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Earning big salaries working on even bigger deals from fancy perk-filled offices comes with the trade-off of long working hours. New Legal Cheek research provides un-paralleled insights into average start and finish times at top law firms across the UK.

As big legal players continue to fine-tune their flexible working polices in a bid to balance the needs of their clients and staff, our exclusive data shows a slight drop in the average hours clocked up by juniors this year compared to last year.

The reduction in time spent working ranges from several minutes for some lawyers to almost an hour for others. This could be down to a number of factors including firms making more of an effort to improve the work-life balance of their lawyers, and a cooling in client demand in some practice areas following a post-lockdown boom.

Perhaps unsurprising to most, the London offices of high-paying US powerhouses top the list of latest finish times. Kirkland & Ellis, the Chicago-headquartered outfit, landed the top spot on the list for a third year in a row, with average start and finish times at 9:19am and 11:11pm. Joining it in second and third spots, albeit by a fair distance, are US firms Ropes & Gray and Latham & Watkins, with finish times of 9:58pm and 9:13pm respectively.

Meanwhile, at the other end of the timings table, national players chalked up the shortest days. Personal injury giant Fletchers boasts the earliest average finish time at 5:14pm, with Express Solicitors in second place at 5:33pm. Rounding off the top three earlier finishers is Weightmans at 5:44pm.

So how does your firm fare? The full list of results, ranked from latest to earliest average finish times, can be found below. These timings will, of course, fluctuate according to which department juniors are working in, billing targets or the ebb and flow of a deal. Note also the start times which vary widely.

Legal Cheek Trainee and Junior Lawyer Survey 2022-23 — average start and finish times

As part of the survey, we also received hundreds of anonymous comments about working hours. Here are a selection of quotes from some Magic Circle and top US law firm trainees.

“My work/life balance fluctuates wildly being in a transactional seat. Some weeks I’ve been working in the taxi home at 2am, waking up in the morning and not having any time to shower or change before starting it all over again! However, some weeks I’ve had very little on so I’ve mainly worked on pro bono matters and administrative tasks, which are encouraged by the partners.”

“Post-Covid the WFH culture is also a lot more relaxed. It is very common to leave around 5:30-6pm, then log-on from home. Really nice if you have housemates/live with your partner.”

“Normally Saturdays and Sundays you are not expected to work — although normally one weekend of every month something comes up which requires a considerable number of hours at the week. Leaving the office pre-9pm in the week is a rarity.”

It’s not all work and no play, though. Some rookies mentioned the importance of boundaries and taking control of working habits.

“If you put down boundaries, they will be respected. As long as the relevant deadlines are met, no one minds if you leave the office at 3pm.”

“Hours can be anti-social, but if I have plans that I really want to do, on the whole I can do them if I flag it and work around it. My trainer even let me book a half day off with a couple of days’ notice so I could watch Hamilton. Weekends have been broadly uninterrupted.”

“There have been weeks where I have worked late hours but people seem to be very conscious of the need for people to pursue their hobbies and passions outside of work. I have been able to regularly go to the gym five times a week before work (with the exception of closing week on a deal when I was working past 2am every day) and have also been able to play football/go for drinks with friends/colleagues after work.”

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A glance at Legal Cheek’s recently released 2023 Firms Most List offers aspiring lawyers a range of different stats from trainee numbers and salaries to average leaving times and rookie retention rates.

It’s understandable that with over 80 firms on the list, your mind can be somewhat overwhelmed by all this information. But it’s also hard to grasp exactly what this means for you and how to properly understand these figures in context.

The most obvious trick is failing to put the trainee and newly qualified salaries into context with the average leaving times. It’s worth wiping away the tears after seeing the eye-watering sums and asking yourself how baggy-eyed will you be. All lawyers work hard. But make sure you are comfortable with the sort of ballpark you are going to put your work/life balance into. Another useful statistic in this area is the ‘most target hours’ criteria which will give you an indication of how many hours you will need to be doing billable work every year, if a firm imposes such a target.

Of course this all comes with the caveat that will be apparent when you read any one of the firm profiles, that everything depends on your seat, supervisor, the firm’s work culture and the reality that workloads come in peaks and troughs. In addition, the firms with the highest pay may not have the practice area you are interested in, the secondment opportunities you really want, or the most prestigious training in the market (though that last one you can decide for yourself). In short, the size of the salary isn’t everything.

Profit per equity partner (PEP) is always a tricky statistic to comprehend. The reason is that a key bit of information is missing: how many partners in a firm’s partnership are actually equity partners and how many are salaried. Freshfields, Linklaters, RPC, and Slaughter and May are all reported to have over 90% equity partners, meaning that these firms’ gross profits are shared amongst almost everyone with the title of partner. Other firms also have high proportions of equity partners. But it is striking that these firms are not the ones that score the highest on PEP.

These US firms are at the top of the charts for PEP precisely because they are very guarded about expanding their equity partnership. Operating a much more two-tiered partnership whereby there are a large number of salaried partners, often handing promotions to the rank of salaried partner earlier in your career should not cloud the reality. It is for this reason that using PEP figures to make claims about profitability can be deceptive — a better measure is revenue per lawyer.

Another point that is commonly overlooked is how a law firm is structured. Most will be Limited Liability Partnerships (with the notable exception of Slaughter and May which remains a general partnership). This means that, from a business structure perspective, the firm is very much one firm that shares profits and costs. So, the size of partners profits does not necessarily tell you straight away which firms are the most profitable and what you might earn and how long it might take you to become an equity will depend on how the firm structures its partnership.

However, there are some firms which have adopted a Swiss Verein structure. This model, which is used by large international organisations like Amnesty International and FIFA, enables various different business entities to all share branding but little else. Whilst management styles of Swiss Vereins vary, finances are kept completely separate between the various entities (companies, LLPs and so on) included in the structure.

This should matter to aspiring lawyers because it changes the meaning of the size of some law firms. Unsurprisingly, owing to the Swiss Verein’s flexibility, many of the law firms with the largest number of offices working in the most countries are Swiss Vereins. Baker McKenzie was one of the first firms to adopt this structure back in 2004, whilst other notable Swiss Vereins include Dentons, Norton Rose Fulbright and DLA Piper which saw them climb the various rankings and stand out to students because of their size.

But whilst you may think you are heading to a firm that does lots of international work, the fact that the offices are all separate may mean that there are barriers to referring work between the different entities. These firms certainly do lots of international work (you might even have the chance to jet off to some particularly exotic locations on secondment). But they are not always as much of a single firm as you might think.

This point brought sharply into perspective the collapse of King & Wood Mallesons’ European arm in 2017 with a former partner partly blaming the Swiss Verein structure for apparently fostering division in the firm, and this year’s $32.2 million malpractice verdict in the US against Dentons over a conflict of interest between Dentons’ US and Canadian branches. In short, you have to work a little harder to find out the extent to which a Swiss Verein is really ‘one firm’.

Take, for example, Hogan Lovells which adopted the Swiss Verein structure in 2010. A spokesperson for the firm earlier this year went public to say “we never found it necessary to use it”. They added: “It wasn’t needed for the combination [Hogan & Hartson merged with Lovells in 2010] and has always been dormant and does not cover any part of our operations either now or in the past”. The firm in reality operates like any other LLP and its partners from across its offices across the world all vote on management issues. Furthermore, it’s always worth checking which types of law are practised in these offices — some firms operate outposts in foreign countries that only practise English law.

These are three examples of why picking law firms by virtue of the fact that they top the charts on a particular metric can be dangerous. As we have seen, size in terms of pay, PEP and the number of offices and countries that a firm operates in all merit further scrutiny and an analytical eye. For this reason, comprehending these metrics is essential to understanding a law firm and ensuring that you can be as informed as possible when scrolling the Legal Cheek Most Lists and deciding where to start your legal journey.

