamic Legal Counsel
View details
Boomtown: Is all that glisters really gold for Perth law firms?

Boomtown: Is all that glisters really gold for Perth law firms?

With global firms moving in and local firms bulking up in the face of the resources boom, it seems the streets of the Perth may well be paved with gold. But are things really as good as they…

With global firms moving in and local firms bulking up in the face of the resources boom, it seems the streets of the Perth may well be paved with gold. But are things really as good as they seem? Claire Chaffey finds out.

THROUGH THE LOOKING GLASS: The arrival of global law firms and consolidation of Perth boutiques has changed the legal landscape in the Western Australian capital.
Two years ago, not one global firm could be found in Perth.

In Sydney and Melbourne, yes, but the quiet Western Australian capital did not yet feature in the sights of the world's biggest law firms looking to stake a claim in the Asia-Pacific.

How things have changed.

Perth now boasts six global firms: Norton Rose, Allen & Overy, DLA Piper, Clifford Chance, Holman Fenwick Willan and Squire Sanders. While the first five firms to arrive also have offices elsewhere in Australia, but the most recent arrival, Squire Sanders, does not. The US giant chose Perth as its sole antipodean base, and by doing so made the bold statement that it is here for a slice of the energy and resources pie - and everything else is an aside.

The events of the past two years mean that Perth is now firmly on radar of the world's legal powerhouses, and few would dispute that more will soon be elbowing their way into its increasingly crowded legal services market.

But with new names moving in, old names being swallowed up and a whole lot more competition for a lucrative corner of the market, questions must be asked about whether the reality of Perth will match expectations - and whether this new "golden" era is truly a boon for lawyers and law firms alike.

A morphing marketplace

Allion Legal partner Phil Lucas has been watching the events of the past two years with interest.

A boutique firm native to Perth, Allion has thus far weathered the global onslaught and Lucas says the arrival of global firms is actually creating more opportunities in the market.

"Some of the Perth boutiques have dropped off as they have merged with other entities, and what that has actually done, in some respects, is create more opportunities for us at the boutique end of the market," he says.

"The streets aren't paved with gold in Perth. A few of them in West Perth are, but the rest of Perth is tarmac"

Hylton Quail, president, Law Society of Western Australia

Quite simply, this is because Allion no longer has to directly compete with the likes of Blakiston & Crabb and Cochrane Lishman Carson Luscombe - two well-reputed boutique firms which have recently merged with Gilbert + Tobin and Clifford Chance respectively.

"There is demand in Perth for legal services to be provided to some quite large companies by firms such as us, and if [boutique] firms are diminishing in number, then clearly we see there is opportunity in the marketplace," says Lucas. "So, in a strange way, you could say that ... the opportunities are increasing at the moment, not decreasing."

Perth has long had a strong culture of top-notch boutique firms and it is arguably the quality of these firms which has attracted, and continues to attract, both national and global firms looking to snap up well-established talent.

And with the energy and resources sector booming, recruitment specialist Julianna Shearn of Shearn Legal believes more boutiques are likely to spring up in Perth as more global firms move in and companies look to use firms which can offer high-quality services at a lower cost.

"It is very hard to say what is happening, especially seeing as everybody is beating their own drum and saying that things are going great"

Doron Paluch, director, Burgess Paluch Legal Recruitment

"There will be more global firms to come ... [But] as soon as a global equity partner touches the work, it triples in price. So I really doubt that the Perth market can handle that," she says.

"And if you have got a big oil and gas company, a lot of their work is farmed out to the best firms. If it continues that way, you'll start to get conflicts of interest occurring, so you have got to go and find some new stellar people for the work to go to ... You'll have partners and senior associates going out and starting a new [boutique] firm because they know that that will happen."

Changing the landscape

According to the president of the Law Society of Western Australia, Hylton Quail, the arrival of the global firms has irrevocably altered Perth's legal landscape - but in a largely positive way.

"It is definitely changing the Perth market, because most of the larger firms which aren't allied or integrated with a multi-national firm are looking around; looking over their shoulders and considering their positions," he says.

"But they seem to have been well received. They have integrated into Perth fairly smoothly. I think that this is because of the models they have chosen - integrating with local firms or integrating with a large national firm. Obviously there have been some competitive tensions, but healthy ones."

