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Global firm cuts equity partner cash flow by over 50%
A global law firm with an Australian presence has implemented measures for the months of May and June 2020 to combat COVID-19.
Jerome Doraisamy
Dentons has announced numerous measures to combat the economic effects of the global coronavirus pandemic, noting that while some practice areas remain busy, the firm is preparing for falling revenue.
With that in mind, the firm – in a statement provided to Lawyers Weekly – said that salaries are being reduced by 20 per cent, with employees to either continue working full hours and take some leave days each month, or work reduced hours.
Further, Dentons equity partners are reducing both their monthly take-home pay and have frozen their profit distributions, which amount to a reduction in cash flow of more than 50 per cent for those professionals.
The new measures will apply to all 449 staff and 70 partners across Dentons’ Australian offices.
“Our agile business allows us to redeploy some of our employees to areas that are seeing an increase in work, but we also have a responsibility to do everything we can to preserve the jobs of our people,” Mr Stipanicev continued.
“We have taken a conservative look at our profit forecast for the coming months, and we believe the approach we have asked our employees to agree to will ensure we can preserve as many jobs as possible, and come out in a strong position on the other side.”
Dentons ran a “comprehensive consultation process with everyone in the firm”, Mr Stipanicev continued, holding eight town halls and then giving employees the option of agreeing to the measures.
“I’m extremely proud of our people, who have embraced this challenge and come together to agree to the measures for the greater good of our business and our clients,” he proclaimed.
“Our focus will continue to be on our clients, leveraging our global networks for their benefit; and in supporting our staff through this challenging time.”
Mr Stipanicev proclaimed that COVID-19 has moved the legal industry more quickly to digital solutions and virtual ways of working.
“We’re taking the opportunity that these times present us with to offer solutions our clients that solve their business challenges, such as the use of automation and robotics to drive the integration of the eco-legal system of business and legal; manage contracts more efficiently with digital signatures; and pricing and alternative fee arrangements that can be done overnight instead of weeks/days,” he concluded.
The news follows reports from this week that Colin Biggers & Paisley has cut salaries by 20 per cent and partner remuneration by 20 per cent to 40 per cent, depending on one’s seniority. Further, Clifford Chance has paused salary reviews and deferred partner profits, HopgoodGanim Lawyers is cutting salaries for staff earning more than $65,000 by 20 per cent, directors and senior executives for plaintiff firm Slater and Gordon will see their pay reduced by 10 per cent to 15 per cent and Sparke Helmore has cancelled pay rises for this year for partners and employees.
Lawyers Weekly has also reported on the measures taken by dozens of other law firms in the wake of the pandemic. Those reports can be found here.
Jerome Doraisamy
Jerome Doraisamy is the editor of Lawyers Weekly. A former lawyer, he has worked at Momentum Media as a journalist on Lawyers Weekly since February 2018, and has served as editor since March 2022. He is also the host of all five shows under The Lawyers Weekly Podcast Network, and has overseen the brand's audio medium growth from 4,000 downloads per month to over 60,000 downloads per month, making The Lawyers Weekly Show the most popular industry-specific podcast in Australia. Jerome is also the author of The Wellness Doctrines book series, an admitted solicitor in NSW, and a board director of Minds Count.
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