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The recent spate of newly qualified (NQ) solicitor pay rises has given rise to so-called “salary bunching” at some UK law firms, whereby the difference in remuneration is rather negligible further up the associate ranks.

This was the key takeaway from an open thread we shared last month in an attempt to shed light on lawyer salaries beyond trainee and NQ level.

Sourcing this information is not easy (we’ve tried) and quickly goes out of date, so we passed the baton to our readers, many of whom work for UK law firms, to share their insider knowledge.

One UK-headquartered firm is said to be paying £95,000 at NQ level, £96,000 at 1PQE (post-qualified experience), £98,000 at 2PQE and £101,000 at 3PQE. “That bunching is abysmal”, wrote one anonymous commenter, with another saying it was the reason why they made a lateral move to a US firm, where the financial rewards are significantly higher and the hours, more or less the same.

“It’s so obviously all about the flashy NQ salaries to get people in the door,” said one Legal Cheek reader. “After that, who cares?”

Our readers do, clearly. The thread drew in over 250 comments and counting, and makes for insightful reading.

The pay structure at another UK firm is supposedly a little more generous and recorded in the thread as follows: £95,000 at NQ, £97,500 at 1PQE, £100,000 at 2PQE and circa £105,000 at 3PQE. At another firm paying out the same £95,000 NQ figure, they are said to be even higher: £98,000 at 1PQE, £101,000 at 2PQE and £106,000 at 3PQE. Having information as such could help training contract offer holders in their decision-making.

Our commenters have provided the lowdown on several other firms, including the magic and silver circle and those in the regions, but note that these figures are as of yet unverified.

Other interesting things the open thread highlighted:

• Associate pay can vary according to practice area, with those in busy transactional teams such as corporate or finance widely accepted to be at the higher end of salary bands but also, target hours.

• The salaries at some firms can be fixed for associates of about one to three years PQE, after which there’s banding and pay is determined based on performance, but this is by no means a hard and fast rule.

• Lateral hires being paid lower than home-grown talent and in one instance, a 3PQE lateral paid the same as a 1PQE associate.

• The varying bonus schemes in place at UK firms.

So where do we go from here? Perhaps we’ll see a UK law firm go on the record with a full breakdown of what they pay associates from NQ to at least 3PQE, leading the way for other firms to disclose their figures. But don’t hold your breath.

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The results of the first Solicitors Qualifying Exam (SQE) were released by the regulator last week, with just over half (53%) of the 1,090 candidates receiving the news they had passed.

The SQE is a step-change in how future solicitors are examined in England and Wales. It is too early to draw firm conclusions about its success or impact, but the preliminary statistics do, however, raise questions and potential concerns.

Legal Cheek‘s Aishah Hussain spoke to some of the key players in legal education and training to understand what the results mean for students and the wider profession.

Is the pass rate too low or just right?

Questions abound whether the 53% pass rate is too low or just right for the first ever SQE1 round.

Solicitors Regulation Authority (SRA) board chair Anna Bradley said the results suggest “it was a robust, fair and reliable exam” and while the full benefits of SQE are to be realised, “this is a good start”. The SRA’s outgoing education chief Julie Brannan echoed Bradley’s comments, emphasising to Legal Cheek that “this isn’t a numbers game, it’s a standards game”; the exam aims to objectively test candidates on whether they meet the standard of a ‘day one solicitor’.

“The standards were appropriate, fair and rigorously applied”, continued Brannan, who recently announced her retirement in June.

The pass marks of 57% for FLK1 and 56% for FLK2 were set using a Modified-Angoff method involving a panel of qualified solicitors who considered each question and estimated the proportion of newly qualified solicitors that would answer them correctly. Employing ‘standard setting’ rather than a fixed pass mark is widely accepted as a valid approach in professional exams, such as the Bar Standards Board (BSB) centrally-set assessments in civil and criminal litigation, but carries a risk of introducing subjectivity into the process as the pass mark depends on the perceived level of difficulty of the assessment.

There were mixed reactions among academics at the various SQE training providers.

Professor Peter Hungerford-Welch, associate dean in postgraduate and professional programmes at The City Law School, said the headline pass rate is “disappointing”. Expanding further, he said this could be a consequence of the volume of material assessed in the two SQE1 exams (FLK1 and FLK2) which combine knowledge formerly required in the qualifying law degree with knowledge from the compulsory practice areas on the Legal Practice Course.

Lucie Allen, who recently assumed the role of managing director at BARBRI, also found the overall pass mark to be “a little low” but said that isn’t surprising given the major shift that candidates experienced. “The exams covered 16 different subject areas and 360 multiple choice questions — it’s challenging, to say the least,” Allen told Legal Cheek. “However, the results do indicate that candidates can and will thrive with the right preparation and support,” she said, adding: “We are tracking at a 79% pass rate which is significantly higher than the overall SQE1 average.”

Of note is the difference in pass mark between the two functioning legal knowledge tests. A higher proportion of candidates passed FLK1 (67%) than they did FLK2 (54%). On the difference, SQE independent reviewer Geoff Coombe said: “It is possible that as candidates take FLK2 just three days after FLK1 they were becoming fatigued and/or had less time to prepare as well for FLK2.” He suggested the SRA monitor the difference and see if it may be worth considering spacing the exams further apart.

All things considered, the 53% pass rate shows that the SQE is not an easy set of assessments to pass, according to BPP University Law School dean Jo-Anne Pugh. “As well as the sheer breadth of knowledge covered in the assessment, the pass marks of 57% for FLK1 and 56% for FLK2 will be a shift for many learners, most of whom will be used to a pass mark of 50% in their earlier studies and many of whom will not have been previously assessed at the level of a day one newly qualified solicitor,” said Pugh.

Dr Giles Proctor, chief executive officer of The College of Legal Practice, was of the view that the results were “broadly in line” with expectations for the first exam. He said, however, that “we expect to see this increase slightly over time as the make-up and the size of the cohort changes and increases”.

An ‘atypical’ cohort

We do not know how representative this first cohort of SQE candidates has been compared to what it will be in future years. The SRA reports those who took the November 2021 assessment were mostly paralegals, apprentices and overseas lawyers. A quarter (25%) of exam-takers said they were already qualified lawyers (either an overseas lawyer or a barrister), while over three-quarters (76%) had already accumulated two years of ‘qualifying work experience’. It may take a while for a “typical” student cohort to become discernible, said Hungerford-Welch, and the results of students undertaking the SQE as part of an LLB or training contract, for example, to feed through. Moreover, only 27 solicitor apprentices were part of this first sitting, and we can expect this figure to increase in future cohorts.

The SRA will also be able to better contextualise Friday’s results after further SQE1 sittings. “It’s very early days, and we’re still in the transitional phase,” Brannan told Leal Cheek. “We had just over 1,000 candidates for the first sitting and we can expect around 10,000 in the future — the results represent a tenth of the ultimate expected cohort.”

A more accessible solicitor profession?

One of the founding aims of the SQE was to make the solicitor profession more accessible. Yet, with just 53% making the grade, will it set out to achieve this aim?

Allen and Proctor were of the view that the flexibility offered by the SQE and particularly the change in requirements for training to qualifying work experience from the training contract, will increase access to the profession in the long term.

Hungerford-Welch, however, thinks there is still work to be done. Referring to the SRA’s statistical report, released alongside the results, he said: “A possible explanation for the difference is prior educational disadvantage but the statistics, which use a common ‘proxy’ for socio-economic background (namely, whether either or both parents attended university) suggest that this is not a major factor (the pass rate was 58% for candidates with one or both parents having attended university as against 51% for candidates where neither parent attended university).” However, he noted, “Access to work experience (often a function of ‘social capital’) shows a pass rate of 57% for those who have undertaken some qualifying work experience as against 43% for those who had not.”

