Articles From the Team

Promotion but no pay rise - an increasingly common dilemma

What would you do if you got promoted but didn’t receive a pay rise?

Increasingly, I’m working on Head of Legal and Sole Counsel positions where the employer seeks to hire a relatively junior (4-8 years’ PQE) solicitor to fulfil their department head requirement. In taking this course of action, the employer creates some interesting dialogue and debate regarding the appropriate salary when factoring in a lawyer’s existing PQE, experience and suitability.

In making a decision about who to recruit, an employer typically considers an applicant’s experience, cultural and personality fit, and cost. Not all employers automatically opt for the person with the most experience and in a good number of cases, employers seek to recruit individuals who will grow and develop into the role – in the hope that the developmental nature of the role will keep the employee engaged and fulfilled and increase the amount of time they stay in the post.

When an employer is looking to promote an employee, they undoubtedly consider the person’s current experience and the amount of learning required to fulfil the job’s criteria. On occasion, a promotion for an existing employee doesn’t automatically include a pay rise. The employer looks for the employee to show will and to display the qualities required for the role. A pay rise follows a successful probation period; after the employee’s proved themselves. In other situations, a small salary increase is initially provided with a further uplift on successful completion of the probation period.

It’s when an employer is considering an external candidate for a more senior and/or demanding role - than their current job - where my recent experience is most applicable. Typically, external candidates don’t move for less money and in some cases, such as when people perceive themselves to be significantly underpaid and/or they’re applying for a role with greater responsibility, the figure required creates a difference of opinion. It’s these varied opinions I want to discuss in this blog.

Employer perspective

As alluded to above, when employers hire a developmental candidate they are often doing so because they’re looking to hire someone who will grow into the role, and perhaps also develop their skills in line with future company growth and expansion. 

When an employer is hiring someone who is not the finished article, I often hear from hiring managers that they’re unwilling or are unable to pay the full market rate, at least at the outset. 

Employers hire and pay on the basis of experience and so applicants lacking certain key skills should not expect to be paid the same as someone who is the finished article. Time and investment from the employer afford inexperienced candidates/employees the opportunity to broaden their skill set and to ultimately become more capable and useful to the employer. Taking a chance on someone less experienced means that employers are disinclined to frontload their salary and rewards, instead favouring a carrot (not stick) approach which sees greater reward coming as the employee grows and develops. 

Other employers limit the starting salary of inexperienced individuals stepping up on the basis that the full salary would raise expectations about their experience and abilities. The employer is trying to protect the new starter by bringing them in at a level whereby the key stakeholders won’t expect the world, or indeed the same level and quality of legal advice as to their outgoing and experienced employee, if applicable. 

Candidate lawyer perspective

When an individual is offered a more senior role (or internal promotion) they’re assuming greater responsibility and a higher level of personal risk. This can come in the form of more complex work, greater involvement in business strategy and direction, staff/team management, interaction with more senior stakeholders and/or assuming new duties (e.g. company secretary, data protection officer etc.) and responsibilities.

How a lawyer approaches a step up in responsibility can vary significantly: the individual’s approach has a huge impact on salary negotiations and whether they secure a job offer and/or go on to accept an offer. Generally, there are two schools of thought, which at a rudimentary level follow the expression ‘jam today or jam tomorrow’:

Type 1 (‘jam today’ lawyers)

These individuals look to the job title, duties and responsibilities, and approach salary negotiations from the following point of view: salary is reflective of the role responsibilities and duties, and in line with that, it should be the same as similar roles, irrespective of the individual’s actual experience. These individuals recognise the benefits to their career in assuming the role, however, they feel the employer should pay according to the responsibilities and personal investment that’s required. It’s less about the existing experience and more about the job you’re being asked to do – if the client’s confident enough to make them an offer then the ‘jam today’ lawyer feels an employer should pay the going rate. If not, the message is: the employer doesn’t value you enough.

Type 2 (‘jam tomorrow’ lawyers)

These individuals are happy to buy into the employer’s perspective: inexperienced developmental candidates/future employees may see a small and immediate rise in pay with greater reward on the horizon; once they’ve gained the skills and experience and proved themselves. These individuals recognise the investment and the opportunity afforded to them and are accepting of the fact the employer is providing a platform and an opportunity to gain skills and valuable experience for the longer term.

Thoughts

A candidate lawyer who’s offered a step up in responsibility and duties will quite understandably take the view that they should be paid commensurate with the job title and duties of the role. Conversely, it’s to be expected that an employer, keeping a watchful eye on expenditure and costs, will take the view that an unproven and inexperienced candidate should not expect to be paid the same as someone who’s the finished article, and therefore, a potentially safer bet.

In my opinion, the question of pay versus role responsibilities and experience is not straightforward to answer. While I have sympathy for the view that employees should be paid for the role they’re undertaking, I agree that the opportunity to gain new skills and experience is valuable in its own right.  If an employer’s willingness to invest in you, particularly if you have little or no experience of certain duties – i.e. a Senior Solicitor moving up to Head of Legal – you seriously need to consider the long term benefits to your career. Having the new job title, knowledge and skills can be instrumental to your career and future prospects.

As a legal recruitment consultant, I try to tread a fine line between the client’s needs and the candidate lawyer’s aspirations; however, my role provides me with a unique view of the legal marketplace. In short, I have a visual landscape of the majority of the North West in-house legal market and I often work to many similar recruitment processes.

I always seek to secure a candidate lawyer with the best offer possible, however, I do so by taking into consideration what the employer is telling me, and knowing how far we can ‘push’ the hiring manager. In instances such as the above, where a client is unable or unwilling to go beyond a certain level due to a perceived lack of experience, I recommend a candidate lawyer looks beyond what’s on the table. Your legal career is more like a marathon than a sprint, so taking the longer term view of ‘jam tomorrow’ is often the most sensible (unless you’re particularly poorly paid: behind the market).

Developing as an in-house lawyer is all about gaining skills and experience to allow you to advance to the next level. To become a General Counsel you need to have varied legal experience, ideally gained in multiple roles, companies and/or industry sectors; ideally, you’ll have management experience and strategic involvement in business decisions; you may also be required to have company secretarial, data protection and other compliance or governance experience and knowledge.  

Finding employers who are willing to give you a chance to gain new skills and experience is vital, and in some cases, this belief and investment in you may come at the expense of a market-leading salary for the specific role, at least for a time.