Hefty pay windfall for lawyers
Hong Kong legal firms are handing out pay rises of up to 30 per cent in the wake of dotcom defections, a salary war on both sides of the Atlantic and a tighter market.
Recruiters estimate large firms to have lost between one and five associates to Internet start-ups over the past 12 months.
Although they are split on the direct impact this has had on remuneration, the recruiters nevertheless cite salary increases of 5 per cent to 30 per cent being paid during the present pay review season.
At the same time, the effects of the dotcom exodus in the United States - where law firms were forced to raise salaries by up to 50 per cent - have been causing repercussions at some practices.
Firms paying their lawyers more in New York for example have been forced to increase the salaries of their London counterparts.
Clifford Chance recently bolstered salaries for newly-qualified lawyers in Britain from GBP35,000 (about HK$409,150) to GBP42,000, for example.
For some firms, this trend has then trickled down to Hong Kong.
'I think it's fair to say that practically every law firm, every accountancy firm and every management consultancy firm has been dealing with competition from dotcoms,' says Baker & McKenzie partner and spokesman Richard Weisman.
'That's a fact of life, and it's not going to go away.' Baker & McKenzie, one of the largest global law firms, will announce a pay rise in the SAR next week. 'We will be substantially increasing our salaries at every level,' Mr Weisman said, declining to give a figure.
Others estimate the pay hike to be on average 10 per cent. Angela Chopra, managing consultant at recruitment firm QD Legal cites figures of up to 30 per cent at some practices.
However, she is sceptical of the dotcom factor - or the impact that salary wars in the US and Britain have so far had in Hong Kong. She is nevertheless 'watching with interest'.
Firms in Hong Kong have moreover traditionally paid higher rates - for example, a newly-qualified associate in Britain might earn GBP35,000 compared to GBP60,000 in the SAR.
Angelina Leong at recruitment firm Tully & Co, however, believes that the 'cross-fertilisation' between the US and British firms ultimately will have an effect on Hong Kong salaries.
Another factor swelling salaries in the SAR is the tightening of the market.
Recruiters are faced with a smaller pool of talent to choose from in Hong Kong, and have been looking further afield - to Singapore and Australia - to fill posts.
Pay packets have become more competitive to woo the top-tier candidates.
'Salary increases are coming back, that's definitely the case,' said Conor Greene of recruitment firm Law Alliance. 'All these things are going to have an impact: I haven't put my finger on one particular thing.' The legal landscape in Hong Kong has also seen increased activity over the past year with numerous lateral hires - where lawyers jump ship to rival firms - and the return of lucrative corporate finance and initial public offer work.