Of greatest concern is the breakdown of results according to ethnic group, he continued. The SRA identified an “attainment gap” among ethnic groups: some 65% of white candidates passed SQE1, compared to 43% Asian and 39% Black candidates based on a 40% disclosure rate. The regulator said it has a range of measures in place to ensure the SQE is “free from bias” and last month drafted in Exeter University to look at what causes different levels of attainment for ethnic groups in professional assessments. The results are expected towards the end of 2023 or early 2024.

“Whilst the SQE is not alone in having significant differences in pass rates, there is a need for research into the reason for this difference in the context of the SQE and for consideration of strategies for remedying the disparity,” said Hungerford-Welch. “This is something where the SRA could usefully work with the BSB (whose centrally-set assessments also take the form of multiple choice/single best answer questions).”

All in all, last Friday was a “landmark day in legal education”, said Peter Crisp, deputy vice chancellor of The University of Law. Candidates will now have to consider whether they progress onto SQE2, for which bookings open on 31 January and close on 7 March 2022. If they failed the first stage of the assessment, they have the opportunity to re-sit the exam with the next cohort of aspiring solicitors in July 2022.

Planning to sit the SQE but unsure what your funding options are? Legal Cheek is partnering with BPP University Law School for a virtual student event tomorrow (Thursday 27 January) exploring the different funding options on offer. Apply for one of the final few (and free) places to attend.

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A year ago Legal Cheek purchased £600 worth of shares in six UK law firms listed on the stock market.

Twelve months on and the value of that investment has risen to £756.83, a 26% increase. This is almost double the increase in value of the FTSE 100 in the same period.

Here is what we bought in early January 2020:

DWF Group PLC: £91.02 fund value (83.50p per share)
Knights Group Holdings PLC: £84.64 fund value (368p per share)
The Ince Group: £88.05 fund value (46p per share)
Keystone Law Group PLC: £86.70 fund value (510p per share)
Gateley Holdings PLC: £90.72 fund value (144p per share)
Rosenblatt Group Holdings PLC: £91.77 fund value (57.00p per share)
Total fund value: £532.90 (£67.40 was spent in commission purchasing the shares)

And here is what those shares are worth today:

DWF Group: £124.26 fund value (114p per share)
Knights Group Holdings: £94.30 fund value (410p per share)
The Ince Group: £63 fund value (33p per share)
Keystone Law Group: £142.80 (840p per share)
Gateley Holdings: £144.90 (230p per share)
Rosenblatt Group Holdings: £187.57 (116.50p per share)
Total fund value: £756.83

The best performer has been Rosenblatt, chalking up a whopping 104% rise, followed by Keystone (up 65%) and Gateley (up 60%). The worst was Ince, which fell by 28%.

Law firms are allowed to list on the stock market as a result of the Legal Services Act 2007, which removed the rule preventing non-lawyers from owning law firms. Since the Act was implemented in 2010 a host of firms have gone public, the first being Gateley in 2015.

There continues to be considerable momentum in this area, with Irwin Mitchell and Mishcon de Reya both reported to be exploring potential initial public offerings (IPOs) that could take place this year.

Lawyers from Gateley spoke at last month’s Legal Cheek Winter Virtual Vacation Scheme about what it was like to work for a listed law firm.

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The history of the trademark has been primarily centred around identification. Marks were frequently used to indicate the origins of a product and its compliance with certain standards of quality

Accordingly, the rationale behind the 1374 ordinance of Amiens, requiring each blacksmith to use a unique mark on their work, was “so that […] it may be known who made it”, whilst the 1425 mandatory crossbow marking legislation in Lübeck was intended to prove the maker “had done and will do his work within the proper manner”. And infringement was not a laughing matter, with one striking example being the hanging of a 14th-century wine fraudster for ripping off Rüdesheimer, the highest quality wine of its day.

In his 1927 work, The Rational Basis of Trademark Protection, Frank Schechter explained this rationale rather poetically in a more modern context: “through his trademark the manufacturer or importer may ‘reach over the shoulder of the retailer’ and across the latter’s counter straight to the consumer”. However, as trademarks have become increasingly wound in the complex world of cunning marketing and visual arts, trademark law has been forced to reconcile its original identifying rationale with new meanings.

The notion of brands attempting to trademark colours is an interesting example of this. Such an act was first fully realised in the US until the landmark 1985 case of Owens-Corning Fibreglass Corp, where the court held that “if a mark is capable of being or becoming distinctive of applicant’s goods in commerce, then it is capable of serving as a trademark”. Today, the threshold that must be past by applicants is that the use of colour inherently identifies a particular source or has acquired a secondary meaning. The colour also cannot be functional — you can’t trademark traffic lights’ colours.

Elsewhere, the EU did not allow colours to be registered as trademarks until the 1990s. EU trademarks must be “capable of distinguishing the goods or services of one undertaking from those of other undertakings”, with case law on trademarking colours per se turning on distinctiveness.

All this is trademark law’s attempt to be heroic brand protectors. The result in the case of colour marks has been crude artistic oversimplification and an ironic resulting confusion.

In 2008, Louboutin’s famous red soles successfully met the US threshold and were granted a trademark by the US Patent and Trademark Office. Louboutin has since successfully defended its rights against under challenge from Yves Saint Laurent, confirming that the red sole has a “secondary meaning as a distinctive symbol that identifies the Louboutin brand”. In 2018, the Court of Justice of the European Union also upheld the colour mark.

The US judgment summed up the rationale as follows:

“We see no reason why a single-color mark in the specific context of the fashion industry could not acquire secondary meaning―and therefore serve as a brand or source identifier―if it is used so consistently and prominently by a particular designer that it becomes a symbol, ‘the primary significance’ of which is ‘to identify the source of the product rather than the product itself’”.

Yet the arguments from both Yves Saint Laurent and Christian Louboutin seem to explicitly undermine this logic of a secondary meaning by revealing that the true dark art of colour marketing lies in drawing on pre-existing meanings. Louboutin claimed the red sole was selected to give the high heels “energy, because [red] is engaging, red is sexy and attracts men to the women who wear my shoes”. Meanwhile, Yves Saint Laurent claimed the focus of its red was entirely different. It aimed to “evoke Chinese design elements”. This underlines the diverse pre-existing meanings that underpin marketing communication through colour. Even for Loubtoutin, red soles do not mean Louboutin, but a variety of associations to the colour red in the setting of a high heel.

Furthermore, colour marks have ironically created fertile ground for an increasingly confused trademark counterculture. Consider, for example, the artist Stuart Semple’s claim to be liberating Tiffany Blue by selling his recreated version ‘TIFF BLUE, SUPER MATTE ACRYLIC’ seem somewhat non-legalistic. Whilst Tiffany does have trademark rights for “a shade of blue often referred to as Robin’s Egg Blue which is used on boxes”, this is only in connection to the sale of certain products.

So, it appears that Semple is making the most of the public’s vague awareness of the true workings of colour trademark law. As a side note, if Semple is really worried about people owning colours, he should look to patents and trade secrets rather than trademarks (examples include Yves Klein’s patented International Klein Blue and ‘Prussian Blue’, the formula for which was kept secret for around a quarter of a century until published in 1724).

Ultimately, colour marks seem to be deceiving. It is time they were reconsidered with greater appreciation of the dark arts of branding and precision towards the complexities of product aesthetics as trademark law returns to its original true colours: identification.

Will Holmes is a future trainee solicitor at a magic circle law firm.

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For those with a record of questionable data practices, yesterday’s judgment handed down by the UK Supreme Court will have come as a massive relief. And if you’re TikTok, who discovered in April that it was to face a possible collective action led by the former children’s commissioner for England Anne Longfield, you might have even burst out into song and dance.

The ruling concerned allegations that Google had breached its duties as a data controller under the Data Protection Act (DPA)1998. In late 2011 and early 2012 Google allegedly tracked millions of iPhone users’ online activity without their knowledge or consent using the now infamous “Safari workaround”. With the backing of a large litigation funder, Robert Lloyd sought to lead a representative claim on behalf of the millions of affected iPhone users.

