Editor's blog | Trainee remuneration and the competence tipping point

Abolishing the minimum salary for trainees wouldn’t be such a terrible decision if the market wasn’t so saturated with skilled lawyers chasing fewer jobs in a distinctly unfavourable economic ?climate.

But first, let us clarify one point: the SRA hasn’t decided to scrap the concept of a minimum wage for trainees. It has decided that it should be the same as other workers. The resulting drop of more than £7,000 in annual earnings will clearly be a significant loss, the effect of which shouldbn’t be underestimated. But that’s not the same as saying that there should be no minimum wage for trainees at all, or that trainees should be treated on a par with apprentices and paid £2.68 per hour. In fact, the SRA has said it would lay down specific rules to prevent the latter.

Many of the responses to the board’s – unanimous – decision have, rightly, focused on its impact on diversity and the obstacles it will put in the way of aspiring lawyers from under-represented backgrounds. At a time where the profession is endeavouring to promote diversity, this will be a blow across the board. Not just in relation to defined or protected groups but for any individual from a less privileged background – university graduate or mature student – considering a career as a solicitor.

Now, the SRA is perfectly entitled to reach the decision it has. The concern is the process followed for the consultation, which has resulted in accusations that the regulator rushed through an outcome it had already determined. The explanation that there didn’t appear to be a clear majority among respondents in favour of keeping the minimum wage shouldn’t necessarily have led the SRA to conclude that it should therefore be brought down to the level of the general minimum wage.

There will have been understandable pressure from law firms to reduce the burden on their finances, but, all the same, it was an extraordinary decision on the part of a regulator otherwise keen to assert its independence. Even those with a sunny disposition are left clutching at straws. Several board members agreed with Northumbria University’s pro vice chancellor Lucy Winskell that there were “other, better, ways of dealing with the issue of diversity in profession”. Quite what these are wasn’t discussed. These should, in all probability, surface as part of the research undertaken for the Legal Education and Training Review, but an early indication of the SRA’s thinking would have gone a long way to quell concerns.

Diversity, however, is only one aspect. Perhaps more worrying is the possibility that this will lead to a two-speed training pathway.

There are lots of bright graduates out there who would make competent lawyers. Only the exceptionally bright will have access to finance, with City firms continuing to offer funding for the LPC and paying well over the average UK salary of £26,100 in 2011.

A middle section of medium-sized firms – in the main, larger regional firms – will probably be prepared to pay decent wages to ensure they remain attractive employers locally.

Then will come a tipping point, as one senior City lawyer described it to me, beyond which law firms will take advantage of the new rules to pay no more than the minimum wage.

And everybody knows what you get when you pay peanuts. Whole swathes of trainees could be contracted as cheap labour with little sense that firms will regard them as part of their development plan. No doubt some of them would survive these Dickensian conditions but the danger is a wholesale drop in competence standards outside the Top 200. It could affect the future not only of individual lawyers and law firms but also that of the whole profession. And not just that: clients would ultimately suffer, with a quality of service that could collapse to - whisper it - sub-standard levels the profession has associated with new entrants.

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Jean-Yves Gilg is editor of Solicitors Journal (jean-yves.gilg@solicitorsjournal.co.uk)