Trendspotting? Major U.K. Client Refuses To Pay Junior Biglaw Attorneys

Are junior associates really this "worthless"?

sad-upset-young-lawyer-summer-associate-law-student-stress-needs-help-300x199For almost a decade, major corporate clients in the United States have outright refused to pay full freight for inexperienced first- and second-year attorneys to work on their legal matters. In fact, according to a 2011 survey conducted by the Association of Corporate Counsel, more than 20 percent of respondents simply refused to pay for the work of junior attorneys on some matters. After all, some in-house counsel believe that first- and second-year associates are essentially “worthless,” and have no desire to fund their on-the-job training.

It now seems that the unwillingness to pay for junior associates’ work has spread across the pond to not-so-jolly old England. Legal Week reports via the Am Law Daily that for the first time ever, a major client has refused to pay its outside counsel for work performed by newly qualified lawyers (i.e., first-year associates) and trainees.

Which client is making Biglaw firms feel the pain? That would be Deutsche Bank, which made the decision as part of a panel review process when choosing the firms that will remain on its roster to represent the bank in various legal matters for the next two years.

According to Legal Week, Biglaw partners are far from pleased with bank’s decision:

The new payment plans—set out in the terms of the tender process, according to partners at panel firms—have upset some of those pitching for the roster.

One partner told Legal Week: “It has annoyed a lot of people. The process was more aggressive.”

Another partner said that this was the first time he’d seen something like this happen, and went on to comment on the policy’s unfairness: “I think it is fair enough for trainees, but for NQs it seems very unfair—they are proper solicitors, so why should they not be paid? I have heard about this at other banks; usually in the U.S., but never in Europe.” One wonders if this partner is genuinely upset that junior attorneys at his firm won’t receive their due even though they’re fully qualified to practice law, or if he’s genuinely upset that his firm will lose out on a significant chunk of change thanks to the implementation of Deutsche Bank’s new policy. Sadly, it’s perhaps the latter.

Either way, we’d like to welcome U.K. Biglaw firms to the world that U.S. Biglaw firms have been living in since 2008. Will more of your clients decide that your junior lawyers aren’t up to snuff and refuse to pay for their “worthless” efforts? Only time will tell.

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In a First, Major UK Client Says No to Paying for Junior Lawyers [Am Law Daily]
Deutsche Bank to refuse to pay for trainees and NQ lawyers after panel overhaul [Legal Week]


Staci ZaretskyStaci Zaretsky is an editor at Above the Law. She’d love to hear from you, so feel free to email her with any tips, questions, or comments. You can follow her on Twitter or connect with her on LinkedIn.

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