There are two distinct elements of this ruling that are particularly significant. First, can a representative claim be brough under Rule 19.6 of the Civil Procedure Rules?

The UKSC found that it could see “no legitimate objection to a representative claim” [84]. In the context of data breach claims, which by its nature affects large numbers of people, this makes sense.

The court diagnosed the problem like this:

“As the present case illustrates, the development of digital technologies has added to the potential for mass harm for which legal redress may be sought. In such cases it is necessary to reconcile, on the one hand, the inconvenience or complete impracticality of litigating multiple individual claims with, on the other hand, the inconvenience or complete impracticality of making every prospective claimant (or defendant) a party to a single claim.”

So, surely a representative claim is a good solution? Well, the UKSC found that a representative claim was not adequate due to its inability to follow the compensatory logic of damages. Lloyd’s claim was for damages to be awarded in a uniform manner (each claimant gets the same). Under common law, damages are intended to put an individual in the same position they were in before the loss occurred. This is difficult to do for mass claims because people can be affected in different ways (with more frequent users being vulnerable to more breaches and the data being used in different ways by Google in this case). Therefore, the fact that representative claims do not allow for an individualised assessment of the claimants and that “the effect of the Safari workaround was obviously not uniform across the represented class” made them unsuitable for Lloyd’s claim.

The second key question was: can compensation be claimed under section 13 DPA 1998 for a possible breach by Google of its duties as a data controller? Lloyd was claiming that ‘loss of control’ over personal data amounted to a breach. Section 13 recognises two breaches: material damage and distress (as was established in Vidal-Hall v Google [2015]). The UKSC’s interpretation found that ‘loss of control’ is “not an expression used in the DPA 1998” nor are any of the requirements of the act “predicated on “control” over personal data by the data subject”.

So if your gut reaction to my initial summary of Google’s non-consensual data tracking activities was ‘so what’, then you were on the right lines. Furthermore, the court found that the threshold for seriousness which “must be crossed” for compensation to be awarded fell short of the mark.

This all bodes well for data controllers such as TikTok facing claims centred around ‘loss of control’. But they are not out of the woods yet.

The UKSC did left open the possibility of a bifurcated approach whereby common issues of law or fact are decided through a representative claim but damages are determined later via a process of individualised assessment. In addition, the ruling suggests that a more fruitful path for claimants may be going down the misuse of private information path which “naturally lend[s] itself to an award of user damages” (a remedy available where harm cannot be quantified in the normal way). One final distinction is that this was decided under the DPA 1998, whereas TikTok’s case would be considered against the Data Protection Act 2018.

Despite this, the ruling means that any representative claims will fail by virtue of the differences in possible damages between claimants. It leaves it up to users to challenge large and powerful data controllers on their own. Today’s ruling passes the baton to parliament. Whether this imbalance will be addressed, as it has been in competition law by the Consumer Rights Act, remains up to government who in early 2021 rejected such proposals.

Will Holmes is a future trainee solicitor at a magic circle law firm.

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In December 1803, rumours were running rife in London that a ghost was at large in Hammersmith. After 1am, this phantom was said to frequent some fields next to Black Lion Lane, attacking travellers and terrorising villagers. On 3 January 1804, one villager called Francis Smith took matters into his own hands and decided to patrol Black Lion Lane armed with a gun.

That same dark evening, the bricklayer Thomas Milwood had headed out dressed in his brand new white work clothes and shoes that were standard for his trade. Milwood had already been mistaken for the mysterious ghost twice before when wearing his new work uniform. So, as Milwood headed down the poorly lit Black Lion Lane, it was perhaps no surprise that a terrified Smith thought he had found the ghost. Having called to the ghost twice to no avail, Smith became increasing anxious at the undeterred approaching phantom. So, he pulled out his gun and shot Milwood dead.

Smith openly admitted he had killed Milwood but pleaded guilty of manslaughter (rather than murder) on the grounds that at the time he genuinely believed he had shot a ghost. The jury agreed, but the judge remained unconvinced, pointing to the absurdity of Smith’s belief in ghosts. Accordingly, the jury were instructed to either acquit Smith or find him guilty of murder. They found in favour of the latter and Smith was sentenced to death (although significant public sympathy later saw his sentence reduced to one year’s imprisonment thanks to a Royal pardon).

As well as being a cautionary tale for those with very convincing Halloween costumes, the Hammersmith Ghost murder case is legally significant for two reasons. First, it highlighted the absence of a defence for those who in good faith mistakenly believed their acts were necessary — an issue that was only resolved in R v Williams [1983]. Second, it affirmed as that, in the eyes of English law, ghosts don’t exist.

This was confirmed in Lyon v Home [1868] where Mrs Lyon, a spiritualist (someone who believes that the dead can communicate with the living) widow who was convinced by the ‘spirit medium’ (a practitioner who can relay messages from the dead) Mr Home that her dead husband wanted her to gift Home around £3 million in today’s money. The court extended the principle that the relationship between spiritualist and medium was akin to that of doctor-patient or client-solicitor — there was an irrebuttable presumption that one party has influence over the other. Therefore, they found the transactions void on grounds of undue influence. Underpinning this, was the idea that ghosts were “nonsense” and therefore not of legal significance to the case.

Other jurisdictions, however, have not been so certain about denying the existence of ghosts. As we can see in the two aforementioned cases, this is likely to come with legal complications and unforeseen consequences.

Canadian courts have been far less clear on whether the law accepts ghosts exist. In Manitoba Free Press Co. v Nagy [1907], Mrs Nagy sued a newspaper for publishing a report claiming that her property was haunted. As Michael Shortt points out in his excellent review of ghost law in the US and Canada, her argument centred on the contention that ghosts do not exist. Despite the Manitoba Court of Appeal’s explicit agreement with Nagy’s argument (“the Court may … assume that there are not such things as ghosts and that therefore the statement is necessarily false”), the Supreme Court of Canada was far more ambiguous.

It held that “the evidence only admits of one conclusion and that is that the article complained of was false”, offering two possible interpretations. Either ghosts simply do not exist and therefore the report is false. Or, more narrowly, Nagy’s house specifically was not haunted, leaving open the possibility that ghosts could exist in Canadian law.

I wonder how this might have affected a case like 1784773 Ontario Inc. v K-W Labour Association et al [2013]. After selling a house, the seller jokingly made public comments that the house was haunted. A claim was brought by the buyer of the house for failure to disclose that the property was “haunted” during negotiations. This, however, was struck out as there was no evidence (such as unexplained noises etc) behind the seller’s claims. However, if there had been some evidence of paranormal activity, the ambiguity in Manitoba Free Press Co. v Nagy has not definitively closed the route for a claim for failure to disclose the house’s “haunted” quality.

The US position is yet more confused as Shortt and Blewett Lee highlight. In Cooper v Livingston [1883], the Florida Supreme Court ruled that a promise to cure an illness by conjuring spirits was not deemed sufficient consideration. Surely that’s because the Court thought ghosts don’t exist and therefore, in this case, nothing had been promised, you might be thinking. In fact, the claim was decided on illegality owing to the contention that any spirits conjured would be Satanic, thereby violating blasphemy laws.

Furthermore, in McClary v Stull [1895] the children of a spiritualist widow asked Nebraska Supreme Court to invalidate changes made by their mother to her will allegedly on their dead father’s orders. Surely, as in Lyon v Home, undue influence could only be found in the relationship between spiritualist and medium? However, the court invalidated the changes on the grounds that the dead husband had exerted undue influence over his wife.

In a remarkable judgment, the court explained:

“Law, it is said, is “of the earth, earthy” and that spirit-wills are too celestial for cognizance by earthly tribunals — a proposition readily conceded; and yet the courts have not assumed to deny to spirits of the departed the privilege of holding communion with those of their friends who are still in the flesh so long as they do not interfere with vested rights or by the means of undue influence seek to prejudice the interests of persons still within our jurisdiction.”

