Afters news was released that Linklaters’ top of equity took home 33 per cent more than it did the previous year, senior management have been in discussions about reforming their current lockstep remuneration system. The highest paid partners took home £3.2m compared to the £2.4m that they received the previous year, which questions the efficacy of the pure lockstep structure in place.
A lockstep model of compensation is a system based on seniority, where employees are paid according to their rank within the firm. For example, Linklaters currently runs a lockstep from 10 to 25 points. Points usually increase by 1.5 a year, meaning it takes the average Linklaters’ partner 10 to 12 years in order to reach the summit of the lockstep. The model has been favoured by many firms due to the ease of administration and the fact that it harbours a sense of unity and togetherness within firms. However, this form of remuneration, which is common within magic circle firms has recently been called to question due to its rigid structure and inability to attract new talent to the firm.
Earlier in the year, the firm announced plans to reform the lockstep system due to the fact that it was losing a lot of talent to competing firms. The firm initiated a merit-based factor to its associate lockstep model in 2013, which saw associates being rewarded based on their performance as well as their longevity within the firm.