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Shardul Amarchand amends 3-month salary clawback to apply only to fraction of pay (if not leaving for in-house or ill-health)

After amendment hand-cuffs half open (or still half closed)?After amendment hand-cuffs half open (or still half closed)?

Shardul Amarchand Mangaldas has relaxed its earlier controversial policy under which it could claw back up to three months’ remuneration from fee-earners, clarifying that only the difference between standard remuneration and “enhanced” remuneration over three months would be “returnable” (and only if lawyers join a rival law firm).

In the words of an email sent by the firm to lawyers today, “the claw back only applies to the special fee enhancement and not the total annual fee”.

Or, in case that’s not clear, in yet other words: lawyers would just be liable to repay an amount equivalent to three months’ of the base pay hike itself.

This would significantly reduce the amount theoretically re-payable by leaving lawyers to very little, as the amended policy would likely also exclude the potentially much larger variable or bonus payment and would only consist of the difference between the standard monthly base pay and the so-called one-time “special fee enhancement” to base pay.

It is understood that for the period from 1 September 2018 to 1 April 2019, monthly base retainer pay was “enhanced” by amounts from around 10% upwards, while the variable annual bonus amounts were “enhanced” to a much greater extent in most cases.

The original policy was first reported by us on Wednesday.

It had been controversial for - on a standard interpretation - requiring lawyers (including non-equity partners) to repay a full three months of hiked remunerations to the firm, if they resigned the firm anytime before 1 April 2018 (see clause below).

However, earlier today, co-managing partners Akshay Chudasama and Pallavi Shroff have sent the following email to the firm:

We are writing to address certain misunderstandings which have been brought to our attention:

1. Two staged increments - In addition to the annual fee enhancement that we pay out, we have rolled out a one-time special fee enhancement to reward all our teams, recognising their commitment, dedication and high service standards.

2. Claw back — the claw back only applies to the special fee enhancement and not the total annual fee. It is the pro-rata additional amount (i.e. the difference between the annual fee enhancement and the special fee enhancement from 1 September 2018 (on a pro rata basis)) that may be returnable. Exceptions to this shall be considered at the management’s discretion e.g. for reasons of ill-health or going in-house. The fee revision letter may be treated as clarified to this extent.

It is clear that with the special fee enhancement and the variable pay policy of our Firm, this is a significant increase in fee for all. We hope this resolves any misconceptions you may have and we look forward to seeing you work with renewed enthusiasm and vigour.

The original clause incorporated into retainer amendment letters to lawyers on 5 September had read that the:

enhancement in retainership fees is conditional upon completion of a minimum of 7 months as a retainer with the Firm from September 1, 2018, failing which, three months retainer fee will be payable to the Firm within 30 days of resignation or on the agreed last working date

We have reached out to the firm for further comment.

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Like +10 Object -90 Haters.... 07 Sep 18, 21:16  troll?  controversial
It’s been disgusting to see the reactions of everyone to the news story regarding SAMs claw back clause - just nasty stuff that nobody has the guts to say on people’s faces....

If you’ve followed the legal industry are honest about things, you should give SAM the benefit of the doubt. No idiot in their right minds would claim back 3 months salary. This clearly was a miscommunication. But it does demonstrate the insecurity of SAMs competitors as nobody at SAM had raised any objections but the rest of the world was up in arms.

Any ho... SAM has clarified.... end of story!

