Legal Business Blogs

The Brexit effect: BLP becomes the first City firm to freeze pay post EU referendum

City firm Berwin Leighton Paisner (BLP) has become the first law firm to freeze pay for UK staff following the British referendum that saw the country vote to leave the European Union.

The move will impact all UK-based staff, apart from partners who take a share of the profits, with pay reviews postponed from 1 July 2016 to 1 November 2016 following the Brexit vote. Staff were notified of the decision by email on Tuesday (5 July).

The pay freeze follows a slump in revenue at BLP last year, with income falling 2% to £254m in 2015/16. While some firms were caught off guard by the Brexit vote, with the Magic Circle and a host of US firms ramping up London salaries in the weeks leading up the vote, BLP labelled the pay freeze on associates, paralegals, business development, marketing and other back-office staff as the ‘prudent thing to do’.

It does, however, mean that BLP is now off the pace in the City salary stakes. The move means that associate pay will remain at the same levels that were set in July 2015, with newly-qualified lawyers paid £66,000 a year.

The firm said in a statement: ‘BLP has deferred its salary review process for UK-based staff for a period of four months from 1 July to 1 November 2016. BLP’s normal salary review date is 1 July. However, following market uncertainties arising out of the recent EU Referendum vote, BLP has decided that the responsible and prudent thing to do is to defer making UK salary decisions for a further four months. Employees who have been promoted will still receive related salary raises and bonuses referable to the prior financial year will also be paid.’

‘Successfully meeting and anticipating our clients’ needs at this time remains the critical focus for BLP and the thing that will ensure our successful future.’