A range of Australian law firms are taking steps to cutback on both partner drawings and salaries as they fight off the effects of the Coronoavirus crisis.
An international law firm is reducing partner drawings and has asked employees to adopt an 80 per cent work pattern and equivalent remuneration reduction, among other new measures to combat COVID-19.
Ashurst has developed a “Stronger Together’ program to try and protect jobs and ensure the health and ‘financial resilience’ of the firm is preserved during the coronavirus crisis.
“As a global business, Ashurst like many others is affected by the economic disruption being caused by COVID-19,” said global managing partner Paul Jenkins. “We start from a solid financial position and so far across the firm, our activity is holding up well in the circumstances. We are looking ahead in a responsible way however, and must anticipate that given the global economic slowdown we may see less activity in the markets in which we operate.
Ashurst measures include a reduction in monthly sums paid to partners by 20 per cent for the next six months, a deferral on salary reviews for the coming 2020-21 financial year and bonuses for eligible staff will be staggered, with 50 per cent to be paid in July of this year and the remaining 50 per cent paid in November.
Herbert Smith Freehills has also announced that it had reduced partner profit distributions and cancelled salary reviews in order to ‘remain resilient’. The salary freeze will hit the firm globally and HSF is to make its 2019-20 bonus payments in two halves – July and December.
HSF has also resolved to award bonuses for the 2019-20 financial year, albeit by way of 50 per cent payment in July 2020 followed by another 50 per cent instalment at the end of the calendar year.
Holding Redlich also recently announced that it would reduce partner draws by 10 per cent and mid-level Macpherson Kelley has required partners to work five days but be paid for four, creating an effective 20 per cent pay reduction for principals.
As with most firms, they have all slowed down on hiring and refocused on providing their services remotely and with enhanced online activity.
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