Francesca Griffiths is a trainee solicitor at Lindsays Solicitors, who specialise in medical negligence. Here she takes a look at the scrapping of the minimum wage for trainee solicitors, due to come in to effect in 2014.
The Solicitors Regulation Authority last week voted to scrap the minimum wage for trainee solicitors and to implement a salary in line with the national minimum wage. As a trainee solicitor with only a few months to go until I qualify I have observed the debate for and against the scrapping of the minimum wage with interest. I have read a number of opinions reflecting both sides of the argument and I am surprised at the number of people who have waded into a controversial argument with little insight into the reality of being a trainee solicitor in 2012.
Without immediately diving in head first with an outlandish comment as to whether the scrapping of the minimum wage is deplorable or not, I think that the financial path leading up to becoming a trainee solicitor should be examined.
All trainee solicitors must have first completed a minimum of three years at university and then proceed on to complete the LPC. For courses starting from 2012/ 2013 universities and colleges can now charge new full time students up to £9,000. In addition to living expenses and the costs of funding the LPC (which is in the region of £8,000 to £12,900 depending on the provider) those completing the overall academic process are looking at graduating with a debt of between £25,000 and £50,000. I suggest that if you talk within your circle of friends it would hard to come across someone who has escaped from university without the wrath of debt.
So for a law graduate completing university with at the very least a debt of £25,000 (or indeed the prospective law student contemplating their career), what are the advantages and disadvantages of the scrapping of the minimum trainee wage?
The ever saturated job market
The argument supporting the deregulation is that the abolition of the trainee minimum wage would allow for more training contract opportunities. We are all aware that the current job market is saturated with graduates desperate for jobs and the argument is that those currently working as paralegals on a lower wage would be allowed more access to training contracts as firms would be able to finance more training contracts. Or indeed firms would be able to offer training contracts from the outset without first expecting LPC graduates to work as a paralegal (a relatively new phenomenon).
The minimum salary at present is £16,650 for first year trainees. By reducing the cost of a trainee’s salary to £11,065 this would “save” a firm £5,585 per year. Therefore for every two training contracts awarded this would seemingly allow for the creation of another training contract vacancy.
However, is this economically realistic?
Most firms will have to factor in the costs of additional trainees, such as ensuring there are enough fee earners / training principles to assist, PSC fees and overheads such as increased insurance for an expanding workforce? From my point of view the amount that firms would “save” on reducing trainee salaries they would then spend on additional costs. This may lead to firms lowering the trainee salary with the idea of offering more contracts but then realising actually they are not in a financial position to do so. This would therefore not solve the issue of too many paralegals and in reality would put paralegals / trainees in the position they are currently in, except now poorer.
For richer for poorer?
One of the arguments in criticism of the deregulation is that only the rich will be able to enter the legal profession and those with passion but fewer pennies will be barred. The cold hard facts are that when broken down a trainee would receive £823.88 per month for two years. If you all take a second to observe your own financial situation the key question is whether you would be able to survive on this salary for two years without the help from a parent and/or spouse? ANSWER HONESTLY!!!!??
Using my own financial situation (gulp) as a case study I would have to conclude, no. My current basic outgoings per month are £350 rent, £50 phone bill, £50 car insurance, £40 petrol (just commuting to and from work), £56 council tax, £10 car tax, £10 medical fees and £100 in utility bills. This would leave me with £157.88 per month for food, clothes, hair extensions, car repairs / petrol costs and additional expenses which as we all know are ever increasing. I am in the fortunate position of having no student loan to repay however I would presume that the majority would also have to factor this in.
”MOVE HOME IF YOU’RE SO PASSIONATE ABOUT PURSUING LAW?”
I hear the supporters of the abolition cry. I am in the luxurious position of being able to do so. I doubt that many others are. If I had mortgage repayments, an inability to rely upon my parents/spouse, wanted a career change, had any dependants, the minimum salary would bar me financially from entering the legal profession irrespective of my passion and drive to work in the clinical negligence field. Sadly passion and drive does not pay the bills and in my opinion the SRA have now blocked access to becoming a solicitor for high calibre candidates who are in a less fortunate financial position.
I suspect many of you will agree that nurses are underpaid for the work they do and that many of them stay with the profession because of their “passion” for the job. That doesn’t make it right! Agreeing to be paid less than the going rate for a university graduate with a professional qualification because to do otherwise shows a lack of passion is giving licence to employers to offer as little as they can on the basis that only those with “real” commitment are willing to work for the national minimum wage. As I said, you might be willing do it, but it doesn’t mean it’s right!
What are you worth?
I am aware that another argument is that no other professional regulator sets a minimum wage. This is simply untrue. The first example I can give is that the Department for Education has set a minimum wage for a newly qualified teacher which states that their starting wage will be no less than £21,588. The NHS has also set bandings for those who qualify as doctors and nurses. The minimum qualification salary for a doctor is £22,412.
The Guardian stated that the average salary expected for graduates in 2012 was £26,000. This again is in contradiction to the claim that in times of austerity graduates should accept low wages as the norm. Clearly it is an argument aimed at law graduates to encourage them to accept that this is the norm when it is not. Trainee accountants are offered between £16,000 and £22,000 per year and trainee opticians are offered between £18,000 – £22,000 in a similar climate of economic squeeze.
I hope you all agree that those with aspirations to become solicitors are intellectual and professional individuals. Are four ( maybe five) years of academic application and study in addition to further years gaining experience in the field mean that your value to a firm is only £11,065? I feel that this view will discourage younger generations from pursuing a career in the legal profession.
Although I have only discussed a number of arguments for and against the scrapping of the minimum trainee wage, my opinion is that scrapping it is not a forward thinking step for our industry. I fear that it may lead to candidates being sidelined in favour of those who would be able to afford a career in the legal field.
I think that those making and favouring the decision have not considered the financial impact on our future trainees and if that salary had been applicable when they trained as solicitors would they have entered the profession? Sadly I think that this is a case of those that went before us cutting the rope up that they climbed.
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