This uncertainty surrounding the existence of ghosts can ultimately lead to some legal horror stories.

This is highlighted by two cases concerning representations in relation to ghosts. In Nurse v State [1910], Jim Nurse claimed that spirits had informed him that there was a large amount of money buried under an individual’s property. Some money was found and then reburied on Nurse’s advice with the caveat now being that if the money was now handled the spirits would “vanish it all”. The case was brought on grounds of fraud. Similarly, in Burchill v Hermsmeyer [1919], Mrs Burchill had claimed that ghosts had told her there was oil under her land. Mr Hermsmeyer invested a large amount of money to find no oil and sued for fraud.

Although the argument that both these ghostly misrepresentations amount to fraud appears to be the most obvious route to a successful claim, both cases were turned on ghostly misrepresentation. The logic was that a misrepresentation, which is concerned with facts, cannot be made on the subject of ghosts as their existence is uncertain and a matter of belief. As the court reasoned in Burchill: “spiritual communications […] are too unsubstantial a character to be received as representations of fact […] therefore the representations of the defendants must […] be regarded as insufficient to form a basis for relief to the plaintiff”. For this reason, both claims failed and the fraudsters got away with it.

Although the question of whether you deny ghosts exist or not might at first seem immaterial, it is clear that such differences can lead to eery legal decisions. The courts inability to be ghostbusters has developed a curiously haunted jurisprudence. Indeed, as long as they remain elusive, it appears that lawyers on occasion may be called to confront ghosts or even defend their cause.

Will Holmes is a future trainee solicitor at a magic circle law firm.

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Junior lawyers at some US law firms in London are averaging 14-hour workdays, exclusive Legal Cheek research has shown.

The data, derived from our annual survey of over 2,500 trainees and junior associates at law firms in London and the UK, shows that lawyers in the City hubs of some US law firms are grinding it out far longer each day compared to their peers at magic circle and other UK-headquartered firms — with the shift to remote-working only serving to ramp up their working hours.

Kirkland & Ellis rookies reported the longest hours of any law firm in the country for the third year running. They start work on average at 9:14am and finish close to midnight at around 11:28pm. That’s over two hours later than those working at most magic circle firms, and a notable uptick on the average hours recorded by Kirkland in last year’s survey (9:28am to 9:46pm), when rookies had spent most of the year in the office before the pandemic hit.

Juniors at other US firms in London also report late finish times, as can be seen in the below table. Those working at Ropes & Gray and Weil finish work well past 10pm, according to our figures, whilst juniors at Latham & Watkins, Goodwin Procter, White & Case, Cleary Gottlieb and Paul Hastings clock off on average after 9pm each day.

Legal Cheek Trainee and Junior Lawyer Survey 2021-22 — average start work and finish times

The full hours data across the 100 surveyed law firms will be published later this week

Lawyers across the City experienced an increase in work as a result of the pandemic, particularly in private equity, which is a major practice area for elite US outfits and has contributed to this year’s record-breaking financial results.

For example, the PE boom reportedly saw Kirkland’s global revenue edge towards $5 billion (£3.6 billion) and partner profits reach an eye-watering $6.2 million (£4.5 million).

Responding to our survey, which was carried out at the start of this year, around the time of the third national lockdown, one junior lawyer at a US firm said, “the hours are long and Covid-19 has made this especially worse with the post-pandemic boom creating huge deal flows and competing client expectations”. They added:

“Work from home has created a ‘work/life blur, rather than balance'”.

This sentiment was reflected by other junior lawyer respondents.

“[My] work/life balance has been totally eroded by Covid-19 and working from home,” pitched in another trainee. “Pre-covid, while there were of course busy periods, I would generally log off and leave the office between 7-9pm, and weekend working was a rarity. Now, finishing work before midnight is unheard of during the week, and weekend working is a regular occurrence.”

“WFH [work from home] life has also meant that with nothing else in our diaries, the default thing to do has just been to work and there’s been no shortage of work to fill up the time,” another trainee added.

A red hot market coupled with no business travel or commute to the office to break up the work day and little oversight from seniors as to when they clock off, left juniors feeling “like we’re on the clock 24/7”, although it was acknowledged that “the flow of deals often means you will have downtime in between heavy spats of work.”

The findings can also partly be explained by the fact that New York (where these firms are usually headquartered) is five hours behind London and often require support later in the day from UK colleagues.

There have been a wave of junior lawyer pay rises reported on over the past year, with newly qualified (NQ) salaries at US law firms in London toppling over £150k. There have also been reports of firms awarding Covid and other discretionary performance bonuses “to keep us sweet”, in the words of one trainee.

The billing targets at US firms tend to be higher than at others, as shown in our 2022 Firms Most List. And we’re told if rookies at one firm were considered to be “under capacity” in terms of billing targets, that they’d get “ripped into corporate M&A deals”, regardless of what seat they were in. In another instance, one trainee said they billed “400+ hours in a month”.

A full breakdown containing 100 UK law firms’ average start work and finish times will be published later this week.

Struggling with the stress of work? Contact LawCare via its helpline or live chat

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In the latest instalment of a mini-series that provides a historical perspective to the legal quandaries of the present, future magic circle trainee Will Holmes takes a look at how lawyers have responded to technological innovations and questions whether the industry is ready for legal tech disruption.

For the German monk Johannes Trithemius, a world without scribes “would see faith weakened, love grown cold, hope confounded, justice lost, the law confused and the Gospel fallen into oblivion”.

The arguments against the printing press put forward in Trithemius’ 1492 work In Praise of Scribes were frequently voiced by lawyers in the fifteenth and sixteenth centuries. At that point, it certainly didn’t look like the technological innovation of printing was going to have any immediate impact on the legal sector. Judges claimed “the [printed] books are against the law” and focused their criticisms on the system’s technical imperfections, complaining that misprints “many times confound the students!”.

Today, there is a similar sense of pessimism surrounding legal tech. The stories of the “revolutionary law firm” Clearspire and Silicon Valley-backed Atrium have demonstrated that it takes more than millions and big tech personalities to disrupt the legal sector. But whilst the lasting impact of modern technology on the legal sector still remains to be seen (and historical attempts to figure out why it happened are even further away), we do have the experience of the printing press, the invention that is perhaps yet to be dethroned from its title of being the most significant innovation in legal history.

Despite Trithemius’ claims, in the seventeenth century printing did eventually displace the slower and less accurate manuscript culture in the legal profession. Judges, who had earlier criticised it so fervently, later acknowledged that the innovation was now “the true and most sure register of the foundations and principles of our law”. But why did it take nearly 150 years since Caxton first brought over the first printing press to Westminster for print to become prevalent in English legal culture?

The slow proliferation of print can be attributed to a number of factors. First, the predominantly oral legal education established by the Inns of Court meant that it took some time for lawyers to fully realise the benefits of print. Second, the legal profession’s use of the French language, that was rare outside this context, meant that French legal texts had a limited audience and were less lucrative for entrepreneurial printers. As written education and English became more established in the legal profession, the scene was set for print to make its mark.

There was just one problem: the lawyers themselves. At the time, a lawyer’s value was his knowledge of the law rather than its application. As the sixteenth-century printer-lawyer John Rastell remarked, the law was “kept so secretly” that it functioned as “a trap and a net to bring the people to vexation and trouble”. Manuscript culture had served lawyers well in this regard. The Inns of Court exclusively controlled the circulation of manuscripts, centralising legal knowledge amongst a few practitioners who profited from its scarcity. It is only thanks to profit-seeking legal clerks, who spotted the opportunity to surreptitiously sell legal manuscripts to printers, that printing was able to escape from the lawyers’ stranglehold.

