This newsletter has focused recently on in-house compensation in the U.S., but what about elsewhere? In a piece from The Lawyer, a leading UK legal publication, Katy Dowell focuses on corporate counsel comp and the impact of the pandemic and the law firm salary wars on corporate counsel pay. It’s an interesting take. “While private practice firms can respond quickly to the market by raising pay, awarding bonuses and tackling their ESG policies to attract talent," Dowell writes, “the in-house legal team is beholden to the business it serves. This last 18 months has not seen many companies willing to shower their legal teams with more pound notes, putting them in the crossfire of an ongoing talent war.” Citing an August salary report from recruiter Taylor Root, “demand for junior to mid-level in-house lawyers is rising while supply is weakening as private practice salaries rocket.” Even more interesting, Dowell says senior in-house lawyers have been “put out to pasture” as corporates bow to market pressure and cut back headcount and salaries. Indeed, even as the to-do lists for in-house teams have grown longer during the pandemic, some in-house lawyers suffered salary cuts as high as 40% in 2020. This has prompted some GCs to reverse field and return to private practice. Dowell’s conclusion: “After the 2008 financial crisis, in-house teams ballooned in size and skillset. The pandemic crisis has seen in-house investment plateau, while law firms have largely enjoyed a standout year. This means that in the power dynamic between corporates, firms and partners, it is the corporates which have the weakest hand right now. It is a moment of change that could set the tone for the next decade.”
