Letter from London: Where Magic Happens

Ed. note: The legal world is much bigger than New York, or Washington, or even the United States. Welcome to Letter from London, a weekly dispatch from the other side of the pond. Our U.K. correspondent, Isaac Smith, will expose ATL readers to the latest goings-on in the London legal world. You can reach Isaac by email, at isaacsmithlondon@googlemail.com.

The G20 summit, accompanied by its anti-capitalist sideshow, arrives in London this week – and UK Big Law is feeling a little scared.

Law firms are warning employees not to wear suits on Wednesday or Thursday so as to avoid being targeted in the violent protests planned around London’s financial district.

Which provokes an interesting question: how ghetto does a corporate lawyer need to dress in order to avoid arousing suspicion as to their true identity?

We’ll soon find out.

It all seems a bit unfair, really. It’s not as if lawyers got the super big bonuses. And now their salaries are actually falling. If those nasty anti-capitalists had bothered to have a quick scan of The Lawyer last Wednesday, they’d have seen that Shearman & Sterling’s London office had followed Freshfields in cutting newly qualified associate salaries by 8%.

Are we going back in time? More after the jump.

Sponsored


Getting back to where we once belonged

The pay cuts are one of a number of factors contributing to an increasing sense that this country is going back in time. With house prices down by as much as 60% in some areas, unemployment at levels not seen for over a decade and the IRA even making a comeback, we’re wondering what comes next.

A relaxation of the law against selling fireworks to children? A return to the widespread use of asbestos? A re-introduction of smoking on British Airways flights?

Speaking of British Airways flights, if you take one from London to a South American/South East Asian capital city in the next few months, it’s likely you’ll find yourself sitting next to one of the many UK law graduates who’ve had their training contract start dates put back. Be nice to them, they didn’t get paid as much to defer as you. Clifford Chance, which announced its voluntary deferral scheme on Thursday, is the UK’s highest payer with £11,000. In contrast, Weil is giving US recruits up to US$75,000 (£51,623) to hold off for a year.

This deferral thing has been happening in London for a while now, but the fact that a ‘magic circle‘ firm did it has made everyone sit up and pay attention. As you may have noticed, we have a bit of a weakness for that ‘magic circle’ term over here – with even the hardest-nosed of British businessmen going weak when they hear it, overcome by images of kindly wizards and story telling bears.

Sponsored

So where the hell did this phrase come from?

According to one poster on a recent legalweek.com article on the subject (scroll down – 10th post), it was coined by reptiles. Others suggest that journalists were responsible.

As a nation, you’re clearly less susceptible to such branding – as evidenced by the David Beckham-like failure of any of our magical firms to truly make it big in the US. And with Clifford Chance cutting 24 associates from its New York office in redundancy round number two last week, it doesn’t look like that’s about to change anytime soon.

A couple more things

Since the recession started, Australian and New Zealand lawyers have been among the first to get the chop at several London firms – so Aussies and Kiwis at Freshfields will be shifting nervously in their seats after the firm sent them an email outlining the procedure they have to follow to stay in the UK if they lose their jobs. Freshfields, which still hasn’t made any official redundancies, insists that it has no plans to cut staff.

On a slightly different note, British Prime Minister Gordon Brown is in talks with Buckingham Palace over changing the law to allow Catholics to inherit the throne.

Elsewhere on our green and pleasant island…

Newcastle is a city in the north east of England whose residents are known as ‘Geordies‘ and speak in accents so strong that people from elsewhere in the UK struggle to understand them. Sting is an example of a Geordie who has successfully toned down his accent in order to achieve wider success.

On Tuesday, Newcastle-based law firm Watson Burton launched a redundancy programme which could claim 75 employees, including partners, associates and support staff – that’s 25% of its total headcount.

What have we learned?

Salaries can go down as well as up – and the past, my friends, remains firmly with us.

Quote of the week

A promotional announcement from the guys over at G20 Meltdown: “At 12 noon, April 1st, we’re going to reclaim the City, thrusting into the very belly of the beast: the Bank of England.”

Find out how many lawyers were eaten alive by hate-filled mobs next week.