The steady leak of legal information reshaped the legal industry, democratising legal knowledge for the first time. This ultimately redefined the role of the lawyer, recentring the profession on interpreting the law for individuals who now had a better sense of their legal standing. This is particularly true for commercial law. Indeed, evidence suggests that areas of England with sizeable mercantile communities, rather than locations populated with lawyers, were the biggest buyers of legal texts.

An interesting reflection on the printing press comes from the lawyer-turned-priest John Donne. From his time in Lincoln’s Inn between 1616 and 1621, he came to this insightful conclusion: “it is an unjust thing in Controversies and Disputations, to press arguments out of Manuscripts, that cannot be seen by every man”. In other words, the common law had to be commonly accessible. Donne lamented that ideas about the importance of accessibility, which dated back to Thomist arguments made to lawyers perplexed by the growth of legal precedent in the twelfth century, had been neglected for centuries.

Just as the legal profession failed to pragmatically debate the effects of the printing press on justice, today, law’s traditions are deterring people from bringing cases. The Competition and Markets Authority’s (CMA) 2016 report revealed that around 70% of potential legal needs are unmet in the UK. Amongst the underlying reasons for this are concerns about “high and uncertain costs”. The uncertain price problem stems from the traditional billable hour system that is used by the majority of legal service providers. The longer a case lasts, the greater a lawyers’ earnings. This ironically, as the former magic circle lawyer Jim Diamond points out, incentivises the very inefficiencies that are damaging access to justice. Furthermore, the perceived “complexity and associated fear” of bringing a case was also cited by the CMA as a key factor in the high rate of unmet legal needs. Again, this favours lawyers whose expertise allows them to profit off a non-user-friendly judicial process.

In light of this, it is perhaps unsurprising that there is much talk of a “lawyer killer”. Projects, such as Kleros, Jur and Aragon can now resolve large volumes of small claims disputes that have been caused by the advent of the internet. In the UK, more affordable chatbot lawyers, such as DoNotPay, LawBot and LISA, have marked an improvement in the accessibility of certain legal services. Robot judges in Estonia and China’s Internet Courts are other headline-grabbing responses. Still yet to be proven is the prospect of decentralised governance in law firms which could create purpose-driven law firms out of nowhere. Lawyers across the globe could pool their resources and fill gaps in legal work that are being missed by the market.

In law, the buck always stops with the client. If technology can change their relationship with the law and legal services, then legal tech — in whatever shape or form — has arrived.

The post What lawyers’ response to the printing press tells us about the future of legal tech appeared first on Legal Cheek.

It’s the half-way point for the Legal Cheek listed law firm fund, a basket of legal shares that I invested in back in January with monthly progress reports until the end of the year. And so far so good.

The £600 I put into the fund at the beginning of 2021 is now worth £829.65, an increase of 38%. By way of comparison with the major indexes, the FTSE 100 is up 7% in that period and the S&P 500 16%.

So it seems that, so far, some of the early doubters, who strongly questioned the wisdom of investing in law firms after the value of the fund initially dipped as low as £532.90 in its first few weeks, have been proven wrong.

Who have been the biggest risers?

Well, one is way ahead of the others: Rosenblatt Group Holdings. The law firm founded by solicitor Ian Rosenblatt and now run by Nicky Foulston, previously a successful motorsports boss, is now worth 139% more than when I invested in it in January. Market watchers expect further rises for the firm, whose turnover is forecast to hit £46 million this year following its recent acquisition of Memery Crystal.

The next biggest riser is Gateley, whose share price is up 37% since early January, followed by The Ince Group, up 26%. Then there is Keystone Law, up 22% and DWF, up 20%. Only Knights Group Holdings has fallen, by 2%.

So what happens next? With the corporate legal market already busy, and a strengthening recovery expected during the second half of the year, there’s no sign that listed law firms’ bull run is set to end yet. Indeed, with US newlaw giant LegalZoom going public earlier this week — and immediately enjoying a 35% increase in value — and other big firms like Mishcon de Reya and Irwin Mitchell reported to be considering their own IPOs, listed law firms seem to have momentum.

Also expect investors to be watching the traditional legal sector closely as financial results season for unlisted partnership law firms gets underway this month. Murmurs suggest we could be in for some strong figures, particularly in respect of profit per equity partner, which may surge at many firms amid a plunge in business costs resulting from international travel restrictions and working from home. Rosy results could buoy market sentiment enough to further lift listed law firm share prices.

The Legal Cheek listed law firm fund

DWF Group: £118.81 fund value (109p per share)
Knights Group Holdings: £96.14 fund value (418p per share)
The Ince Group: £126 fund value (66p per share)
Keystone Law Group: £115.60 (680p per share)
Gateley Holdings: £134.82 (214p per share)
Rosenblatt Group Holdings: £238.28 (148p per share)
Total fund value: £829.65 (up from an original total of £600 invested in January this year)

This series is in no way intended to amount to financial and/or investment advice.

The post Legal Cheek listed law firm fund chalks up 38% increase in just six months appeared first on Legal Cheek.

In the first installment of a new mini-series that provides a historical perspective to the legal quandaries of the present, future magic circle trainee Will Holmes takes a look at lawyers’ relationship with money throughout history and asks whether we should be worried about the latest Big Law salary war.

The lawyer and senator Publius Suilius Rufus was notorious throughout the Roman Empire for his recklessness, avarice and corruption. The Wolf of Wall Street of his day, Suilius delighted in extorting payment from his clients. He was known for charging huge retainer fees of around 400,000 sestertii and often later betrayed his client, unprofessionally selling out to adverse party if the money was right. Deemed a sign of the legal profession’s moral decay, Suilius was shamefully exiled from the Empire under Nero’s reign.

But, in light of the recent salary hikes across the City, Suilius’s money-grabbing mentality might no longer be considered so scandalous or even noteworthy today. The latest wave of the City law pay war is set to leave junior lawyers’ eyes bulging with dollar signs and future wannabe lawyers keenly rifling through salary lists more than ever before. After Millbank‘s announcement at the beginning of June, US firms have revised London newly qualified (NQ) pay to north of $200,000 (£144,000) and their magic circle competitors are also splashing the cash.

Money and law have always had a complicated relationship. In a formalised system, where legal education is time-consuming and costly and the work is laborious, it is entirely reasonable that lawyers are well remunerated. Indeed, this is exactly the response that Suilius gave to Emperor Claudius when his reputation caught up with him in 47 AD. Indeed, Suilius went even further, brazenly asserting that a lawyer had as much a right to all the compensation he could possibly obtain just like a Roman soldier had to booty and plunder when victorious on the battlefield.

But Suilius was far from blind to the counterargument. News of his corrupt behaviour had led the Senate to debate lex Cincia (204 BC), the presiding regulation of legal payment, in the presence of Emperor Claudius. This law officially outlawed payment for legal services, but it was famously ineffective. By 200 BC, legal fees had become common practice and if scrutiny ever emerged to trouble lawyers, loopholes such as expensive gifts and donations were used to circumvent the regulation.

On realising that the debate looked likely to result in the abolition of lex Cincia and the system that had so benefitted him, Suilius suddenly U-turned on his position. He waxed lyrical about the role of the lawyer in society, citing examples of famous morally praiseworthy lawyers whose work was motivated by public service, a sense of duty to the empire and honour. Losing sight of this moralistic culture in the legal profession would be disastrous for justice.

Many practitioners rallied against Suilius’s argument that implied Rome should return to the days when lawyers typically worked for free. Ultimately, Claudius opted for a compromise: lawyer’s fees were to be capped at 10,000 sestertii. Surprisingly, this remained a prevalent threshold in the minds of Roman lawyers for the next 250 years, although it was at times disregarded.

What Claudius’s decision demonstrates is the importance of questioning our legal culture. It is clear that overly money-centred legal culture is neither functional nor desirable. But it is also clear that lawyers should not work for nothing, especially with the demands of the profession and the pricy educational barriers to entry.