"As soon as a global equity partner touches the work, it triples in price. So I really doubt that the Perth market can handle that"

Julianna Shearn, director, Shearn Legal

Quail also says the benefits of new firms coming to Perth are not just for the firms themselves, but also for Perth's local lawyers and businesses.

"I think it would be fair to say that the presence of the new multi-nationals opens up new opportunities that weren't previously available in Perth," he says. "It works both ways. They have not only come here, but they have enabled easier entry into global markets for Perth-based lawyers and Perth-based businesses."

According to Doron Paluch, a director at Burgess Paluch Legal Recruitment, the real impact of global firms is yet to be determined.

"I think the jury is really still out on what sort of impact [their arrival] will have," he says. "It is very hard to say what is happening, especially seeing as everybody is beating their own drum and saying that things are going great. Naturally, the national firms in Perth are suggesting they haven't been hit particularly hard. But the international firms themselves seem to be talking up the fact that they are getting approaches from lawyers who are looking to join them, and that they are winning work above and beyond what they were expecting."

Taking to the battlefield

With the rapid expansion of energy and resources work has come the problem of finding talent.

Lawyers with experience in the area are few and far between, and this is providing a significant challenge for firms trying to increase their presence in Perth.

Earlier this year, Allens Arthur Robinson offered staff a $20,000 spotter's fee for successful referrals to its Perth office, and firms across the board are trying to differentiate themselves in the marketplace to lure the best and brightest.

One firm experiencing such difficulties is mid-tier firm Middletons, which is significantly growing its Perth practice and has recently relocated to new premises to accommodate this. But finding lawyers to place behind desks is an ongoing issue.

"The war for talent in Perth is definitely a war - it's not a battle," says Middletons managing partner Nick Nichola. "It's very difficult. We rely on trying to differentiate ourselves a little bit. We are a mid tier. We are not pretending to be a top tier or a mega firm. We just play to our strengths in terms of being focused in what we do."

"In a strange way, you could say that ... the opportunities are increasing at the moment, not decreasing"

Phil Lucas, partner, Allion Legal

For Lucas, finding talent has not been such an issue, though Allion has largely been recruiting senior lawyers at the top end of town.

"In the last year we have recruited quite a few new partners; one from Allens, a senior counsel from Freehills and three or four senior lawyers from Corrs, Blakes and Mallesons. So we have been very lucky in a recruitment sense," he says. "We have picked up some very high-quality people coming out of the large firms and slotting in very nicely here. What that all adds up to is the ability to provide legal services that we think are comparable to the national firms, because all of our people are national firm people."

According to Lucas, Perth lawyers are snapping up the opportunity to work in a boutique firm and enjoy the lifestyle that comes with it. "Most of our work would sit comfortably inside national firms, so we can give our people the opportunity to do quality work, but they don't have to put up with the issues you have to put up with if you're working inside a national firm," he says.

Quail acknowledges that when it comes to lawyers with between three and five years' experience in areas such as energy and resources and construction, there is a serious lack of available talent. But this, he says, is certainly not the case across the board.

"This is a story of a two-speed economy," he says. "There is no doubt that in some practice areas there is, if not a crisis, a real tightening of the market. But it is only in those particular practice areas, namely resources. If you are in resources, it is not quite 'name your price' but there is a shortage of the lawyers with the necessary experience."

However, if you happen to be a recent graduate or work in pretty much any other area or law, Quail says things are actually very difficult.

"We still have far too many graduates coming through who we can't give jobs to," he says. "If you are not in resources, there are plenty of lawyers in Perth who are going through tough times ... The streets aren't paved with gold in Perth. A few of them in West Perth are, but the rest of Perth is tarmac."

A harsh reality

The extent of Perth's graduate overpopulation is making itself known in various circles. According to Shearn, the primary reason behind it is an increasing number of universities offering law degrees.

"We have got far too many graduates. There are five law schools now," she says. "We are trying to find people jobs and we can't, because they just can't go anywhere."

