Law firm Osborne Clarke is reducing the pay of employees earning over £30,000 by 7%, from 1 June 2020.
The pay reduction, which will be in place for 11 months, will be capped at £30,000. Employees who will earn less than this threshold after the 7% reduction comes into effect, will receive a higher percentage of their salary. The organisation will also delay pay reviews.
Employees who are affected by these reductions will still retain all of the existing benefits offered by the organisation, with pension contributions being paid in line with their unadjusted salaries.
Furthermore, Osborne Clarke has confirmed that if it hits its financial target for 2020/2021, it will begin to repay employees the salary reductions they have incurred.
The organisation is also offering employees the opportunity to take part-paid sabbaticals, early retirement, a reduction in hours or be part of a job share scheme.
Additionally, employees who are furloughed until the end of May 2020 will remain on the scheme until the end of June 2020.
A spokesperson from Osborne Clarke said: “While there are encouraging signs that the pandemic is abating in the UK and in some of our international markets, normal economic and business activity is expected to remain subdued at best, throughout 2020, and possibly beyond.
“We announced in April [2020] that UK partners would defer 75% of their special draws while also proceeding with long-planned additional capital contributions. From 1 June [2020], they will also be subject to a 10% cut in their monthly draws (essentially their salary) for 11 months.
“Following consultation, we are also taking the unfortunate but prudent decision to reduce some staff pay by 7% from 1st June [2020] for 11 months. This will apply to all staff earning £30,000 FTE [Full-time equivalent] gross and above. Anyone who would earn less than this after the 7% deduction will have their pay reduced to £30,000 FTE, no lower. A decision on 2020 pay reviews has already been deferred to the autumn.
“The partnership would once again like to thank all our employees who are continuing to work so hard both for the firm and our clients during this very uncertain time.”