Should we be worried? We have come a long way from the medieval communal culture that first bound England’s four inns of court. And there are signs of the frailty of our current system. As John Morley points out, the collapse of Dewey & LeBoeuf in 2012 revealed the “deep connection between partner ownership and the values of friendship, loyalty, and trust”. As the former Chair of Dewey realised, “if it is only money that holds a firm and its partners together, then there is really no glue at all”.

The Big Law pay war still rages today. But, as Emperor Claudius discovered, we must watch carefully to see if this deteriorates our legal culture or beneficially makes it more attractive.

Will Holmes is a future magic circle trainee.

The post What Emperor Claudius would have thought about the City law pay war appeared first on Legal Cheek.

New data published by the Office for Students reveals the percentage of recent undergraduates who went on to secure a “positive outcome” 15 months after graduation. The data was collected via the Graduate Outcomes survey.

The following count as a “positive outcome”:

● Working in a professional role (pupil barristers, trainee solicitors, paralegals and legal executives are all deemed to be occupying “professional” roles)
● Studying
● Travelling
● Caring for someone
● Being retired

According to the regulator, 73.9% of law students who graduated in 2018 had a positive outcome 15 months down the line. Law graduates performed similarly to geography (75.0%), languages (73.2%) and politics graduates (73.1%). The worst-performing subject areas were media studies (67.4%), psychology (63.6%) and sociology (60.8%).

The relevant data is also split out by subject and university. For law graduates, household names can be found on both ends of the positive outcome ranking. On the one hand, Oxford (91.8%), LSE (91.8%), Durham (89.8%), Cambridge (87.3%) and King’s College London (87.3%) enjoy high positive outcome rates. City University (64.8%), The University of Law (66.4%) and BPP (70.8%), which has since discontinued its LLB, scored lower. The full list can be found here.

The report also measures the percentage of students who, having begun their course in 2018, were expected to progress onto their second year of university but did not do so. By combining this with the data on positive outcomes, the Office for Students has come up with an approximation of the percentage of students that will both complete their degree and have a positive outcome 15 months after graduation. This has been dubbed ‘Proceed’ (Projected completion and employment from entrant data).

The results here vary enormously. Universities with high completion rates and strong positive outcomes continue to perform very well — for example, Oxford has a Proceed rate of 89.3%. However, several universities, such as London South Bank, have a Proceed rate of less than 50%.

The data has several limitations that are worth keeping in mind.

Firstly, the response rate for most universities is between 50 and 70%. It is very difficult to predict the outcomes of those who did not reply: the graduate may have moved overseas, changed their email address, be working in a demanding role, or be unwilling to disclose for privacy or other reasons. We also do not know whether the graduates who replied are representative of their wider cohort.

Secondly, because a positive outcome is defined very generously (paralegalling and self-funding the LPC both count as such), it is difficult to infer much about graduate prospects for the universities that scored highly in this area. Nonetheless, the low threshold should give applicants an additional reason to be wary of universities with low scores.

Thirdly, the data favours academically selective universities that attract more privileged students, as well as universities whose graduates predominantly look for work in thriving job markets such as London. The inclusion of “travelling” as a positive outcome also raises eyebrows. Fortunately, the Office for Students has benchmarked all of the data mentioned above (including Proceed scores) against the age, sex, A-Level grades, ethnicity and postcode of each university’s intake. The results can be viewed here.

Finally, the data has only been collected for 2018 graduates. Students starting three-year law degrees this September will be due to graduate in 2024. The data may well change by then.

Given the high cost of tuition and living for many undergraduates, prospective law students benefit from having as much information as possible. At the same time, anyone interpreting this data should be acutely aware of its flaws and seek to complement it with information obtained from other official sources. Because the positive outcome rate is just one aspect of ’employability’, graduate salaries, careers support and the presence of a university’s alumni in the legal sector are also important to consider.

Aspiring Academic is a postgraduate student who is conducting research on issues relating to graduate employability in the UK high education sector.

The post Which unis offer law grads the best chance of securing a job? appeared first on Legal Cheek.

Listed law firms have proven collectively immune to the sell-off that took place in stock markets this month amid fears of a wave of post-pandemic inflation.

Indeed, the Legal Cheek listed law firm fund — a basket of the six main listed law firms in the UK — is actually up fractionally by 1% this month, suggesting that some investors are using the legal profession as a hedge against volatility.

With the UK interest rate at a record low of 0.1%, and inflation surging last month to 1.5%, eroding the value of money sitting in bank accounts, savers are looking for ways to protect their wealth.

Some are turning to gold, which has risen by around 4% this month, while others are focusing on consumer brands with pricing power like Unilever, whose share price is up a similar amount over recent weeks. The drift upwards in listed law firms’ values seems to place them in the same risk-off category.

Looking more closely the picture within the Legal Cheek listed law firm fund is actually quite mixed. On one hand you have DWF, whose share price has jumped by a whopping 28% this month on the back of stronger than expected financial results, while on the other there’s Rosenblatt Group, down 12%, albeit after a very strong recent run up to this point.

With the exception of Gateley, which has risen by 11% this month, the other firms in the fund — Knights, Ince and Keystone — have held pretty steady within single percentage point fluctuation ranges during this choppy period for markets.

Listed law firms are a pretty new thing, with Gateley the first one to go public six years ago after the Legal Services Act got rid of the old rule stating that only lawyers could own law firms, so it’s still a bit early to say what their precise role in the investing ecosystem is. But the steady, countercyclical nature of law would make firms which practise it a natural safe haven.

Certainly that has proved the case so far for the Legal Cheek listed law firm fund, which has ticked up nicely from an original investment of £600 in early January this year to just under £800 today. But past volatility of law firm shares, particularly in the wake of the Covid-19 outbreak last spring when several cratered dramatically, suggests the sector has some way to go before it can be relied upon to generate steady returns.

Still, the signs this year will be encouraging for the likes of Irwin Mitchell and Mishcon de Reya, as they explore the possibility of going public.

The Legal Cheek listed law firm fund

DWF Group: £116.63 fund value (107p per share)
Knights Group Holdings: £96.14 fund value (418p per share)
The Ince Group: £149 fund value (78p per share)
Keystone Law Group: £108.80 (640p per share)
Gateley Holdings: £125.37 (199p per share)
Rosenblatt Group Holdings: £193.20 (120p per share)
Total fund value: £789.14 (up from an original total of £600 invested in January this year)

Read previous instalments in our share column here. I’ll be back next month with an update on how the legal fund is getting on.

This series is in no way intended to amount to financial and/or investment advice. And remember, shares can go up as well down and professional advice should always be sought before investing.

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While aspiring lawyers train their sights on securing training contracts with global mega firms, investors in the legal sector are rather more interested the low overhead model of new flexible lawyering firms.

It’s these outfits — that offer no training contracts, have minimal office space and employ more experienced lawyers on a freelance basis — that many reckon will enjoy the strongest growth over the next decade or so. So Irwin Mitchell and Mishcon de Reya, the latest law firms to be considering going public, should expect tough scrutiny of their more traditional approaches.

The flexible lawyering firm that anybody can buy into, thanks to its public listing on the stock exchange, is Keystone Law. Since the Legal Cheek fund bought shares in Keystone in January they have risen in value from 510p to 665p per share. Not a bad return for a few months, but small in comparison to the 250% rise Keystone shareholders have enjoyed since 2017 when the firm went public at 190p per share.

Other non-listed flexible lawyering services, such as Lawyers On Demand, Peerpoint and Re:link (all spun out of big law firms), are also thriving at the moment as the pandemic-induced WFH trend encourages lawyers to re think traditional ways of working.

Is the model really the only way to run a modern law firm, though? Investors get nervous about traditional ‘Big law’ firms, which they associate with bloated networks of international offices (some of which are barely profitable), excessive lawyer headcount and costly graduate training programmes. It’s one of the reasons they have been rather frosty towards DWF, the only firm among the handful of UK listed firms that fits into this category. Accordingly, DWF has seen its share price fall from 125p upon its initial public offering in 2019 to 83p today.

