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King & Wood Mallesons Modifies Australia Lockstep Amid News of Hong Kong Pay Deal
King & Wood Mallesons has overhauled its lockstep for its Australian partners, as news emerges that the firm's Hong Kong arm struck a five-year deal to ensure partner remuneration remains at pre-merger levels.
The firm completed a lockstep review this summer after the merger between King & Wood and Mallesons Stephen Jaques went live on March 1, with the Australian partnership set to move from its existing rigid 10-year lockstep to a modified system from January 2013.
Under the new regime, partners will be assigned between 30 and 100 points, with the additional scope to earn bonus points up to a total of 130.
The current system sees new partners join the lockstep at 30 points and automatically progress by seven points each year, with "gateway" performance checkpoints at three and seven years.
Partners are set to be allocated their new points between now and the end of the year. Points will be reviewed annually, although changes will only be made every three years.
King & Wood Mallesons global managing partner Stuart Fuller said: "We have modified our partner remuneration model to introduce more flexibility, while still retaining the core elements of our lockstep structure. The amended model is supported by an improved partner review and feedback process."
It has also emerged that legacy Mallesons Hong Kong partners struck a pre-merger deal with the firm to ensure any disparity in profits between them and their Australian counterparts will be made up by the firm over the next five years.
The firm operates as a three-partnership Swiss verein in China, Hong Kong and Australia, with Hong Kong the only financially integrated arm.
The review has also seen the firm discontinue its early retirement scheme for new partners. The scheme, which allowed partners to retire at 55 and receive 1 1/2 year's drawings every year for the next five years, had been introduced to reduce the number of partners at the top of the equity.