MAGIC CIRCLE law firm Allen & Overy (A&O) has set the scene for an anaemic round of salary rises for City lawyers this year, after announcing pay increases of just one per cent or less for its associates.
A&O kicked off the 2012 remuneration season yesterday by matching the salaries it offers to newly-qualified associates to those of its fellow magic circle firms, who are all expected to release 2012-13 pay levels over the next few weeks.
Newly-qualified associates – those fresh from the firm’s two-year trainee scheme – will be paid £500 more than last year’s crop with a starting salary of £61,500. Lawyers two to three years post qualification will also see their pay packets rise by £500 per year, to £68,500 and £74,500 respectively. Fourth year associates will get a slightly larger raise, with salaries up by £1,000 to £86,000. Last year pay at the firm was frozen, though associates could move up the pay ladder by being promoted.
Despite the return to salary growth, the figures are well below the average rise in private sector pay, according to yesterday’s labour market statistics from the ONS.
Overall earnings in the private sector rose 1.9 per cent year-on-year in the three months to February, while financial services salaries were up 2.7 per cent, excluding bonuses.