Salary, shmalary – firms are all about the benefits these days
It’s quite a job, telling the difference between the pay packets on offer from the UK’s leading law firms. It’s not that salaries remain frozen – more that with continuing economic uncertainties, salaries are only rising in line with competitors. Nor does this trend seem likely to change any time soon.
But look a little off-centre and you’ll see a different playing field altogether: one in which UK law firms are competing for talent by offering the best workplace benefits. And some of these benefits are proving surprisingly creative for this most traditional of professions.
The vast majority of firms offer a typical range of benefits including pension schemes, life assurance, private medical/dental insurance, childcare vouchers and season ticket loans. But even here there are some surprising perks. Among the magic circle, for instance, you’ll find firms matching pension contributions by as much as 10% or more.
And on the more creative side, firms are working hard to beat the competition with more innovative offerings:
The workplace environment. Among the largest firms, subsidised restaurants, on-site gyms and even sleeping areas are not uncommon. Some lawyers might dispute the benefit of being able to take up 24/7 residence in the office, but it certainly makes for a more pleasant environment on the odd all-nighter.
Transport and travel. With many of the larger firms headquartered in London, it’s not surprising that the season ticket loan is a favourite transport-related benefit. But others are improving packages with car allowances, after-hours travel allowances and free car parking. To suit today’s environmental sensibilities, some firms are also offering tax-deductible incentives to purchase bicycles or reimbursements on the cost of using public transport.
Sabbaticals or reduced numbers of working days. Following an agreed term of service, many firms now offer employees the option of an unpaid sabbatical and/or flexible working. These benefits particularly please the work/life balance requirements of a younger generation, and the recession has also proved that such benefits can help both law firms and lawyers survive quieter periods.
Maternity and paternity benefit. The vast majority of firms offer some level of both maternity and paternity benefit beyond the statutory minimum. But with many firms competing to prove that they can hold onto talented women, maternity benefits in particular have become a source of rivalry. It is not uncommon to find firms offering women as much as 26 weeks’ maternity leave on full pay, followed by options for flexible working.
Flexible holidays. The option to buy or sell holiday allowance is becoming more popular. It is usually restricted to four or five days at most, and caps out when an employee has a total of 30 days’ holiday. Many firms also offer an increasing holiday allowance with years of service.
Beyond the benefits listed above, firms are generating their own unique offerings too. One firm that has joined forces with My Family Care, a family-friendly employee-benefits provider, through which it is offering back-up care sessions to staff, including childcare, eldercare and school holiday cover.
This list is long but not exhaustive. There will doubtless be firms offering benefits not mentioned here, from Blackberrys and iPads through to yoga and massage classes. But the point is clear. Where firms struggle to attract talent on the basis of salary alone, benefits are an important differentiator.
Take US and UK firms for instance. On the whole, US firms based in the UK offer higher salaries. But surveys in recent years reveal that UK firms are generally far more generous in terms of the benefits on offer, outstripping US firms on annual holiday allowance, maternity and paternity pay, and flexible working arrangements.
When UK firms suddenly start hiking their salaries to US levels, we’ll know that the benefits are no longer working. But with younger generations increasingly prizing flexibility and work/life balance, it may be some time yet before we see salaries rise at the expense of the benefits boom. CP