England: Senior in-house lawyers see earnings boost as demand increases

Senior in-house lawyers have seen their pay rise by more than £8,000 this year, according to the latest research from specialist legal and compliance recruiter Laurence Simons.

Lawyers’ average total earnings (basic salary and bonus) now stand at £165,190 – which is £8,130 (five per cent) higher than 2015’s typical package (£157,060).

This has been driven by a significant increase in basic salaries for senior in-house lawyers over the last 12 months – rather than bonuses. Between 2015 and 2016, basic salaries increased by 12 per cent from £112,920 to £126,100, which in cash terms amounts to £13,180.

Bonuses, meanwhile, have shrunk. In 2015, the typical senior in-house lawyer commanded a bonus that stood at 39 per cent of basic salary – or £44,130. This year the average senior in-house solicitor reported receiving a bonus of 31 per cent basic salary, or £39,090.

Despite this, the size of the average bonus remains significantly higher than the £31,500 reported in 2014. With 72 per cent of senior in-house lawyers set to receive a bonus in 2016, this means they are going to share a £570 million bonus pot. This is nine per cent down from the £623 million bonus pot they took home last year, when 70 per cent of senior in-house lawyers received a bonus.

Salaries for senior-in house lawyers are significantly larger than those taken home by accountants. The £165,190 taken home by senior in-house lawyers is more than double the average UK accountants’ total earnings of £78,010.This is also nearly six times the size of the average £27,600 salary.

Clare Butler, global managing director at Laurence Simons, said: “High spending on the salaries of top in-house lawyers is not merely corporates splashing the cash, but represents a structural shift in their approach to the provision of legal services. While legal is mission critical, most corporates don’t have huge budgets to spend on elite firms. The result of this is a greater focus on building stronger and broader in-house teams, which means recruiting lawyers from private practice at a premium.

“As a result of this competition, salaries for senior in-house lawyers are increasing. While a big salary for an experienced lawyer is a significant outlay, it is an important investment that can save a company huge amounts of money in fees and costs.

“The paradigm shift in the provision of legal services has had a knock on effect for in-house lawyers, and we are seeing pronounced demand for a more predictable and stable income that isn’t tied to the performance of their employer.

“With demand in their favour, they’re in a strong position to not only dictate how much they are paid, but also the structure of their remuneration.”