What is the McKenzie Corridor
Associate salaries: Baker McKenzie wants to pay more performance-related
Baker McKenzie gets creative in the race to find attractive salaries for associates. The law firm is not only increasing the salary significantly, it is also introducing a success bonus and a "booster".
With a new remuneration model, Baker McKenzie wants to pay the employed lawyers more performance-related and thus promote their "entrepreneurial potential", as the law firm reports. Instead of a fixed salary, there is now a salary corridor for associates on the partner track. A career starter will earn up to 120,000 euros instead of the previous 105,000 euros, and in the second year the salary will then be between 110.00 and 125,000 euros.
In addition, from the third year onwards, the law firm pays a "success fee" of up to 10,000 euros. According to the firm, this premium is based on the amount of time spent on client work, turnover or profitability. In the fourth year of employment, the salary is in a range between 122,000 and 143,000 euros, the additional success bonus can reach up to 15,000 euros.
This bonus is even higher with Senior Associates: In the fifth year of employment, the bonus increases to a maximum of 25,000 euros - with a base salary of 130,000 to 157,000 euros. In the sixth year, a lawyer can improve his salary, which then lies between 139,000 and 165,000 euros, by up to 35,000 euros with the success bonus.
"Booster" for entrepreneurial ideas
Baker McKenzie also introduced a "Talent Management and Business Development Booster". What is meant is an additional budget that is available to associates from the third year of their career. Each mid-level associate has up to 2,500 euros per financial year at his disposal; he can use the money "for the planning and implementation of entrepreneurial ideas within the framework of the law firm," according to Baker McKenzie. Each senior associate is entitled to up to 5,000 euros per financial year. With the booster, the law firm says it wants to promote initiatives by its associates, especially in the field of digitization.
The law firm also increases the fixed salary for associates on the "alternative track", which does not end in a partnership but in a permanent employment relationship. It rises from 60,000 to up to 80,000 euros in the first year of employment. As on the partner track, associates can significantly improve their fixed salary with a bonus scheme. In the first two years of employment - depending on the performance of the associate - up to an additional 5,000 euros are included.
From the third year onwards, this bonus increases to a maximum of 10,000 euros; in addition, up to 7,500 euros can be distributed - the amount of this amount depends on the profit made by the associate in the respective financial year. In the sixth year of employment, the performance-based component of bonus and profit sharing increases to a total of 27,500 euros, while the basic salary is a maximum of 120,000 euros.
Alternative model in the race for the highest salary
With this compensation model, Baker McKenzie takes a different approach than many law firms that only pay their associates a fixed salary in the first few years. A few months ago, numerous law firms increased their starting salaries significantly, and now an annual salary of 120,000 euros for a young professional seems to have established itself as the standard remuneration in top law firms.
In addition to Baker, DLA Piper recently added a performance-related component to its associate compensation. In addition to the basic salary, there is a variable component, which is measured by the number of billable hours worked, as well as a success bonus that rewards further services for the law firm, for example generating business or developing a new area.
ah / LTO editorial team
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