Legal Recruitment from Ten-Percent Legal

Sunday, June 09, 2019

Legal Recruitment News June 2019

Wednesday, June 05, 2019

The Brain Drain from High Street Law Firms, caused by Large City Law Firms. Fake News?

I was recently telephoned by a journalist who wanted a discussion about a brain drain that was supposedly happening in the UK. Working on behalf of a couple of banks and their news feed, the journalist had been handed a brief to write an article about the supposed brain drain that was occurring from rural and town locations into a couple of large cities, which is where most lawyers were based. The journalist wanted to know if we had come across this phenomenon and if I could give him a quote about it. 
 
Thinking back, what I ought to have done was immediately record the conversation so that I did not have to dictate this and produce a new article entirely! But unfortunately I was not that fast in thinking.
As pretty much any solicitor in the UK will probably tell you, this particular assertion by the banks is virtually impossible to have occurred and is a non-news story, simply because of the wide divide between corporate and high street law. The journalist had been informed that solicitors practices on the high street were struggling to recruit solicitors because the large corporate firms in the cities were recruiting them all.
This exposed a deep misunderstanding in the way the legal profession in the UK is structured, and I am surprised that no-one in the banks concerned actually knows what the difference is between  varying types of law firms. So the first part of this article is entitled ‘city versus high street law firms’.
City v high street law
There are two different streams to law and it is important to understand the difference. The first of these streams is the corporate world, and the second of the streams is the high street. It is very rare that the two actually meet.
We understand that at present there are between 110,000 and 120,000 solicitors in England and Wales. From these 110,000+ solicitors probably around 85,000 of them work in high street or local authority roles that pay salaries of up to around £50,000.
These solicitors are collectively referred to as high street solicitors or, if preferred, non-corporate solicitors.
The remaining solicitors, probably around 25,000, possibly less than this, work in large corporate law practices. Their usual client range consists of blue chip companies and internationally based high net worth individuals with blue chip companies or large trusts. These are the corporate lawyers and there is a very large gap between the solicitors who inhabit this world and those who work on the high street.
The main difference is that corporate solicitors act on behalf of corporate bodies and in some cases large public institutions such as the NHS or the government. They very rarely act on behalf of individuals or undertake any types of law that relate to individuals rather than corporates or companies. The high street firms act on behalf of individuals and small businesses, commonly known as SMEs (small to medium sized enterprises). Payment levels are considerably less than solicitors who work in the high settings tend to have hourly rates to their customers billed at between £150 per hour and £300 an hour. City lawyers start their billing at around £250 per hour and head rapidly upwards.
As a result of these billing levels, salary ranges are astonishingly different. On the high street, as indicated, most solicitors earn less than £50,000 for the duration of their entire career. I should say that this is £50,000 per annum (i.e. per year) and this is because the returns from high street law tend to be extremely different to those from corporate law.
In corporate firms trainee solicitors can be earning £50,000 per year with the vast majority spending the overwhelming part of their career on six figure salaries, reaching well up towards the £250,000 to £500,000 income bracket. This is a very different world and one of the reasons the journalist’s line of enquiry was so wrong is that it is really rare for a high street solicitor to end up in a corporate law firm.
How hard is it for a high street solicitor to become a corporate commercial solicitor?
It is probably easier to get elected as an MP than it is to cross from high street law into commercial law. It does not happen and the vast majority of the 85,000 solicitors or so who practise on the high street or in similar types of roles will never see the inside of a corporate law office unless they take a second job emptying the bins.
This is usually because of the stringent entry requirements required to get into commercial law firms compared with the high street. To become a corporate commercial solicitor working in one of the large London practices, whether Magic Circle, Silver Circle or Legal 100, it is usual to have exemplary academics, good connections, an outstanding level of work experience prior to entering into the profession, and a whole wealth of extracurricular activity that lends itself to promoting particular candidates over others.
So for most corporate commercial solicitors it would be very rare indeed to see one with a 2:2 law degree or any A levels that do not have the letter A in them. Similarly one would expect to see a degree from a high quality Russell Group University or Oxbridge, details of top quality work experience on vacation placements with large London law practices, and plenty of extracurricular activities probably involving debating, team sport and a high level of attainment.
You would not expect to see a candidate with a 2:2 law degree from the University of Wolverhampton working for Clifford Chance. Please contact me if I am incorrect in this assertion as I would love to be able to highlight your case!
These are simply harsh realities and as ever with these articles please don’t shoot the messenger! Most high street solicitors will have similarly good academics, but just not as good as corporate lawyers unless they have deliberately chosen not to enter the corporate commercial field, as some do. There are benefits of not working for corporate commercial firms – having a family life or undertaking activities away from the office are usually two things that solicitors find difficult working for large London corporate firms who require 12 to 18 hour days at times, and put their solicitors under huge amounts of pressure to work flat out, including at weekends. Helpful if you are a workaholic, but a nightmare if you are trying to run a football team on behalf of your children for example.
Most high street solicitors will be quite content with their lot, but even if they are not, the chance of them moving into a corporate field and contributing to the total brain drain that a couple of banks appear to have invented is virtually impossible, and I have to say that if banks are thinking this there is something seriously wrong with their knowledge of the legal profession. 
What is a Corporate Commercial Solicitor?
During this article I have referred to corporate commercial solicitors but not really defined what these are. Corporate commercial law is a description that covers a wide area of law that usually relates to work being undertaken for large companies and commercial entities. So for example it will include the administration of companies, the drafting and approval of commercial contracts, the involvement of solicitors in the mergers and acquisitions of companies and other commercial entities, the finance that is going on behind the scenes to fund the activities of companies, and lots more besides. High street law and working for the private individual can be the conveyancing of property, the drafting and administering of wills (and of course probate after death), any litigation that individuals find themselves in, any litigation that small companies find themselves involved in (usually referred to as commercial litigation), and all other things that relate to individuals and small businesses rather than the intricate workings of corporate entities. It is quite an easy term to use to differentiate commercial work from high street work, and these two particular definitions should be considered in tandem with each other in the same way that contentious and non-contentious law are.