Stars of the north

The in-house legal scene in Manchester and Leeds is thriving, despite concerns about recent salary hikes in the south. Paul Hooper talks to lawyers in the north west and finds that they wouldn’t want to work anywhere else

Ann Page sits in the Co-operative Bank’s headquarters in the northwest of England and contemplates the huge salaries in London’s private practices with barely a scintilla of envy.
As the bank’s head of legal – in charge of a 14-strong in-house team based in Manchester – and the next chair of the Commerce & Industry (C&I) Group, she knows that she is the ‘poor relation’ of her City colleagues. But she wouldn’t change jobs.
And despite losing one of her team to the private sector only a few days ago, she remains confident of recruiting top people.
“If my management team and I wanted to go into private practice then we would be welcomed with open arms, but we all like being in-house.
“But I am here at the Co-operative Bank because I think I have the perfect job. It is a great organisation based in a great area and I work with a fabulous team.”
Page’s sentiments are echoed by many of the northwest’s in-house legal heads, who, despite lagging behind in the salary stakes and each day facing the prospect of losing bright ambitious lawyers to the private sector, are loathe to take the M6 south for more money. Justin Ribbons, head of legal at Manchester-based United Cinemas International (UCI), says: “I always wanted to move in-house ever since university. I believe it offers challenges and opportunities beyond those available in private practice. It has always excited me and I have never had any regrets.”
UCI, which develops multiplex cinemas, has 70,000 employees worldwide – 100 of them based in the northwest.
Attracting top recruits to the region has not been a problem for the team. “In-house lawyers at UCI need to be bright and adaptable to slot into the existing management team and work in a fast-moving environment on an international stage,” says Ribbons adding that the package offered by the company competes well in the market, and that lawyers are enticed in-house by the quality of the job.
“We offer an attractive package. The work is varied and our lawyers are encouraged to become a part of the business team driving the business forward. Our recruitment is helped because we are in a sexy industry, dealing with films and have Paramount and Universal as our parent companies,” he says.
In addition to his regular functions,
Ribbons also oversees human resources worldwide and is head of business affairs.
He adds: “I love the fact that I get to develop and use skills I probably would not have used in private practice.
“A lot of the senior executives in the US come from the in-house legal functions. Because of the relatively recent development of the in-house legal function in the UK you haven’t seen a lot of senior executives in general management roles being drawn from the legal sector, especially when compared with the finance sector.”
However times are changing. Ribbons predicts that as the in-house side of business grows, an increasing number of executives are coming out of the legal functions and moving into general management.
Ribbons is convinced a legal training is beneficial to business.
He says: “A lot of people like the discipline that lawyers bring to projects. They can capitalise on their knowledge of the fundamentals of business and of problem solving to move into more general roles. I think that can be very positive in helping the business develop.”
But despite the many plus factors working in the region brings, many legal heads admit they look at the massive hikes in salaries in the south with growing concern and many are aware of the growing costs of replacing top staff.
Ian Stewart, general counsel and company secretary at CIBA Speciality Chemicals Investment, says: “Although I have not done any recruiting for two years, I am obviously concerned at the significant hikes in salaries for young assistant solicitors in private practice, which tends to be the hunting ground for in-house positions.
“This is potentially a great problem for us because most companies do not make a special case for their in-house lawyers. They do not have a special kitty to pay vast additional sums for their in-house legal staff.
“We tend to be paid at the same level as managers in other functions of the equivalent level. For many years that worked quite well – you were never going to earn sums like you do in private practice and you accepted that when you came in-house.”
He adds: “The great advantage for many is that they can lead a balanced life – although I am not saying that we are work-shy. “But the excessive demands, particularly on assistant solicitors in private practice and young partners leads many to question whether they want to devote so much of their time to work.
“Many highly successful people in private practice earn by in-house standards a huge fortune but they do not really have a great deal of time to enjoy their wealth.”
He says another reason many prefer working in the in-house sector is the challenge of working as part of a team.
“A team of people devoted to the business of the company – rather than going from one client to another as in private practice – is attractive. Plus, you never really feel involved in the business of your client in private practice. For some people, and I include myself, it is more satisfying working for one employer that you personally believe in and with whom you can identify with what they are doing.”
Denise Jagger, Asda’s company secretary and general counsel, also believes that recruiting top quality staff is not too difficult. She says: “I believe this is because we are a good company to work for and we recruited two people to our legal team last year without a problem.”
