Herbert Smith redundancy payout details emerge

Herbert Smith associates laid off in the firm's current consultation will receive a better redundancy package than initially expected.

Lawyers taking voluntary redundancy will receive three months' notice in addition to three and a half weeks' pay for each year of service, with everyone receiving a minimum of ten and a half weeks' pay, irrespective of how long they have been with the firm.

The terms, revealed by legal website RollOnFriday today (1 May), are more favourable than expected given that the top 10 firm's staff handbook stipulates it will pay just two weeks' salary for each year of service.

The deal means a newly-qualified lawyer who trained at the firm will receive £27,100 in severance pay, while those with one-year post qualification experience (PQE) will receive £30,700, two years PQE £36,900 and three years PQE £48,700.

Lawyers subject to compulsory redundancy will also serve three months' notice but will only receive three weeks' pay for each year of service, with no three-year minimum payout.

On these terms, a newly-qualified lawyer who trained at the firm would receive £21,900, while lawyers with one year PQE will receive £28,800, two years PQE £34,100 and three years PQE £44,700.

Laid-off support staff are thought to be receiving similar packages, although notice periods are understood to vary from one to three months depending on seniority and length of service.

Details of the packages, which are still under consultation, follow the City firm's announcement last month (20 April) that 84 positions were facing the axe in London, including 30 fee earners.

The firm's corporate practice is expected to lose up to 24 fee earners and professional support lawyers (PSLs) as well as nine paralegals, while the firm's real estate practice is likely to lose nine fee earners and PSLs.

In addition, up to 42 secretarial and support staff roles have been placed under threat.

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