AustrAliA
sAlAry &
employment
insights
2013/14
legAl
tAble of contents
introduction
About hudson legAl
under pressure: doing more with less is the new commerciAl reAlity
mArket commentAry
conclusions
sAlAry tAbles
AustrAliA
reseArch methodology
hudson's thought leAdership progrAm
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3
8
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16
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i am pleased to introduce the hudson legal salary & employment insights for 2013/14.
each year, we conduct a comprehensive study of 318 employers and 130 employees in Australia and new Zealand within the legal industry. we analysed their responses and cross referenced them with our own data to provide a salary guide for the legal profession that offers rich data, industry perspective and fresh insights.
this guide is set in the context of the economically challenging times that have become the norm around the globe. market conditions continue to be tough both in Australia and new Zealand.
over the next 12 months, the challenge for employers is to attract and hold on to the people who can help them thrive in uncertain times. for this best-in-class talent there will always be job opportunities and firms must equip themselves to compete for these highly prized employees as best they can.
we undertook research to understand what kind of impact the economic environment is having on Australian and new Zealand workplaces and how it is affecting work practices, compensation and benefits and, importantly, employee engagement, morale, loyalty and job seeking behaviour.
in this year’s salary & employment insights, we explore the push and pull factors for those seeking new roles and evaluate the salary expectations of today’s employee.
we hope you will find our salary & employment insights valuable. As always, we welcome your feedback.
Dean Davidson
national practice director — hudson legal executive general manager, regional Australia
our dedicated legal consultants have earned the respect of their legal clients from a range of industry sectors. most our legal consultants are former qualified lawyers who have worked in the
Australian legal market. they have strong and active relationships with many top Australian and international law firms, as well as a wide range of companies and federal, state and local government authorities. they are also well networked within the legal community and have strong and active relationships with many high quality lawyers.
hudson understands the legal profession in Australia, and as a truly international and networked organisation, we are able to source opportunities and people from not only Australia but across the globe.
we also strive to keep you up to date through timely research and thought leadership.
As a leading global recruitment specialist, we meet the challenge of recruiting, hiring and managing employees while meeting demanding deadlines.
through applying proprietary tools, specialist talent management and recruitment expertise, we can pinpoint individual's competencies and motivations — matching private practice, in-house and public sector legal professionals with the right organisational culture and optimum role for long-term performance.
working with many of Australia’s leading organisations, our strong brand enables us to attract and select the right people to help you grow your business.
positive. growth is expected to continue and the unemployment rate is forecast to remain steady at around 5.5%.6 inflation
is expected to remain in the rbA target range of 2–3% in 2013.7
workplAces under stress
these challenging conditions are having a marked effect on the workplace. Australian and new Zealand employers are experiencing increased pressure on budgets (78.9%), greater workloads (69.4%) and more stringent headcount approval processes (62.5%).
four out of five (80.2%) employers say their teams have to do more with less and only one in five (20.3%) employers say they always replace roles if a member of their team leaves. when roles are not replaced, the majority of employers (68.1%) distribute the work amongst the remaining team members. in some organisations, other managers absorb the workload (7.6%) or they engage contractors (6.4%) (Fig 1).
As employers strive to succeed in this difficult business environment, employees are taking on more work. most people (87.4% in Australia) now report working more than 40 hours per week.
Just over three-quarters (77.0%) of all legal employees surveyed reported that they had taken on greater or new responsibilities in their current role compared to a year ago, and just under half (46.4%) said they were not financially rewarded for this increased workload. 2013 has been a slow year for the global
economy1 and market conditions remain
tough all over the world. growth is easing in the us, Japan and china; europe is in recession.2 the imf has cut its global
economic growth forecast to 3.3% for 2013 (down from the January forecast of 3.5%) but growth is expected to rise to 4% in 2014.3
the imf forecasts that the Australian economy will grow by 3.0% in 2013, rising to 3.3% in 2014.4 Australia is the
world’s 12th largest economy5 and its
long-term economic outlook remains
under pressure: doing more with less
is the new commerciAl reAlity
IF A MEMBER OF YOUR TEAM LEAVES AND IS NOT REPLACED, WHAT HAPPENS TO THE WORK THAT WAS
CARRIED OUT BY THE PERSON WHO HAS LEFT? (All employers)
Distributed amongst the remaining team members
The manager absorbs more workload Continued by a contractor Other
Given to one other person in the organisation Outsourced Discontinued 68.1% 7.6% 6.4% 5.9% 4.9%4.2% 2.9% fig 1
four out of five employers sAy their teAms hAve to do
more with less.
employee sentiment
the number one thing all active and passive legal job seekers are looking for is an increase in pay — 27.2% cited this as the most important consideration when moving jobs.
