London lawyer hiring frenzy hits record as pay wars rage

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A record number of senior lawyers have moved jobs to London this year as an influx of US law firms to the capital disrupts the market and fuels a pay war for talent.

Law firms hired 546 partners in London as of December 23, according to data from legal recruiter Edwards Gibson and shared with the Financial Times. The number surpasses last year’s record 514 partner moves, as investment by US law firms in the UK shows no sign of abating.

London’s legal market has undergone major disruption in recent years as a booming private equity market has driven a significant expansion of profitability. American Law Society Deep-pocketed US firms in the city have lured partners from their UK-headquartered rivals and, increasingly, their US peers.

of the United Kingdom “Magic Circle” group of organizationsThose that include Linklaters, Freshfields, A&O Shearman and Clifford Chance have been particularly hard hit, losing a record 28 partners this year, beating the previous record of 19, according to the data.

The war for talent has led to changes in firms’ pay structures as they struggle to attract and retain rainmakers and more. junior talent. Groups such as Clifford Chance and America’s Latham & Watkins have recently added more flexibility to their own models to better reward top performers, according to people familiar with the moves. Both companies declined to comment.

“Private equity-related recruitment has pumped millions of dollars into the unprecedented investment system of US law firms,” ​​said Scott Gibson, founder of Edwards Gibson. “This distorted the market by increasing compensation and creating huge knock-on effects down the chain as helpless rivals scrambled to restock.”

US-based firms Kirkland & Ellis and Paul, Weiss, Rifkind, Wharton & Garrison were among the biggest hires in 2024, according to the data, which included 155 lawyers who moved from non-partner roles to partner.

For the past year, Paul Weiss has wanted it Fast build up 10-fold growth across Europe with its London presence and the opening of an office in Brussels for US private equity clients on the continent.

“Our private equity and corporate clients are focused on having elite legal counsel throughout New York and London,” said Neil Sachdev, co-head of the Paul Weiss London office. “Many firms are looking to replicate the growth in London as it is a key legal market for M&A and capital markets and a gateway to Europe.”

Some UK-headquartered mid-tier firms have also benefited from churn, as larger firms move out of less profitable practice areas such as low-value routine work for financial services firms.

Simmons & Simmons hired 16 new partners this year, according to the data, making it the second largest recruiter in 2024.

“The influence of US companies is very significant and you can see that some companies have decided that they are committing themselves to a certain profit target. This is driving some of their strategies and they can no longer afford to advise on specific areas of the market,” said Jeremy Holland, Simmons & Simmons managing partner.

“Some of the partners we’re talking to aren’t feeling the love they’re used to,” she added.

The recruitment frenzy has led to raids in a number of top outfits; Latham & Watkins and Linklaters saw the largest number of exits.

Latham has lost eight of its 13 partner exits to Sidley Austin this year, while Linklaters has also seen several departures for US peers. Ed Barnett, London managing partner at Latham, said the capital “has been a strategic priority for decades” and the firm “had an incredibly strong year”. Linklaters declined to comment.

While not all departures will be seen as losses, it has been difficult to compete with the eye-watering pay packages on offer to partners, said Charlie Harvey, founder of legal recruiter Harvey & Partners.

“We’ve worked with law firm partners in the London market who have doubled or tripled their compensation when moving,” says Harvey. “We see no sign of lateral partner recruitment slowing as we move into 2025.”