So its salary and performance review time again and you should start to give some thought to both the performance and salary aspects of the review process. Each firm has their own process taking into account both objective and subjective criteria like billable hours and other contributions you make to the firm and your specific practice (like the latter really matters)! So before you start putting together your list of “unreasonable demands” and preparing your spiel about how invaluable you are to your firm give some thought to the economic realities that permeate elite law firms in Australia, including yours at the present time and devise a more cunning plan to demonstrate your worth so you can get the very best possible outcome both financially and the other stuff like all round praise and recognition for all of your valuable contributions to said firm over the past 12 months.
For most lawyers the first consideration come review time is “how much should I ask for?” As experienced recruiters we know this because each and every May/June as sure as the Autumn leaves we are fielding calls from lawyers from firms of all persuasions asking advice on what lawyers at their level in comparable firms should be making. It’s a fair enough question – but also a difficult one to answer. It’s a very subjective thing; despite there being some degree of lock step in Australian firms at different levels, we see in our day-to-day conversations with lawyers there can be marked differences in salary between lawyers at the same level within even the same firm. This largely comes down to practice area. Bonuses are also by and large in Australian firms discretionary and many lawyers we find go without whilst others will receive very attractive bonuses. So what makes the difference and what can you do to prepare for review time besides memorizing salary tables?
The first thing to do is sit down and do a frank examination of your last year in practice. The first question to ask is: how has your team as a whole performed? This will provide you with a context in which to make a proper assessment of what your firm can and can’t do at the present time financially. It’s about being realistic and anticipating the attitude your partners and HR managers will have to things like pay and performance. This is particularly important in a climate where pay freezes and other cost pressures and permeating law firms across the board.
Identify those people in your cohort who you and others consider to be the stand-out performers both in terms of budget but also the other important stuff like level of engagement with partners and clients, black letter skills and your commercial skills and acumen and how these have developed. Who knows you may be that person and as such everyone else will be using you as the gold standard and you can make this known to your partners. But if you’re not then it’s good to have a benchmark to use and one you can readily use as a base line leading into review time after making a frank assessment as to how you and your performance stacked up. The most important thing here is to be honest with yourself and identify the positives. If your team struggled this year with work flow and it was tough to make budget what else did you contribute which other areas did you develop and make significant gains besides being an all round nice person. Even in a tough economic climate these are things partners will be examining because things won’t always be bad and it’s in the lean times that the cream rises to the top but doing the other things like business development, making clients feel like gods, taking on the advice and mentoring of partners where and when they offer it, continuing to develop your black letter skills in terms of drafting, legal knowledge and research efficiency. It’s not just about your place in the team now but whether you can make yourself indispensible and whether you are seen as someone that adds value to your practice even in the lean times. Another thing to demonstrate as much as possible is being engaged with your team and clients on a commercial level wherever possible and that might mean elbowing now and then to get that exposure or information that gives you the complete picture on a deal rather than just staying focused on your little piece of the puzzle. It’s about demonstrating that you are not only a very good lawyer and counsel to clients but you understand their businesses, the reason they are involved in x or y transaction and that you also understand the business of law firms including the financial imperatives.
And this brings us to the second point which does revolve around financials. If you understand the business of large commercial law firms, recognize the pyramid structure that it is and the identify any challenging economic conditions this will provide you with a good grounding in which to make a sensible assessment about the prospect of any salary increase and the level at which you pitch your expectations. Being sensible on this point is key and of course it’s always easier in a competitive market to go into the meeting all guns blazing; pointing out to your partners that competitor firms are also doing amazing work and paying their associates 5 or 10 or 20% more. Plus they have a bonus scheme in place that could see you make another 20% on top of that. In the present climate this scenario will be less likely. There will be some exceptional lawyers or areas of practice in which there is still a skills shortage but by and large most corporate and finance practices aren’t performing on all cylinders and the bottom line is it’s just not that easy to pick up and leave your job and move laterally to where the grass is greener. When work flow is down it’s the associates that will suffer the brunt of austerity measures like salary freezes and it’s in this context that your upcoming review will take place particularly amongst the top tier firms in Australia.
So make a sensible assessment of what a fair salary review would like and know your firms lockset and progression salary bands going in. Each year as you progress from a PAE point of view you can expect a bump up so push for as much as you can but be realistic and don’t be disappointed if this year you don’t get as much as you had hoped for. Use the review as an opportunity to demonstrate your value nonetheless and take a longer term view. In good time things will get back on track and firms will be competing again for your talent. When the balance shifts in your favour again you can go back to your list of “unreasonable demands” and probably get them.
For more information on salaries both throughout the Australian and international private practice market as well as the in house market nationally check out our most up to date guides, salary surveys or just give us a call and we are more than happy to give you the lay of the land. We help hundreds of lawyers move locally and internationally and have our ear to the ground on all these things.For more information or a confidential discussion please call one of our experts on +61 2 9266 2900 or email firstname.lastname@example.org. For stories like this straight to your inbox, subscribe to our newsletter.