And btw even if they intended to claim 3 months, rolling it back demonstrates sensitivity and listening to people. It takes a big man to accept a mistake and change.
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Like +72 Object -2 First floor 07 Sep 18, 21:20  interesting  top rated
We agree with you Jamai Raja. No truer words were ever printed on parchment or LI
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Like +18 Object -1 Sac 07 Sep 18, 21:22  interesting  top rated
Guess you are being sarcastic or you are SSS.
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Like +33 Object -1 Lieslies 07 Sep 18, 21:43  interesting  top rated
What a sham explanation !!!.There was no mention of enhanced pay over and above the standard pay, this concept came out of thin air coz all the firm employees became 'baaghis' !! pathetic job at covering up as well !!. Letter only mentions that "one time enhancement" is for the period of 1st September 2018 till 31st March 2019 (7 months), it does not differentiate between standard or enhanced pay. utter nonsense. People are tied to their desks, its just like concept of providing bonus in tranches, to complicate exits.
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Like +2 Object -45 Dumbo 07 Sep 18, 21:49  troll?
Dude.... read the letter
Obviously you ain’t at SAM?!?
Didn’t you get a pay enhancement from 1 April - 31 Aug 2018? And another from 1 sept 2018 - 31 March 2019?
The first was the standard increment which is always announced mid year and paid in arrears. The second was the bumper payment!!
SAM now is the best pay master!
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Like +1 Object -28 Cammie much 07 Sep 18, 21:54  troll?
You sound like a Cammie....
I am a Sammie... and I’m watching my bank balance increase...
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Like +13 Object -1 perfect 07 Sep 18, 22:04  interesting  top rated
absolutely !! its a bizarre cover up and nothing else. Right way would have been to withdraw the earlier letters and issue new ones. But this is another way of keeping the policy alive and an eyewash for media.
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Like +0 Object -0 Clarification 07 Sep 18, 22:07
Kian- it would be much easier, if the policy is explained in detail by a follow up comment to understand the effect of the letter issued today along with the earlier letter. is it possible?

Today's letter is not very clear. just a request.
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Like +25 Object -3 Sai baba 07 Sep 18, 22:01  interesting  top rated
Corp comm must have gone to Shirdi to seek advice and draft the above crap
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Like +4 Object -1 CCD 07 Sep 18, 23:41
Or Puttapathy...
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Like +0 Object -3 Tasteless 25 Sep 18, 10:56
Not cool Man - you should not involve the Divine in human matters - so next Trump makes a move, blame Christ Almighty! SSS is a devotee of Sathya Sai Baba, and if he has found his inner peace by virtue of following his God, then let's be glad for him, and not comment on his devotion or his God.
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Like +9 Object -0 Pedicure 09 Sep 18, 15:15  interesting
The use of the word “misunderstanding” is really funny. So either SAM management cannot draft well or the SAM lawyers are very bad in interpretation. Whatever be the case, this doesn’t reflect well on the firm. SAM think tank would have done better by calling the amendment an amendment and move on. It’s okay to bow down to your fee earners. Shouldn’t hurt your ego.
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Like +24 Object -1 Cover-up 07 Sep 18, 21:17  interesting  top rated
This is the worst cover up.
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Like +10 Object -42 Senior Associate 07 Sep 18, 21:22  troll?  controversial
This is what we all thought it was!
Cover up or not, I now am paid more than my peers at other law firms (barring Trilegal which is a mid size firm in comparison)!
For once I can gloat about being at SAM and earning the salary I do!
AZB, CAM etc the pressure now is on you to increase salaries!!
Next round of drinks on me fellas
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Like +21 Object -2 El Duderino 07 Sep 18, 21:38  interesting  top rated
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Like +14 Object -3 tukdeWaleKutte 07 Sep 18, 21:48  interesting
chamchas may very well plaster themselves to the wall but dare not they say that Trilegal is midsize. Anyways,person like you gets slapped once and now is willing to show the other cheek and the two on behind as well just to suck up to the management. lick lick !
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Like +1 Object -0 Grammar Nazi 10 Sep 18, 00:09
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Like +1 Object -0 Goofball 08 Sep 18, 16:28
"For once" indeed
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Like +13 Object -1 green lantern 07 Sep 18, 21:24  interesting  top rated
ya ne ke - dugna lagaan. that was shardul yesterday.

the power of the oppressed classes singing in a single chorus on legally india. shardul has rightly retracted his tom alter alter ego and is back to being just a rich and moody lawyer and businessman.
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Like +25 Object -2 Oh hello 07 Sep 18, 21:26  interesting  top rated

If you know even basic english, u would have been able to understand that what is written in increment letter meant three month salary return... the clarification issued is no where clarification... its a complete stepback. It has been issued in garb of clarification but the substance prevails over form..

