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Crooked Marriages & the AFR Law Firm Profit Survey
Posted by The Spy | Posted in Firm Gossip | Posted on 7.24pm
The Firm Spy is the product of a few corporate-types who, approximately one a year ago, were so agitated by what we perceived to be biased reportage of corporate Australian firms in news media that we decided to do something about it.
We created our own news/gossip website.
The incredibly close affiliation existing between corporate firms and news journalists, many of whom we understand maintain close personal friendships, has in our view spawned a crooked marriage of convenience that permits corporate firms to perpetuate an unfairly positive image in the media.
Our belittling posts are (we hope!) the dirty mistress lurking in the closet of this corporate wedding.
We consider ourselves a news source, of sorts, though the BRW and The Australian have referred to us as a blog. Call us what you like, but our aim has been, and continues to be, about providing a clearer picture of what is transpiring in corporate Australia.
Flowing from this, one of the major themes of the Firm Spy in our first year has been an analysis of the strategies used by corporate partners to quarantine profits from the dire economic times endured through the GFC. Regularly, we have queried whether frugal partnership antics can be justified in the face of awe-inspiring seven-figure salaries.
We thus welcomed the watershed moment that occurred last week with the publication of the AFR (18/9). The AFR Law Firm Profit Survey was published, profiling each of the top 10 Australian law firms by revenue. The partnership profit-take exposed in the survey provides the most candid insight yet witnessed into the impact that the GFC has had on partnership profit.
It is based on these statistics that we can consider the legitimacy of the comments and actions of corporate partners over the last financial year in response to the GFC. The figures released in this report will be the subject of an in-depth analysis on each firm by the Firm Spy over the course of the next week.
Stay tuned!
Send the Firm Spy your news and views!
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The AFR has been publishing a profit survey annually for years. This is not new.
Yeah, but the relevance of these reports, in light of the near-unethical behaviour of larger law firm partners during the last 18 months to 2 years, has never been greater.
I suggest the two knob partners (or senior HR employees) commenting above consider the meaning of the phrase ‘fit and proper person’.
A Portsea mortgage just isn’t worth your self-respect.
I agree with Sleepy Afternoon. If some of the partners in large law firms were employees in a private company, they would find themselves in a lot of hot water in respect of the way that they have behaved. Being in a partnership they get away with their unethical behaviour because their fellow partners turn a blind eye and their remaining employees are too scared to speak out in the media for fear of dismissal. The marketing and HR departments are meanwhile busy completing surveys so that the firms can claim to be “employer of choice’ etc or winner of an award that no-one has ever heard of. A analysis of the statistics that these firms have proudly made available (without mentioning their behaviour over the last year) is necessary so that the public can judge themselves the legitimacy of their actions.
What is the “unethical behaviour” of which you complain? Retrenching people? How would that land an employee in a private company in hot water, particularly as so many of those companies also retrenched people? Really.
Just to clarify, Blobby, the “near-unethical” behaviour of which I’m contemplating relates to: pay freezes across all junior lawyers irrespective of charge-out rate increases, promotions (i.e. lawyer to SA) or budgets, on the back of largely incorrect and opague predictions of economic disaster; making empty and insulting promises to redistribute equity to staff ‘when things turn around’ without any intention of actually doing so beyond existing bonuses; using the GFC and people’s fears of it to - in the words of several Corrs partners - correct ‘inflated’ juniors lawyers’ wages (despite earning proportionally similar amounts).
I think lying to staff, or at best, recklessly ignoring the actual state of the economy so you can fu*k the people that prop up your business, is near-unethical.
Further, solicitors are to be held to a higher standard than most. Maybe those of us who took the oath more recently (or affirmation, such as it is), can remind these test-tube babies what it is to be a ‘fit and proper person’.
Oh good grief. When you understand that the purpose of a business is to reward the owners (whether it be a law firm, the shareholders of an incorporated entity etc) then perhaps you will grow up.
I love your reference to “redistribute equity”- like that’ll ever happen!
As a newly admitted lawyer, the one thing you will have to understand is that this is not the first recession that has hit law firms- and it won’t be the last. In those times, everyone suffers- incl the partners, although your quoting of stats that are based on guesswork had led you to believe this is not the case.
I didn’t see any lawyers saying over the last few years “gosh, I really think my 20% year on year salary increases are not sustainable” or “I think I’ll show loyalty to the firm that hired me rather than bugger off after a years training just so I can earn more money in London/Dubai/Abu Dhabi”. Everyone in this game is out to maximise the benefits for themselves- it’s just that the cycle has turned against employees for the moment- and I can guarantee it will turn back in their favour again in due course….
Blobby, thank you for passing the epsom salts under my nose; that was just the reality check I required.
For the record, readers, the response from the intellectual behemoth, ‘Blobby’, has had me rechecking my “stats” (although it is clearly due to my naivety that I cannot find a single rudding “stat” in either of my posts), all the while glancing at my newly-minted practising certificate for affirmation of my self-worth.
You, sir, are a buffoon of the highest order. I would suggest your use of the term ‘good grief’ already pegs you as a baby boomer, sustained only on the tears of innocents and the blood of puppies, and completely unable to sustain a cogent counter-argument that doesn’t conclude with “bloody Gen-Y”.
Apparently generalisms are not tolerated by the older folk, despite Blobby’s wildly accurate assertions that there are no lawyers questioning continued pay increases or remaining at a law firm for longer than 1 year. It’s like a bloody merry-go-round of pay rises that I can’t get off. Except I do so. Every year. Apparently.
Besides failed investments in Opes Prime, B&B and Blobby’s fitness camp, how have top-tier law firm partners suffered in this downturn? Revenues up and costs down… that seems to suggest double-digit increases in pie pieces in the last FY? And that is based on the figures published on this website and AFR. Not quite guesswork. 2007/2008 saw most top-tiers hit budget. Where is the pain?
So.
I have outed myself as an ungrateful, good-for-nothing, disloyal third year - what’s your stake, Blobby?