Slimmons & Trimmons: Simmons & Simmons squeezes the belt
July 2, 2020
2 min read
What's going on here?
Having reported profit drops, staff at international UK-based law firm Simmons & Simmons were asked in early June to cut their pay by 20% and transition to a 4-day week for up to six months. This follows other measures taken by the firm to withstand the consequences of the coronavirus pandemic lockdown.
What does this mean?
In line with a range of “proactive decisions around business management to ensure that financial performance and stability endure”, according to a spokesperson, the 124-year-old firm has taken the bold decision to reduce salaries and working hours. In April, Simmons & Simmons had already announced their summer vacation schemes would now be held virtually across four days, and that students would be considered for training contracts as ordinary. Their First-Year Insight Scheme was moved to mid-August from May, supplemented by introductory webinars. Furthermore, similarly to Ashurst LLP, partner promotions have been delayed.
If the 20% pay cut and four-day work week are voted on favourably, this would strongly impact the work delivered by the firm’s staff. Whilst quality of work should not diminish, its rapidity may.
What's the big picture effect?
Simmons & Simmons is far from the only firm making tough choices in the face of economic difficulties. Taylor Wessing has furloughed associates from its UK offices and has implemented a flexi-working scheme to some of its lawyers, much like Simmons. Trainee salaries will be cut by 8%, however, the firm has committed to not cutting bonuses and is instead paying them in two installments over the year.
Reed Smith has taken its actions a step further by making a small number of staff redundant, freezing the hire of non-legal staff and is also transitioning to a four-day week. The primary aim of these measures is to safeguard as many jobs as possible whilst still providing high-quality legal services to top-tier clients who may need advising now more than ever. Much like their biggest clients, the legal industry is clearly not immune to restructuring – they are themselves undergoing radical changes to adapt to and bounce back from this singular situation. This means reducing costs wherever possible and reorganising work schemes.
The CEO of Herbert Smith Freehills has said that global cross-office meetings are to become the exception rather than the rule. Despite many economic measures being reportedly short-term, the legal workspace may be permanently altered once the world emerges from the pandemic. To keep attracting clients and aspiring solicitors, the competition is on between firms to prove their adaptability and will emerge the most resilient from the crisis.
There is a delicate balance to strike between prudence and financial impetus. It will be worth examining whether short-term economic measures such as those taken by Simmons will have a long-term effect on the quality and value of client services.
Report written by Anaïs Itani
Share this now!
Check out our recent reports!