The managing partners and other partners who shout at associates for basic grammer error should first review what they have written and what it means both in hr letter and todays clarification
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Like +11 Object -0 El Duderino 07 Sep 18, 21:35  interesting
Kian - Brilliant job on the photos for the both the articles man.
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Like +5 Object -48 Corp Comms Triollers 07 Sep 18, 21:43  troll?  controversial
The almost 200 comments on the first article are all the job of the Corp comms team at a competitor.
Their mission:
Target SAM
Target Jamai Raja

Mission failed.
Hardly anyone within the firm was complaining about the claw back.
Jamai Raja cares more about the firm being non-family run than the non-family partners! He’s a dude who is an excellent competition lawyer, a food Instagram star and an overall baller!
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Like +12 Object -2 puchpuch 07 Sep 18, 21:52  interesting
puch puppy dance...*puppy dancing*...such chamchas i tell you !!
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Like +8 Object -0 sarci 07 Sep 18, 23:57  interesting
If only sarcasm could kill
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Like +20 Object -0 SAM-ki-Jai 08 Sep 18, 02:35  interesting  top rated
While yesterday bar & bench reported that the increments are between 20 to 70 Percent, SAM itself is saying today that the increment offered is in some cases as low as 10 percent. How is this a"bumper", "one time enhancement". SAM is resorting to wordplay to cover up the mess. the increments offered are not as high as they are projecting it to be. Despite teams meeting your target, many associates have been offered an increment of about 9.4 percent. SAM is nowhere near the best paymaster. It's appalling to see that it wants to project itself as one.

Please stop this. It's sickening to read
anyone defend SAM's stunt. The whole exercise is an eyewash.
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Like +5 Object -2 Insider trading 08 Sep 18, 11:44
Khansaheb's disgruntled army...they were already getting high salaries.
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Like +3 Object -17 Obvious 07 Sep 18, 21:48
This is what a lot of us had thought it meant, before we read the legally india article. This also makes a lot more sense andnis definitely more likely to be enforceable (The amount of LD being significantly lower)

Even otherwise, It’s great that they were sensitive and made the change based on reactions (whether outside or inside).

Also, don’t understand where the exception for rival law firms in your first paragraph is coming from. It seems like you will only lose the additional increment even if you go to a rival law firm.
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Like +3 Object -0 kianganz 07 Sep 18, 21:54 LI subscriber
Many thanks, have clarified the first paragraph to reflect that. All the various drafts, enhanced pay, etc floating about were quite confusing :)
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Like +1 Object -20 Kudos to SAM 07 Sep 18, 21:52
Kudos to SAM for swallowing its pride and responding so quickly to criticism. Everyone makes mistakes!
HK Admirer
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Like +10 Object -10 BoomShakalaka 07 Sep 18, 21:53  controversial
Kian - You should disclose if you receive any amounts of funding from any law firms (besides your subscription fee paid by individuals)?? It appears that you have particular pet peeves against certain firms (why I don’t understand since you’re supposed to be neutral as the media) but it appears there is something more we need to know behind why you breaking certain types of stories or slant them a certain way for some firms and another way for other firms!

