Trowers & Hamlins has frozen pay for associates and business services staff as a result of uncertainty in the wake of Britain’s decision to leave the EU.
Staff and fee-earners were informed of the decision at the end of last month in an email from senior partner Jennie Gubbins.
It is understood that equity partners’ drawings and bonuses will go ahead as normal, while salaried partners received their annual pay rises in March this year.
Gubbins revealed pay reviews for everyone else had been put back for a second time following the Brexit vote and a final decision on when reviews would take place will be made at a management board meeting on 15 September.
In the internal email, which was leaked to blog Roll on Friday, Gubbins said the firm had “decided to put in place a number of precautions to ensure that the firm is better able to withstand any bumps there may be in the road ahead”.
She added: “While we can’t predict the future, I think we can safely say that uncertainty is likely to continue over the next few months until there is more clarity around the direction of negotiations for our withdrawal… Please be assured however that early indications enable me to be cautiously optimistic that we will not be too badly affected.”
Gubbins ended her message by asking fee-earners and staff to “please take every opportunity” to “reassure” clients in the Gulf and Far East that the “UK is open for business”.
Trowers saw a dramatic turnaround in its Middle East and Asia fortunes in the last financial year, with its non-UK financial results showing profit climbed by 1800 per cent to £1.9m. The growth signalled the firm’s international practice bouncing back from a devastating decline in 2014/15 when profit dropped 96 per cent from £1.25m to £100,000.
Trowers is the latest firm to freeze pay as a result of Brexit uncertainty. Addleshaw Goddard postponed pay reviews for all classes of partner and associates this month, and also put back equity partners’ autumn quarterly drawings until later this year.
Gowling WLG has also delayed its annual pay review for both lawyers and staff, with management promising the firm it will “confirm in the autumn” what the outcome of the review is. Any changes made to salaries as a result of the review will be backdated until 1 July.
Meanwhile Simmons & Simmons has begun making redundancies to its real estate team in London as a result of restrictions to the market following Brexit.
A spokesperson for Trowers declined to comment on the contents of the leaked email.