She adds that Asda is aware of the salaries offered in the private sector and ensures it competes to attract good lawyers.
“I think the package we offer is pretty good, with share options, bonuses, health and car or cash offers. I have never had to advertise twice for any post and we ensure that they have had a very good grounding before they come here.
“Of course what we have seen happening in London is undoubtedly pushing up salaries here. We are aware that to attract the best people we have to offer good salaries. But there are also other advantages in that as an in-house lawyer you are more in control of your workload, you are very much your own boss and the work varies.”
The route south is also a journey that many in-house teams are reluctant to take when sourcing external work – many believing they get a much better service in the northwest.
Regional charges are often between £50 and £60 an hour cheaper that in the City – but most do not believe it means they are offered a poorer service.
Mark Stirzaker, British Vita’s head of legal, says: “Most of our external work is done in Manchester and that is because of the quality of work and also costs. We would not use regional firms if the quality of work wasn’t here, but we have found that it is.
“Of course, the hike in salaries is pushing up costs but I haven’t contacted London firms to find out what they are charging” He says that charges naturally depend on the work but they tend to charge on a job basis rather than an hourly rate basis. “Hourly rates are only appropriate for us on the small amount of litigation that we do,” he says. “We tend not to price it that way. Most of our deals are not in London so it makes sense using local firms.”
UCI’s Ribbons agrees: “In the UK, we have always looked to north west firms for external work.” He instructs primarily DLA and Eversheds. But some of the more specialist work is still done in London, mainly by Denton Wilde Sapte (for banking/competition advice) and by Baker & McKenzie.
“Fees are a factor,” Ribbons says, “but I believe that good advice usually pays for itself and what is important is making sure the company gets the best advice from the best people.”
For the Co-op’s Ann Page, it is a case of shopping around for the best deals – and she is prepared to use City firms for certain transactions.
“We have five or six major firms of solicitors in Manchester who we have dealings with and with whom we have reciprocal business relationships,” she says. “We also have half-a-dozen medium-sized firms. The corporate banking transactions will go direct from the corporate banking team. The same with the property transactions. I am consulted from time to time and kept up to date.
“We have been very active this year in choosing external advisors but we already have a framework there because I have been here 12 years and in that time I have built up knowledge of Manchester,” she says, adding that some work will always go to London.
“For example, if we get a major corporate transaction and we are dealing with a merchant bank then that would go to Simmons and Simmons irrespective of whether there is the calibre of lawyer up here.”
But Page is conscious that her employers are anxious that the company gets the best deal available.
She says that fees are a factor in making these decisions but they are looking for value for money. If they are not happy with costs then we will have a dialogue with them. She always insists on getting a quote. “We certainly feel that we get much more partner attention in the northwest than anywhere else,” Page says.
A ‘successful mix’ of firms including Eversheds and Slaughter and May does Leeds-based Asda’s external work.
Jagger says: “Of course we take into account the fees charged both regionally and in London. It is utter rubbish to think that all the best firms are in London because they aren’t, and regionally, the quality of work is excellent.”
She says the company would use Slaughters for “certain transactions” because they were “extremely good” but turn to other firms for other work.
“It is very much horses for courses,” she adds. “There are certain things I probably would not go to a regional firm for but general work they are extremely good at.
“Rates charged in the region do vary and it doesn’t surprise me that they are differences because you can’t just decide on hourly rates. Some good firms can do the work in half the time. If you get an expert, of course you expect to pay more. It is also important to know that they are not wasting your time. All these things are important in making a decision.”
CIBA Chemicals also prefers to look locally for external advisors. Stewart says: “We try to keep all our external work in the northwest if we can. That’s partly a question of fees and partly a question of accessibility. Despite the fact we live in a virtual world, with e-mail and so on, in any significant transaction you normally want to meet those you are working with and it is easier to slip into Manchester than to go down to London.”
He also prefers to ensure a good working relationship with outside lawyers.
He adds: “I never instruct a firm, I always instruct people. You may work with a team of people if you instruct a partner – and although they may not do all the work, if you know and trust that partner then you also know that if there are problems you can talk to them.”
But he believes that the difference in charges is not an important factor when sourcing external work.
He says: ” Of course a lot depends on the nature of the transaction. Average figures depend largely on what the transaction is. But they are not so far behind London – £250 an hour for a partner and somewhat less for assistants.”