What’s the truth Kian - THE NATION WANTS TO KNOW!! Be transparent.. just the way you seem to want the rest of the world to be!
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Like +18 Object -0 Gyanchand 07 Sep 18, 21:55  interesting  top rated
Initial clawback proposition and the recent retraction reflect a desperation. Those on the managing committee, SAM's pets in Delhi, are only good at shouting at their team. If those God's own gifts to SAM and mankind could not tell him what the reaction to the measure would be, then how can they be regarded as competent lawyers, more so transactional?
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Like +15 Object -1 coverUP 07 Sep 18, 22:03  interesting  top rated
I think no explanation will help this time. 3 months salary will still have to be returned from the increment of 1st sep till 31st march, 2019. The complexity of these policies make sure that the firm is benefited and employees are not. Opaqueness of policy has been the trend and is not going to end soon at SAM, it seems.
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Like +1 Object -25 Not from SAM? 08 Sep 18, 07:59  troll?
You’re as bad as those who you claim are bad!!
If you were a lawyer at SAM, which you clearly aren’t, and you were to leave, then only the incremental earning after the second fee increase is repayable!!!!
So if you were earning 50 lakhs last FY and it increased - first from 50 lakhs to 60 lakhs for the period 1 Apr to 31 aug (standard increase announced this week and paid as arrears on a pro data basis ie 5 month) and then increased further from 60 lakhs to 70 lakhs with effect from 1 Sept (special increase essentially to make SAM a market leader amongst the top 5 firms) then it’s the 10 lakh increment from 1 Sept that would be repayable on a pro rata basis
Just angry at all these dumb comments by outsider!!!
No I’m not management. I’m not Jamai Raja. I’m an associate who is loyal to the firm that has made me into a good lawyer and am disgruntled at gossip website like this where people who have grudges and axes to grind so whatever crap that is their in their heads.
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Like +7 Object -2 Massage 09 Sep 18, 15:26  interesting
So r u saying that SAM is right in taking back the differential amount? Isn’t the increment also part of the salary? How can taking away any amount from one’s salary be justifiable.
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Like +5 Object -2 Brush 09 Sep 18, 15:37
The only good thing about this whole thing is that atleast they have got the increments. Whereas CAM has not even cared to give an explanation on the delay in increment.
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Like +5 Object -0 Son 09 Sep 18, 15:43  interesting
Let’s stop calling the increment as something phenomenal. Consider this - April to September increment is 10% and October to March increment is 50%. So effectively on an annual basis the increment is effectively 30%. 20-25% increment is not really unheard of. No one seems to be talking about the huge amount that lawyers lost “in arrears” !
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Like +1 Object -0 Loser 13 Sep 18, 10:34
This is so untrue - increment from April to August is mostly 10% and from September to March is 15 !!!! How is that a big number to begin with? Don’t understand this stupid 2 increment theory to begin with
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Like +1 Object -0 Loser 13 Sep 18, 10:32
This comment is really stupid - neither the original numbers nor the increment is remotely close to what it is being quoted
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Like +5 Object -0 Kianmerabhai 07 Sep 18, 22:20  interesting
this post is not clear just like the letter they have released today. Shed some light pls
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Like +15 Object -0 Assocaite 07 Sep 18, 22:28  interesting  top rated
Such a poor explanation was not required. If they had a heart then the entire letter should have been withdrawn as it is. It is highly disrespectful to people.
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Like +1 Object -5 Not from SAM 08 Sep 18, 07:50
Pls go back to office or to Select City Mall.....
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Like +5 Object -0 Kale 07 Sep 18, 22:29  interesting
This is no explanation and does not help people who want to leave or may want to leave. Its complete non sense.
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Like +14 Object -0 noway 07 Sep 18, 22:45  interesting  top rated
Worst part is that now people will have to make more recovery by fleecing more clients since the target got increased and bonus is contingent on 3x recovery of target. No firm has this stupid rule and its known that there is not enough work in the firm to cover targets.
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Like +8 Object -0 shazam 07 Sep 18, 22:48  interesting
this money is not free that is the reality. How to make recoveries is a huge issue now since target also got increased substantially.Variable pay policy should be amended and bonus dependent on recovery should not be implemented anymore.
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Like +1 Object -10 Not from SAM 08 Sep 18, 07:50
You’re obviously not from SAM!
The target issue was dealt with on Day 0 to the satisfaction of all concerned!!
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Like +21 Object -0 Hoho 07 Sep 18, 23:49  interesting  top rated
Did the Managing Partners just admit to bad drafting?
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Like +48 Object -0 Scared Client 08 Sep 18, 00:12  interesting  top rated
A firm's own drafted letter is 'misunderstood' by their own people. What would their clients documents would look like.

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Like +1 Object -0 Majmudar Hirani 08 Sep 18, 00:24
What is the definition of a "rival law firm"?
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Like +4 Object -40 Much ado about nothing 08 Sep 18, 01:16  troll?
Those of us within the firm, and most of you commenting are not, have full faith in the Shroff family. We know they will always do the right thing.
Most of the stupid, perplexed, hateful comments, are from those jealous of the success and market leading position of SAM.
If you only win in trolling SAM on Legally India, best of luck!
We succeed by providing clients top notch service and we get rewarded better than you!
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Like +17 Object -1 Parinda 08 Sep 18, 11:29  interesting  top rated
What was the story about that false affidavit again??
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Like +16 Object -0 Naysayer 08 Sep 18, 18:46  interesting  top rated
One disgraceful incident that was ... Making associates scapegoats
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Like +14 Object -0 Not a present client 08 Sep 18, 11:44  interesting  top rated
Haan Bhai, it is these 'stupid, perplexed, hateful comments' that got the clarification out!
For once, I agree with another post here - if the document was so ambigous for internal staff, what should external folks/ clients make of any draft from SAM?
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Like +2 Object -0 Old Hand 11 Sep 18, 15:17
Dear MAAN,

Its good to see that you have faith in the family. They are indeed very decent people. I know them for 20 years and more. For your benefit- they are good to smart people. They laugh at fools who blindly follow their instructions. Earn their respect by being smart and tell them when they make a mistake. They will respect you. Ask the likes of Jatin and Gunjan.
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Like +2 Object -22 KayC 08 Sep 18, 02:01
The clarification from SAM puts the case to rest. If only this portal and those writing hate comments cared to find the truth it would have saved them plenty of time and heartburn.

