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Corporates pay highest average legal salaries, report says
Legal professionals have an average salary of $102,100 – but new research from the College of Law has shown that law firms pay, on average, less than government and big corporates, with 35 per cent of lawyers in firms also not receiving a salary increase over the last two years.
Lauren Croft
Higher salary averages now exist within corporate organisations compared to law firms, according to the College of Law’s Australian Legal Salary Survey 2024.
Now, law firms have been revealed to have the lowest average salaries, as more than a third of lawyers in firms reported not receiving a salary increase over the last one to two years.
The survey was conducted in late 2023 and early 2024 and comprises responses from more than 1,300 lawyers from across the country.
The largest respondent age group was 25 to 29 years (34 per cent) – an age group between Millennials and Gen Z. Twenty-five per cent of these respondents worked in boutique firms, with 14 per cent working in government departments, 12 per cent in large firms, 11 per cent in sole practices and 10 per cent in corporate organisations. The predominant role was solicitor at 43 per cent, followed by law clerk/ graduate at 13 per cent.
According to the College of Law, the largest group of respondents (615 respondents) hold one to five years of experience and average a base salary of $90,244. Those with less than one year of experience (163 respondents) averaged a base salary of $82,277. Lawyers with six to 10 years of experience (184 respondents) averaged a base salary of $124,493.
Those with more than five years of experience had salaries above the average base salary, with a slight drop among those with more than 15 years of experience – however, the report noted that these lawyers are more likely to work part-time (19 per cent), which may contribute to the drop.
“When looking at the largest respondent group (one to five years) by organisation, law firms paid the lowest average annual base salary at $85,023, followed by not-for-profits (NFPs) at $95,111, government agencies at $100,239, and corporates topped the scale at $108,066,” the report stated.
Additionally, corporate organisations had the highest salary for 11–14 years and 15-plus years of experience at $218,333 and $232,099, respectively. These higher salaries also come with bonuses – which, according to the report, are most commonly offered to legal professionals at law firms (36 per cent) and corporate organisations (59 per cent).
In contrast, only 7 per cent of legal professionals who work at government agencies and NFPs/CLCs are eligible for these bonuses. Of those who are eligible for performance-based bonuses, 53 per cent of them reported an annual bonus between $1,001 and $10,000, calculated through personal key performance indicators (KPIs).
Billable hours and raises
Across the respondents surveyed, 52 per cent reported not having expected billable targets. CEO of the College of Law, Neville Carter, said that this – as well as the pandemic – was evidence of a changing profession.
“The impact of the pandemic and the resulting evolution of the workplace appear evident in the feedback we have received,” he said.
“Another indication of industry change is that only 56 per cent of the respondents working in law firms have individual billable targets.”
In law firms, only 3 per cent of respondents had team-based targets, 9 per cent both targets, and 32 per cent had no targets. Twenty-eight per cent were expected to bill 5.1 to six hours per day, with 26 per cent having a target of 6.1 to seven hours per day. Sixty-two per cent were incentivised to achieve these targets, with the most common incentive being between $100 and $500.
Finally, the report noted that 46 per cent of all respondents surveyed had received a salary increase within the past one to two years. This includes 44 per cent of respondents in law firms, 48 per cent in government, 41 per cent in NFP and 57 per cent in corporate. The most common salary increases as a percentage for law firms, NFPs and corporates sat between 5 and 10 per cent, while government raises were generally less than 5 per cent.
However, 35 per cent of those working in law firms said they hadn’t received either a salary or CPI increase over the last two years. Almost three-quarters of respondents have a salary review at least annually – most common in corporates (83 per cent). Interestingly, one in five of those working in law firms indicated their salary reviews occur “haphazardly”.
This follows speculation that lawyers would be unlikely to receive above-CPI wage increases in 2023, with one recruiter noting that many would be disappointed with their raises compared to previous years.
More to come.
Lauren Croft
Lauren is a journalist at Lawyers Weekly and graduated with a Bachelor of Journalism from Macleay College. Prior to joining Lawyers Weekly, she worked as a trade journalist for media and travel industry publications and Travel Weekly. Originally born in England, Lauren enjoys trying new bars and restaurants, attending music festivals and travelling. She is also a keen snowboarder and pre-pandemic, spent a season living in a French ski resort.