Additional important considerations for legal professionals when seeking a new role included: better career opportunities (13.6%), a role they were more interested in (12.8%) and an organisation with a work culture that would make them happy (12.8%) (Fig 2).
salary is a motivator to stay on in an organisation too: 44.0% of all legal respondents who were actively or passively looking for roles said that an increase in salary would make them more likely to stay.
interestingly, in spite of the current environment and significant employee stress levels, morale is not the major concern of employers.
legal professionals also reported increased levels of stress. 37.0% of employees claimed that they were more stressed at work than a year ago. According to the Q4 2012 hudson report, a quarter (24.7%) of employers in Australia are seeing increased levels of burnout in their employees.
Just under half (44.4%) of all legal professionals are actively or passively seeking a new role. of those looking to make a move, 57.1% said they were expecting to move within the next six months.
More educational and training opportunities than I currently have More seniority and responsibility than I currently have An organisation with a work culture that will make me happy More pay than I currently have
WHICH OF THE FOLLOWING ASPECTS WILL BE MOST IMPORTANT TO YOU WHEN LOOKING FOR YOUR NEXT JOB?
Strong leaders and a manager I respect An organisation with values that I believe in Better working conditions than I currently have
Different sector/industry A role that I’m more interested in
Better career opportunities than I currently have
% of respondents
0 5 10 15 20 25 30
Legal employees All employees
fig 2
44.4% of legAl professionAls Are Actively or pAssively
seeking A new role.
sAlAry outlook 2013
the majority of legal employers in Australia and new Zealand (62.0%) plan to award pay increases of 3–4% in 2013. Across all organisations surveyed, the main reason cited for giving a pay rise was to retain high performers (57.9%). Just over three-quarters of legal employers (87.7%) said that they would reward all their high performers with pay rises. of those that would not be doing so, (81.3%) were concerned about losing talent.
will employees be recognised for their hArd work in 2013?
hudson’s research shows that:
| 42.3% of all legal employees surveyed believed they deserved a pay rise simply to keep up with the cost of living.
| Almost two-thirds (63.7%) felt they were either not adequately rewarded for their contribution to the business, or that their high level of performance warranted a pay rise in recognition of this. 43% of legal professionals said they deserved a salary increase because of their own high performance.
| A little more than a third (35.2%) said an increase was warranted because they had taken on greater or new responsibilities.
only 24.5% of all employers report that their team members have lower morale than a year ago, while 67.3% of legal employees report feeling the same or higher levels of optimism over the same period. Almost half (43.7%) of all legal employees say they are more engaged at work than they were 12 months ago.
when employees are working longer and harder and feeling more stressed, it may be possible to reduce the negative effect on their morale. strategies to achieve this include clearly communicating organisational objectives and plans to staff.
people who understand their organisation’s strategy and vision are more likely to be engaged and put in discretionary effort to help achieve business objectives. where they have chosen to take on more work, they may be feeling more stressed but they are also more likely to feel engaged and optimistic.
+
37.7% say they are more positive
+
43.7% say they are more engaged than this
time a year ago
–
37.0% say they are more stressed
–
26.1% say they feel less loyal to their
employer than 12 months ago
recognition
formal reward and recognition programs, and informal feedback from managers show employees that their contributions are valued and promote staff satisfaction and loyalty.
when rewards are not an option, companies should focus on recognition. this includes acknowledging when a staff member has achieved a great result for a client, surpassed utilisation/ realisation targets, or has overcome a major client challenge.
bonuses
despite the tough environment, 59.1% of all surveyed employers plan to award bonuses in 2013, and the majority will link this to individual (51.9%) or company (40.9%) performance. employers are also offering a range of benefits as part of the package. After base annual salary, the top three staff benefits and rewards offered by employers are flexible working arrangements (63.0%), financial bonuses (54.8%) and subsidised health benefits (34.6%) (Fig 3).