SAM's special fee enhancement shows that it values its people and rewards talent. So stay calm and enjoy the weekend.
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Like +11 Object -0 Kiwi moved 08 Sep 18, 11:29  interesting
Wish it were as simple as that. Bridges once burnt are not so easily mended.

And its not a special pay hike, its a price correction. SAM was and to a lesser degree still remains below market on salaries. This hike only serves to lessen the gap.
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Like +10 Object -0 Scream out loud 08 Sep 18, 04:13  interesting
Everyone is blaming poor HR staff for this disaster policy who barely earn any money and are just doing their job and following instructions. Why nobody is talking about those HR Partners. Just curious. What’s a HR partner ???? What’s their role in this mess? Were they also in the dark? Or their role is only to downsize experience of laterals as if it’s their birthright. Someone should downsize them.

With such novel policies the firm will become tier 0.

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Like +1 Object -0 Ha ha 13 Sep 18, 18:13
The only partners in the firm are from the family. Rest of the partners are glorified associates
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Like +12 Object -0 Baba Sakil 08 Sep 18, 08:36  interesting  top rated
Why no written explanation about holding back arrears if you no sign letter?
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Like +4 Object -0 Shakil ka wakil 08 Sep 18, 16:52
Yeah because that is the silent arm twisting that team Khakra wants to do... the arrears are accrued from the annual increment and not due to any one time gift (what a joke) they have provided.
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Like +2 Object -27 Rupert 08 Sep 18, 08:58  troll?
This is what happens when money is your sole motivation to work. You go hammer and tongs over issues of remuneration and miss the big picture. Some of my friends at SAM speak at length about how much they love working at SAM. When they had issues they spoke to their reporting Partners instead of going all guns blazing on a public platform.

If the Firm was so insensitive they would not have cared to clarify and reach out to the people to address this issue. Chill guys!
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Like +12 Object -1 Peeing Human 08 Sep 18, 15:16  interesting
Hey Rupert what’s your cut for coming out and defending this unpardonable act. How much % increase you got?. Chappar phaad ke ? You guys made a mistake, just accept it and move on. Nobody working with you cares about you being number 1 or number 100 law firm, it’s about showing some respect. This respect is being trampled upon by throwing money at peoples faces by trying to cage them. Not good for thd firm in the long run. You may coerce your associates for a year . After that what ? Nobody will fall in your traps again. Some self obsessed looney specified jealously. No self respecting person would want to be someone like you.

Hit like button.
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Like +10 Object -3 Kiwikover 08 Sep 18, 11:26  interesting
The fact is the hikes at SAM have been better than normal, and much needed given the obvious pay gap over other top tier firms.

Barring this unmitigated PR disaster of clawback, most would likely have been happy at the unexpected pay rise, which though not meteoric as claimed, is still much better than routine.

What most will take away is only the sour taste of clawback, and its supposed recanting.
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Like +1 Object -0 Guest 08 Sep 18, 17:00
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Like +10 Object -1 Arrogant HR and Manage 08 Sep 18, 17:08  interesting
HR staff are arrogant. Even support staff are not paid well. September started but they are in wait for their turn. Even process have not been started. They will get increment on the basis of written and oral test(English Grammar) they are conducting and not upon work efficiency and feedback from immediate Partner. Bull shit Law Firm.
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Like +0 Object -12 Baba log 08 Sep 18, 19:05
I guess R baba is using all his devices to troll Uncle Sam!
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Like +3 Object -0 Guest 08 Sep 18, 20:57
Given that the above is a no holds barred discussion. Can anyone point blank tell me what's the salary like for a 5 year PQE? 3-5 PQE?

