The impact of the Australian downturn has once again been thrown into sharp relief after DLA Piper’s staff in the region were told not to expect pay rises and some partners to expect a drop in pay as the office failed to meet its targets.
As first revealed by RollOnFriday, an email from chief operating officer and stand in local managing partner Andrew Darwin told staff ‘for many…there will be no increase in base salary this year and for others there will only be a modest increase.’
Local partners, meanwhile, were told: ‘many partners will have no increases or, in some cases, a reduction in their remuneration.’ Further savings are also expected to be made on expenses.
Darwin in March began a stint as Australian managing partner while the firm looks to re-energise the local practice and ‘groom’ home-grown talent.
The move comes as a number of firms show signs of struggling at the hands of the depressed conditions in Australia and low revenues across the wider Asia-Pacific region, with UK managing partners reporting that it must be viewed as a long term game.
In March, Herbert Smith Freehills blamed market conditions for deferring staff pay reviews in Australia. Moreover, Asia-Pacific accounted for only 13% of the firm’s revenues this year, according to LB Global 100 results, despite the firm having 15 offices across the region, five of which are in Australia.
DLA merged with its Australian alliance firm Phillips Fox in May 2011, having had an exclusive referral relationship since 2006. The merger formed part of DLA’s global strategy to strengthen the firm’s presence in G20 economies.