Note: Figures do not add up to 100% as respondents could select all that applied. WHAT BENEFITS DO YOU OFFER AS PART OF SALARY/
REWARD PACKAGES TO EMPLOYEES? (All employers)
% of respondents
0 10 20 30 40 50 60 70
Additional leave Income protection insurance Company car Private health insurance Other
Fully paid health benefits Reduced work hours Subsidised health benefits Increased superannuation Death/disability insurance Flexible working arrangements Bonuses
fig 3
44.0% of All legAl employees Actively or pAssively looking
for roles sAid thAt An increAse in sAlAry would mAke them
more likely to stAy.
it makes commercial sense to let employees know they are valued. the benefits most valued by employees in the legal profession are:
| bonuses (62.0%),
| increased annual leave greater than the legislated standard of 20 days (45.1%),
| flexible working arrangements (42.6%), and
| private health insurance (33.8%) (Fig 4).
benefits
All employee survey respondents made a number of suggestions when asked to name a benefit that would appeal to them. ideas included: company parking, domestic travel allowance, technology/ phone/device allowance or study leave, time in lieu and public transport allowance. evidently, one size does not fit all.
Note: Figures do not add up to 100% as respondents could select up to three options. WHAT BENEFITS WOULD YOU VALUE AS PART OF YOUR
SALARY/REWARD PACKAGE? (Legal employees)
% of respondents
0 10 20 30 40 50 60 70
Paid maternity leave
Company car Gym membership
Car allowances
Death/disability insurance Paid paternity leave Other Private health insurance Increased superannuation Income protection insurance Flexible working arrangements Increased annual leave (more than standard 20 days) Bonuses
fig 4
despite the tough environment, 87.7% of legAl employers sAid
thAt they would rewArd their high performers.
increasingly, legal employees report struggling under the weight of time billing targets, and the pressure to bill more hours.15 As a consequence employees at
all levels are feeling under greater stress. with heightened fee pressure and increased competition for work, law firms are offering clients flat fees and other alternative fee arrangements.16 this is
also putting more pressure on employees to deliver a greater number of projects.
commercial litigators are in short supply due to the fact that generally there is limited movement in this area — it is often difficult for litigators to transition into an in-house role, and these lawyers tend to remain in a private practice role where they are happy. where litigators do make the decision to leave private practice, it is usually to go to the bar.
senior construction lawyers (both front-end and back-end), defendant insurance lawyers, as well as employment lawyers are highly sought after, both for in-house and private practice roles. demand for these skill-sets is particularly strong in the brisbane legal market.
legal professionals with expertise in superannuation and life insurance have been highly sought after this year, both for private practice and for in-house roles. this has been largely due to the
legislative changes contemplated by future of financial Advice (fofA).17
given that the changes will be effective as of 1 July, the demand for this skill set will likely taper off. private practice firms and companies are looking for mid-level property lawyers. this is particularly true in sydney where property prices are reaching record highs.18
more and more companies are looking abroad for acquisition targets or merger partners to help them meet their growth aspirations to enter new markets and product lines, find new customers and develop new capabilities.8 six of the 11
largest law firms in Australia have merged their domestic operations with foreign firms over the last three years to grow their capacity and presence in international markets.9
mid-tier firms could benefit from the influx of global law firms entering the Australian market.10 independent unaligned firms are
concentrating on Australian transactions and referrals11 and are perceived by
cost-conscious clients to offer quality legal service at competitive rates.12 their
strength in the marketplace is attracting many top-tier lawyers who specialise in areas specific to the local jurisdiction.
large global and national law firms have been affected by a fierce talent war that has escalated in the past six months.13
employees across the board are working longer hours and taking on more work to cover roles that have not been replaced.
most legal employers (85.5% in Australia) report working more than 40 hours per week.14
mArket commentAry
contract lawyers are providing strategic and tactical support to government legal teams. however, the appetite for contractors is easing for in-house roles due to cost constraints.