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Like +1 Object -4 First floor 08 Sep 18, 21:49
Five year pq is first year SA - salary should be around 25 to 28.
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Like +1 Object -0 Noob 09 Sep 18, 10:06
Tx. So a five year PQE is equal to a first year same. And then it goes on. 25-28 lpa is more or less same across firms equally placed like Sam?
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Like +1 Object -0 4 09 Sep 18, 13:54
I think that’s 4 years PQE at SAM. 5 year PQE is SA 2, which would be a salary of 32-37, before the most recent increment bump, so probably more now.
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Like +2 Object -0 JSA SA1 10 Sep 18, 14:08
I make more than that! I am SA1 here at JSA. U sure this is revised SAM fee for SA2? If so, then what was it before?
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Like +1 Object -8 SA 1 10 Sep 18, 16:33
SA 1 at SAM is 40 lakhs. A big jump from A3 - almost 70%
And given that you can get up to 200% variable pay, we are talking of a possible take home of 52 lakhs.
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Like +0 Object -0 Curious exp 11 Sep 18, 05:45
What is the split of fixed pay and variable pay ?
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Like +0 Object -0 Sauromon 11 Sep 18, 09:09
May be so for one or two teams, not firm-wise.
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Like +0 Object -0 Darkness 11 Sep 18, 01:34
Lawyers with 4 years PQE and who made SA in 2015, the package was 32.
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Like +14 Object -1 Melon Musk 09 Sep 18, 14:14  interesting  top rated
Howmuch more time will it take for Indian lawyers to realise that these family firms are doing nothing except peddling mediocrity and toxic work environment. Hope the law school kids these days are not mindlessly aiming for these firms.
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Like +3 Object -0 Rinkiya Ke Papa 11 Sep 18, 14:18
Do they really have an alternative? The average chamber practitioner is objectively worse by several orders of magnitude. Be it on pay, culture or exposure! The notable exceptions only serve to prove the rule.
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Like +1 Object -0 Not Frm SAM Dude 09 Sep 18, 18:15
That not from SAM guy is too funny!
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Like +0 Object -0 Curious bystander 10 Sep 18, 09:21
Hi Kian! So with the pay hikes (clause, no clause, clarifxatory clause), what are the new salary brackets at SAM? Any idea??
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Like +7 Object -5 Guest 10 Sep 18, 17:21  controversial
A0- 15
A1 - 18
A2 - 21
A3 - 25
SA1 28/29+
SA2 32+
PA 42-45
PA 2 55-60
SP 85+
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Like +0 Object -2 Impressed by SAM 10 Sep 18, 22:48
And variable pay of up to 200% which can take the numbers significantly higher!
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Like +5 Object -2 SAMmie 12 Sep 18, 11:59
That is not correct. 200% is extremely rare, in fact anything over 100 is rare. I know an SA (with variable pay of 8 lac approx.) who billed 2+cr in an year. He was given 10 lac bonus initially and 11 lac finally (after he fought it out). Thats 138% bonus, even after more than 7x billing.
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Like +1 Object -0 Blanket 11 Sep 18, 01:29
Can’t comment on associate and partner level salary, but tier 1 law firm SA’s average package is 32 and PA2 is 55. In between these are the SA2, SA3 and PA1 salaries.
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Like +0 Object -0 Mirchand 10 Sep 18, 19:08
You dunno. I thought that these figures were there at the turn of the decade. Did my associates, reporting to me on AMSS figures cheat on me. The rascals have unfortunately left otherwise I would have given them a hiding they would have remembered for the rest of their lives.
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Like +13 Object -0 Guest 11 Sep 18, 15:11  interesting  top rated
The firm has become worst for support staff since its split. There are other things which are due to be revised like the conveyance, overtime, food expenses as well as the mobile expenses. But these people are giving the same what they are giving 20-30 yrs back. But they will never think of to revise all these. On the other hand there has come an [...] who inspite of revising all these is trying decrease the same. They need the work to be done on time. They want to reach the office staff to reach office on time. But there is no timely appraisal for the staff. This year they haven't given the appraisal form to the staff. God knows what will they do this time.
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Like +0 Object -0 Mahabelly 05 Oct 18, 17:42
Since there will be no article on the pathetic increment(?) that CAM has announced, using this article to comment that CAM should just shut their Delhi office or stop calling it CAM. Even 3rd tier firm in Delhi pays better than CAM.
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