Allen & Overy’s (A&O’s) decision to cut the equity points of its project finance partners did not apply to the whole team, it has emerged, as evidence grows of the magic circle firm ushering in a modified lockstep through the back door.
A&O conceded that it had moved partners in the projects team down the equity ladder earlier this year. However, Legal Week has learned that factors such as individual partner contributions also affected how each partner was treated.
Projects head Graham Vinter is understood to have retained his original equity point status, although the firm refused to comment on individuals’ compensation.
A&O said the re-weighting of the partners’ equity came as a special exception to its lockstep, citing the impact of sterling’s strength in a practice area dominated by dollar-billing.
The move comes as it emerged this month that the City giant is edging away from strict coherence to its 15-year lockstep to promote lateral hires up its equity ladder, including former Norton Rose partners Tim Polglase and Robin Harvey.
In December 2005 the A&O partnership authorised its management to move lateral partner hires up the equity ladder on a discretionary basis.
One partner at a rival firm said: "If I was a partner who had come through the ranks at A&O, I would be really annoyed."
However, one A&O partner responded: "The decision was widely discussed and we all knew it was coming — it is strongly supported, as the payment of lateral hires may not be a reflection of their current performance."
News
A&O edges in managed lockstep pay shift
Published: 18/05/2006 00:00
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