2013 will be a competitive market for job seekers. salary however, should not be the only driver when making a decision about a role. candidates should look beyond that to determine what each opportunity could contribute to their career development.
most in demAnd roles/skills: | commercial litigators
| senior construction lawyers (both front-end and back-end)
| defendant insurance lawyers
| property lawyers
| specialists in superannuation and life insurance
demand for lawyers with experience in the energy, resources and corporate sector is therefore declining. despite miners being prepared to push ahead with existing plans, exploration has been scaled back.19
china is Australia’s biggest export market and the weaker than expected gdp data coming out of the world’s second-biggest economy added to concern about the global growth outlook.20
this is due to the lack of funding for exploration projects in western Australia, with companies putting these projects on hold due to subdued growth in china over the last quarter.
while a competitive base salary is important, many people take other things into account when choosing an employer. our survey highlighted that better career opportunities, more interesting work, company culture, flexible working arrangements, increased annual leave and meaningful employee reward and recognition programs, along with other factors, can all contribute to making a particular employer desirable.
rewArd And recognition
if employees understand that their efforts will be recognised and rewarded they are more likely to be engaged, work productively and contribute to a positive company culture that can survive an economic slowdown.
remunerAtion And beyond
our research shows that most people still remain motivated by pay. consequently, when budgets are tight it makes sense for employers to prioritise spending and ensure that reward and recognition programs incentivise high performance. employers should look at their overall remuneration strategy. does it focus on a combination of the value of a role to a company, internal and external relativities and individual performance and potential?
conclusions
with pressure on remuneration budgets, there should be a focus on rewarding those employees in critical roles which may be hard to replace, and roles which may have fallen behind in the market.
hudson recommends that employers review other benefits regularly to ensure that employees value them.
employers should bear in mind that, when times are tough, it may be better to increase base salaries, scale back benefits that are not always highly valued and look at lower-cost ways of boosting staff morale and engagement. it's also important to include regular and honest communication with managers and positive feedback on work or projects as appropriate, and ensure that people are aware of business challenges and objectives.
in developing this guide, we aim to provide intelligence to help clients invest their salary dollars effectively. Attending to the needs and wants of your people is always important; in uncertain times it is critical.
please contact us if you would like to know more. local office contact details are on the back page of this guide.
mArket conditions Are tough
2013 continues to be another difficult year. As global economic uncertainty continues, Australia and new Zealand remain relatively sheltered but the challenges of doing business in such an environment change daily.
mAking the right hire
it’s clear that companies are cautious about recruiting right now. for organisations that are hiring it’s vital to maximise return on investment by choosing the best candidate with the right motivational and cultural fit for the organisation. people who are committed to the company's vision and who fit the culture are those most likely to thrive and help achieve business goals.
A compelling AttrAction proposition
it’s imperative to develop a clear and effective attraction strategy to ensure a pool of quality candidates for roles. this includes creating an authentic and persuasive employee value proposition.
Act nsw Qld vic wA ANNUAL SALARY 2013 AUD ’000
top tieR 0–1 year pQe 62–77 72–82 62–72 72–82 74–80 1–2 years pQe 77–88 79–95 67–82 79–93 80–92 2–3 years pQe 82–93 91–103 77–93 84–101 88–100 3–4 years pQe 93–108 93–118 82–103 93–113 96–112 4–5 years pQe 103–113 108–139 93–124 103–134 111–134
5–6 years pQe — not sA 113–124 113–144 113–144 118–144 118–140
sA1 108–124 144–165 124–155 134–160 147–170 sA2 124–139 144–180 134–165 139–165 150–170 sA3 139–165 165–196 144–185 149–191 168–186 sA4/special counsel 155–206 175–299 155–258 185–278 200–300 salaried partner 206+ 309+ 258+ 309+ 350+ miD tieR 0–1 year pQe 62–72 67–77 57–72 67–77 65–74 1–2 years pQe 72–82 70–92 67–77 70–88 71–84 2–3 years pQe 82–93 75–98 72–93 75–95 82–93 3–4 years pQe 93–103 82–108 77–103 82–108 88–110 4–5 years pQe 98–108 95–129 88–108 93–124 106–130
5–6 years pQe — not sA 108–118 103–139 103–124 103–134 112–135
sA1 113–124 113–144 113–134 118–139 128–165
sA2 118–129 118–155 124–165 118–149 123–147
Act nsw Qld vic wA ANNUAL SALARY 2013 AUD ’000
miD tieR (cont.)