But ‘Big law’ also has its advantages — a pipeline of young talent constantly entering the firm, the associated loyalty this generates as trainees progress into senior positions within the firm or outside as in-house lawyers at client companies, as well as the strength of a brand that comes from being more than a collection of self-employed individuals.

And there is no doubt it can be done with high profit margins and low overheads — see elite US law firms, with their lower staff numbers, and top UK firms like Travers Smith and Macfarlanes that have foregone international offices in favour of ‘best friend’ referral relationships with overseas law firms.

To thrive as a plc DWF knows that it needs to emulate aspects of these approaches. It’s no coincidence that it has been cutting back on support staff while pioneering a new Solicitors Qualifying Exam (SQE) graduate apprenticeship that allows new recruits to earn while they learn. What’s more, this month DWF confirmed that it’s going to be emulating the Travers Smith/Macfarlanes model of ‘best friend’ relationships with international firms — as it announced tie-ups with firms in countries where it had recently shuttered offices.

It will be fascinating to watch DWF over the next few years shift itself from the expansionary model it followed under previous chief Andrew Leaitherland to becoming something that appeals more to investor sensibilities under new boss Sir Nigel Knowles.

If the markets sense Knowles is starting to crack a new formula for success with DWF the firm’s fortunes could shift very quickly. No doubt those at DWF will have noted the recent performance of fellow listed law firm Rosenblatt Holdings whose share price is up over 100% this year alone after a bounceback in profits and recent acquisition of mid sized law firm Memery Crystal.

The Legal Cheek listed law firm fund

DWF Group: £90.91 fund value (83.4p per share)
Knights Group Holdings: £101.20 fund value (440p per share)
The Ince Group: £145.65 fund value (76p per share)
Keystone Law Group: £113.05 (665p per share)
Gateley Holdings: £113.40 (180p per share)
Rosenblatt Group Holdings: £218.96 (136p per share)
Total fund value: £783.17 (up from an original total of £600 invested in January this year)

This series is in no way intended to amount to financial and/or investment advice. And remember, shares can go up as well down and professional advice should always be sought before investing.

The post Pressure to generate returns forces listed law firms to think outside the box appeared first on Legal Cheek.

Two of the lesser talked about listed law firms have powered Legal Cheek’s fund of lawyer PLCs into profit after enjoying a storming month — with investors who bought these shares at their low points last spring enjoying staggering returns of as much as 350%.

The Ince Group jumped from 50.50p per share just a few weeks ago to as high as 83p per share last Thursday while Rosenblatt Group Holdings (RGH) ticked up from 80p last month to 96p this morning.

Ince’s share price plunged from 189p per share at the start of 2019 to just 18p last March amid the unfolding Covid crisis. And Rosenblatt’s dropped sharply from 137.50p in 2018 to 50.50p last April. As the markets have settled amid vaccine optimism, investors seem to have come to the conclusion that these professional services business are fundamentally sound and worth backing. Indeed, the returns for those who bought Ince shares in the latter part of 2020 have been Bitcoin-esque.

Still, it must have been an unnerving period for both outfits — whose current value remain some way off previous highs. At least when times are tough for regular unlisted law firms operating under the traditional partnership model you don’t have the distraction of a plummeting share price. It’s hard to imagine the severity of Ince’s 90% fall in value not playing on the minds of some clients at the time.

This reputational factor is one of the main things that puts off many law firms from going public. Being sellers of a product (legal services) typically purchased by companies as a way to minimise risk, it’s not a great look when your own valuation is in a steep decline. Still, the comebacks made by Ince and Rosenblatt show that they have the robustness to maintain confidence during challenging times.

The remaining firms that make up the Legal Cheek fund — DWF, Knights, Keystone and Gateley — are all also in the green this month, giving the fund a total value of £707.34. This marks an 18% return on the original investment of £600, when I put £100 into six law firms at the start of the year.

The Legal Cheek listed law firm fund

DWF Group PLC: £91.56 fund value (84p per share).
Knights Group Holdings PLC: £100.74 fund value (438p per share)
The Ince Group: £145.65 fund value (76p per share)
Keystone Law Group PLC: £107.10 fund value (630p per share).
Gateley Holdings PLC: £107.73 (171p per share).
Rosenblatt Group Holdings PLC: £154.56 fund value (96p per share).
Total fund value: £707.34

Read previous instalments in our share column here. I’ll be back next month with an update on how the legal fund is getting on.

This series is in no way intended to amount to financial and/or investment advice. And remember, shares can go up as well down and professional advice should always be sought before investing.

The post Law firms’ soaring share prices yield Bitcoin-esque rewards 🚀 appeared first on Legal Cheek.

If the UK’s 100,000+ law students clubbed together to buy shares in listed law firms could they push their value through the roof, enabling them to dramatically expand their training contract numbers and create hundreds of new opportunities for future lawyers?

Even amid the current excitement surrounding Gamestop, a struggling US video game retailer whose shares have surged by over 8,000% (before plunging by 67%) amid coordinated buying by millennial day traders on the WallStreet Bets Reddit page, the above scenario seems pretty far-fetched.

But who’s to say that the Gamestop principle — which sees amateur traders invest en masse in unfashionable companies that hedge funds have bet will fall in value, driving up the share price dramatically — couldn’t apply to listed law firms?

Looking at the Legal Cheek listed law firm fund, the firm most likely to come to the attention of the Gamestop crew is DWF, whose value is down considerably since the onset of the Covid-19 pandemic last spring and has a short position taken against it by London asset management fund Merian Global Investors.

Another firm that could fall into this category is Ince Group. While there are no disclosed shorts against Ince, like DWF it carries significant levels of debt, which while not necessarily bad in itself could hinder recovery in a downturn. And the fact that the Ince Group share price has fared so badly over the last few years (it’s down 74% since 2018) means that there is plenty of upside (although room to fall further too). So anyone looking for ‘DeepFuckingValue’, as the Reddit investor who led the Gamestop buying terms himself, may find themselves tempted to have a flutter.

Of course, amateur investors motivated by disrupting the status quo and giving boomers a bloody nose may think twice about piling into corporate law firms and enriching their owners. There was a reminder last week of the wealth that can go to the select few who take law firms public when it was revealed that Knights boss David Beech is set to pocket £61 million from cashing in almost half his shares.

And so to the Legal Cheek listed law firm fund, which has surged in value by 15% this month. The big movers are Rosenblatt Group Holdings (up from 57p per share to 77p) and Gateley (up from 144p to 176.50p). Both firms expect their latest revenue figures to exceed expectations.

Keystone is also up substantially from 510p to 575p per share after releasing a strong trading update last week, while Ince has gone from 46p to 50.50p and Knights 368p to 402p. At the time of writing DWF is the only faller, dropping from 83.50p to 81p. The value of the overall fund rose from £532.90 a month ago to £615.15 today, meaning I’ve not only already recouped my original investment and trading platform charges but reaped a profit of £15.15. Heady days in the markets.

The Legal Cheek listed law firm fund

DWF Group PLC: £88.29 fund value (81p per share).
Knights Group Holdings PLC: £92.46 fund value (402p per share)
The Ince Group: £96.65 fund value (50.50p per share)
Keystone Law Group PLC: £97.75 fund value (575p per share)
Gateley Holdings PLC: £111.20 fund value (176.50p per share)
Rosenblatt Group Holdings PLC: £128.80 fund value (80p per share)
Total fund value: £615.15

I’ll be back next month with an update on how the legal fund is getting on.

This series is in no way intended to amount to financial and/or investment advice. And remember, shares can go up as well down and professional advice should always be sought before investing.

The post Could the Gamestop craze reach law firm stocks? appeared first on Legal Cheek.