Imagine the scenario. You are an experienced lawyer with a busy caseload. You’ve watched friends and colleagues sitting in the sun receiving 80% of their wages for doing nothing, while you have continued to work, perhaps on a spare table in your bedroom. You’ve answered client’s calls, billed as much as you can and now, as a reward for your loyalty, your employer is looking to reduce your pay. What do you do?
Law firms are struggling with the continued impact of COVID-19 and there are numerous reports of redundancies, office closures, pay cuts and 4-day weeks. The partners may believe that a pay cut will ensure the firm’s survival, but can you afford to lose a fifth of your income?
As a lawyer, you’ll know that if your employer unilaterally imposes a pay cut without your consent, it will be a breach of contract. But what if the firm is threatening to dismiss you if you don’t agree?
Here are a few options on how to approach this:
- Ask for detailed reasons as to why the pay cut is being made and find out who else is affected. Is it firm wide or just certain departments? How long will the pay cut last?
- Check what other cost cutting options the partners have considered. Increased working from home for instance, or the use of a legal platform to substantially reduce insurance, compliance and other overheads
- Consider accepting the pay cut if you get something in return, ie extra holiday or a bonus if the firm returns to profitability
- Raise a grievance explaining why you believe the pay cut is unfair.
- Comply with the new terms but work "under protest" and claim for breach of contract or unlawful deductions from wages (known as "standing and suing")
- Resign and bring a claim for constructive dismissal. A substantial pay cut is likely to be a fundamental breach of contract which would allow you to bring a claim if you have more than 2 years’ service
- Refuse to work under the new terms. If the firm dismisses you as a result, you may be able to bring a claim for unfair dismissal and, if the dismissal was without notice, wrongful dismissal.
You may well be thinking that now is not the time to rock the boat. Safer to sit tight, accept what is thrown at you and look to move on when things get back to normal, whenever that is. Fair enough, but there is another option.
It’s radical, it takes guts but it’s 100% worth it. Join a platform law firm or fee share model where you will have the freedom and support to achieve your ambitions in a way that suits you and your clients. You will be able to run your own practice without worrying about insurance, compliance, accounts rules. All that will be handled for you. All you need to do is keep your clients happy.
And if you are able to show that your employer has breached your contract, any restrictive covenants will fall away and so you will be free to contact the clients you have been working so hard for over recent months.
The challenge facing certain sectors was brought into focus today as a leading player reported work volumes are still only half those enjoyed before the pandemic.