sA4/special counsel 139–180 144–247 155–227 155–227 180–220 salaried partner 185+ 206+ 206+ 206+ 250+ BoUtiQUe 0–1 year pQe 41–57 46–72 41–62 52–62 62–85 1–2 years pQe 52–67 52–82 52–72 62–72 72–95 2–3 years pQe 67–82 62–88 57–77 67–88 83–100 3–4 years pQe 77–93 79–102 72–88 74–98 94–120 4–5 years pQe 88–103 91–124 82–103 82–113 114–150 5–6 years pQe 93–113 93–129 88–108 88–118 115–155 sA1 103–118 103–149 93–113 98–124 140–175 sA2 113–124 113–155 103–124 108–134 138–175 sA3 118–144 124–170 124–155 113–165 168–200 sA4/special counsel 144–185 129–227 134–206 124–185 220–300 salaried partner 155+ 155+ 144+ 149–309+ 350+ iN-hoUSe (geNeRAL) 0–1 yrs pAe/pQe 52–62 67–80 57–67 62–77 60–80 1–2 yrs pAe/pQe 57–77 77–92 67–82 74–93 75–100 2–3 yrs pAe/pQe 72–103 88–115 72–103 88–108 85–115 3–4 yrs pAe/pQe 93–124 93–129 82–124 93–129 100–115 4–5 yrs pAe/pQe 113–124 108–149 103–155 103–139 110–140 5–6 yrs pAe/pQe 124–144 118–155 124–185 113–152 120–160
Act nsw Qld vic wA ANNUAL SALARY 2013 AUD ’000
iN-hoUSe (geNeRAL) (cont.)
6+ yrs pAe/pQe 139–155 134–227 134–206 134–206 140–250
deputy general counsel 149–175 155–278 185–247 165–247 140–260
general counsel 206+ 186–309+ 180–300+ 196–309+ 180–300+ Qld po3 69–76 po4 80–91 po5 91–88 po6 100–106 so1 118–124 so2 108–113 ses1 108–124 ses2 133–150 ses3 152–178 ses4 184–195 goveRNmeNt Act nsw 0–1 yrs pAe/pQe 46–62 52–67 1–2 yrs pAe/pQe 62–82 67–82 2–3 yrs pAe/pQe 82–93 77–88 3–4 yrs pAe/pQe 88–98 82–93 4–5 yrs pAe/pQe 93–108 88–103 5–6 yrs pAe/pQe 98–134 103–124 6–10 yrs pAe/pQe 113–144 124–144 ses1–6 144–258 149–288 vic vps1 38–40 vps2 42–54 vps3 56–67 vps4 68–77 vps5 78–95 vps6 97–129
senior technical specialist 7 131–178
All government figures above are exclusive of super.
please note: salary ranges are based on information provided by hudson clients, candidates and other sources and as a result are approximate guides only. they relate to base salaries including superannuation but do not include things like bonus/incentive schemes/stock options. further they incorporate placements across both small to medium companies (defined as having a turnover of less than $100 million) and large companies (defined as having a turnover of more than $100
employers and employees each received distinct survey questions. percentages don't always total 100% as respondents could select more than one option for certain questions.
the questionnaire responses were collected across october and november 2012. respondents were incentivised by a prize draw carried out internally by hudson. A total of 4,921 employers and 5,853
candidates within hudson’s Australia and new Zealand database were surveyed from a range of professions with 130 employers and 318 employees from the legal profession.
reseArch methodology
All urls referenced in footnotes were viewed on 16 may 2013.
references
1 'shaken, not stirred', The Economist, may 11 2013, print edition, p. 72.
2 The global economy is losing steam 2013,cnn money, <http://money.cnn.com/2013/04/23/news/economy/slow-global-economy/index.html>. 3 IMF cuts global growth forecast 2013,cnn money, <http://money.cnn.com/2013/04/16/news/economy/economy-imf/index.html>.
4 World Economic Outlook (WEO) — Hopes, Realities, and Risks 2013,international monetary fund, <http://www.imf.org/external/pubs/ft/weo/2013/01/>. 5 Australia becomes world's 12th largest economy 2012, the hon wayne swan mp, deputy prime minister and treasurer, <http://www.treasurer.gov.au/displaydocs. aspx?doc=pressreleases/2012/095.htm&pageid=003&min=wms&year=&doctype=0>.