"The war for talent in Perth is definitely a war - it's not a battle"

Nick Nichola, managing partner, Middletons

So great is the backlog of graduates, says Shearn, that aspiring young lawyers can't even find placements for their College of Law practical legal training requirements.

Another who has noticed the state's significantly over-lawyered status is Nicola Stott, the director of legal process outsourcing (LPO) provider Exigent, which is based in Rockingham, just south of Perth.

"We put an ad on SEEK [for one of our projects] and I could not believe the amount of people who came forward - and great people," she says. "We had them queuing out the door."

And Stott says that more and more graduates and lawyers are opting to look at alternatives such as LPO in order to get a foot in the door.

"They are absolutely crying out to gain even first-level experience and actually do real work, but they are struggling to find positions within law firms," she says. "They are struggling because they don't have any experience, so this is actually a great way for them to touch and feel real work."

The situation in regional Western Australia could not provide a more stark contrast to the 'over-lawyered' Perth market.

"We put an ad on SEEK [for one of our projects] and I could not believe the amount of people who came forward - and great people"

Nicola Stott, director, Exigent

"We have got real problems in the regions, because everyone is in Perth. The regions are starved of lawyers," says Quail. "In fact, I would say that if there are interstate lawyers who don't want to come for resourcing regions, there is a dearth of lawyers in many of our regional areas. There are plenty of opportunities for lawyers to start up in country towns and make a really good living. Some of the most under-serviced regions are in fact those which are very wealthy, such as Karratha and Port Hedland. There are almost no lawyers up there, yet they are the highest per capita earning towns in Australia."

Exciting times

For those in the energy and resources sector and related fields, the outlook is bright and the firms who have chosen to establish themselves in Perth have done so for very good reasons. The downside of the boom, however, has been a rising cost of living which is outgrowing salaries, a shortage of housing and an increasingly crowded and expensive CBD. Despite this, Perth remains, for the moment, a vibrant place to be.

"It is an exciting time in Perth," says Paluch. "It is a combination of the mining boom, the general state of the market, and the emergence of not only international firms, but also very strong boutiques."

Lifestyle, too, continues to be typically laid back, says Quail. "The reason to [move west] is that you get all the advantages of the small city lifestyle," he says. "Perth is a fantastic place to live and bring up kids and you still have the opportunity to work on significant projects. That is what makes it attractive for lawyers."

And for Shearn, who knows what the future will bring. "They are exciting times," she says. "Every day is a new discovery."

Like this story? Read more:

QLS condemns actions of disgraced lawyer as ‘stain on the profession’

NSW proposes big justice reforms to target risk of reoffending

The legal budget breakdown 2017

Boomtown: Is all that glisters really gold for Perth law firms?
lawyersweekly logo
Promoted content
Recommended by Spike Native Network
more from lawyers weekly
Warning
07:03
NT Law Society sounds alarm on mandatory sentencing
The Law Society Northern Territory has issued a warning over mandatory sentencing, saying it hasn’...
Unite
Aug 22 2017
Professionals unite in support of marriage equality
The presidents of representative bodies for solicitors, barristers and doctors in NSW have come toge...
Aug 21 2017
Is your firm on the right track for gig economy gains?
Promoted by Crowd & Co. The way we do business, where we work, how we engage with workers, ev...
APPOINTMENTS
Allens managing partner Richard Spurio, image courtesy Allens' website
Jun 21 2017
Promo season at Allens
A group of lawyers at Allens have received promotions across its PNG and Australian offices. ...
May 11 2017
Partner exits for in-house role
A Victorian lawyer has left the partnership of a national firm to start a new gig with state governm...
Esteban Gomez
May 11 2017
National firm recruits ‘major asset’
A national law firm has announced it has appointed a new corporate partner who brings over 15 years'...
opinion
Nicole Rich
May 16 2017
Access to justice for young transgender Australians
Reform is looming for the process that young transgender Australians and their families must current...
Geoff Roberson
May 11 2017
The lighter side of the law: when law and comedy collide
On the face of it, there doesn’t seem to be much that is amusing about the law, writes Geoff Rober...
Help
May 10 2017
Advocate’s immunity – without fear or without favour but not both
On 29 March 2017, the High Court handed down its decision in David Kendirjian v Eugene Lepore & ...