6 April Key Figures, 6202.0 — Labour Force Australia 2013,Australian bureau of statistics, <http://www.abs.gov.au/ausstats/[email protected]/mf/6202.0>.
7 Inflation expected to stay benign 2013,the sydney morning herald, <http://news.smh.com.au/breaking-news-business/inflation-expected-to-stay-benign-20130422-2i9ic.html>.
8 The renaissance in mergers and acquisitions: The surprising lessons of the 2000s 2013, bain and company, <http://www.bain.com/publications/articles/the-renaissance-in-mergers-and-acquisitions.aspx>. 9–11 Freehills joins race to conquer the world, financial review, <http://www.afr.com/p/national/legal_affairs/freehills_joins_race_to_conquer_32e65Acrse9iycqdypZjpl>.
12 Fee earners feature big in law partner equation 2012,financial review, <http://www.afr.com/p/national/legal_affairs/fee_earners_feature_big_in_law_partner_vfdmjss7vk6xXqnw92cefo>. 13 Talent wars lead to high-level musical chairs 2012,financial review, <http://www.afr.com/p/national/legal_affairs/talent_wars_lead_to_high_level_musical_nowccmctapfckerw0o4eQo> 14 The Hudson Report: Employment Trends, October–December 2012, hudson, <http://au.hudson.com/knowledgecentre/hudsonreport/introduction.aspx?report=2012-Q4>.
15 Coping with Stress and Avoiding Burnout: Techniques for Lawyers 2013,the canadian bar Association, <http://www.cba.org/cba/practicelink/bwl/stresscoping.aspx>.
16 Hourly Billing Loses Ground as Pressure for Flat Fees, Other Breaks Outlives Recession, walny legal group, <http://www.walnylegal.com/hourly-billing-loses-ground-as-pressure-for-flat-fees-other-
breaks-outlives-recession/>
17 Future of Financial Advice (FOFA) 2013, pricewaterhousecoopers, <http://www.pwc.com.au/industry/financial-services-regulation/fofa.htm>.
18 House prices post biggest rise in three years 2013, Abc news, <http://www.abc.net.au/news/2013-04-02/house-prices-jump-in-most-capital-cities/4604776>. 19 WA mining applications up, exploration down 2013, Australian mining, <http://www.miningaustralia.com.au/news/wa-mining-applications-up-exploration-down>. 20 Miners hit as China worries rattle shares 2013, financial review, <http://www.afr.com/p/markets/gold_stocks_lead_sharemarket_lower_cq2t7sQbwi13Jpqm3swQum>.
hudson ict industry leAders series
each year, hudson brings together industry experts across the ict sector to gain further insight into which factors are influencing operations and to forecast what opportunities and challenges lie ahead.
the hudson ict industry leaders series 2012/13 focuses on how new world technologies such as bring your own device (byod) and cloud computing are driving changes in the way employees behave, and the impact that this is having on organisations’ it departments and the skills required of these employees.
to access the report, go to au.hudson.com/ILS
the hudson report: employment trends
the hudson report is an established employment market trends report, based on in-depth and nationwide research. released every quarter, the report highlights key hiring trends and provides specialised insights and commentary for core industry segments and professions across ApAc . the hot topic feature of the report explores current human resource issues impacting businesses and the broader ApAc economy.
for details, see
au.hudson.com/hudson-report As an industry thought leader, hudson
produces a wide variety of white papers, conducts specialist forums and regularly contributes to the media on hr and employment trends. here’s a selection of some of the research we've produced. if you wish to register for hudson's thought leadership publications, please visit au.hudson.com/thought-leadership
hudson's thought
leAdership progrAm
contAct us
to discuss the salary & employment insights or your recruitment needs in more detail, please contact your hudson recruitment consultant or email us on
[email protected] AUStRALiA Adelaide +61 8 8223 8800 brisbane +61 7 3258 8333 canberra +61 2 6229 1555 melbourne +61 3 9623 6666 mount waverley +61 3 9535 8222 newcastle +61 2 4927 2220 perth +61 8 9323 0222 sydney +61 2 8233 2222 au.hudson.com
