The Magic Circle Vs US Firms

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The Magic Circle is a term used to describe a group of five prestigious UK Law Firms: Allen & Overy, Clifford Chance, Freshfields, Linklaters, and Slaughter and May. All these firms maintain strong international presences and have the ability to draw on a sizable army of lawyers, with large intakes boosting or maintaining their numbers. The trainee intake is generally around 100 per year at each firm. Each Magic Circle firm centres its work on corporate and finance deals, and these areas are still dominated by the Magic Circle as a result. Expect other areas of practice to act in support of those areas – e.g. you might find that litigation work you take on is financed-based. Of course, there are other, larger law firms in the world – and there are other large London firms too. Indeed, the Magic Circle was previously known as the Club of Nine, and included other firms like Norton Rose.

Why are the Magic Circle firms so good?

To understand why they are so prestigious, we can look at the Chambers UK rankings. This set of rankings gives a clear overview of which firms are seen as being the best performing in the UK. If we look at Band 1 and 2 for banking and finance, for example, we find that Allen & Overy appears three times across four bands, Clifford Chance appears twice, and Linklaters twice. Compared to other UK firms, there is a clear domination exerted by the Magic Circle firms. We can further see their prestige through some of the deals that they advise on – if you read the FT, you will note that any large banking deal will still involve at least one Magic Circle firm. Examples of other commercial deals in recent years that involved the Magic Circle would be the theoretical merger between Sainsbury’s and Asda, which involved Linklaters & Slaughter and May, and Royal Dutch Shell buying out BG group, which involved Freshfields & Slaughter and May.

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However, this Chambers UK ranking also makes it clear that US firms are beginning to encroach on territory previously held by the Magic Circle. White & Case, for example, appears twice in the same set of rankings. Latham & Watkins appears twice too, and is Band 1 for lender-side banking and finance.

Unlike US firms, Magic Circle firms are strong across a great many departments outside banking & finance and corporate, which means that you might be able to take on some more varied and interesting work than if you were to work at a US firm.

How do the US firms differentiate themselves?

US firms offer far higher pay than the Magic Circle. This is principally after qualification, with trainee salaries being relatively similar between the two groups of firms. At Magic Circle firms, Freshfields pays the most, offering £85,000, with Slaughter and May offering ‘only’ £71,500. Looking at the US firms, we find that Kirkland & Ellis offers $180,000 to its newly qualified lawyers. The race to be the first firm to offer a $200,000 NQ salary in London is on, and will clearly be won by a US firm. This might make many high-flying students want to take their chances with the US elite – especially when one considers their high performance in the rankings too, and the potential for them to continue taking territory from the UK firms. 

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What’s it like doing a Training Contract at a Magic Circle firm versus a US firm?

The primary issue for those working at Magic Circle firms is the long hours. Whilst current trainees explain that the hours vary from team to team, you should expect to spend many days at your desk until late at night, especially when you’re undertaking banking & finance or corporate seats. However, with a Magic Circle firm you do benefit from a large intake of trainees, and strong support for those trainees, with more dedicated support staff. You are also more likely to be able to take a secondment with a UK firm.

Interestingly, the long hours at Magic Circle firms are actually seen to pale in comparison to the hours working at US firms. The US firms have markedly smaller intakes, and as a result you should expect long hours, and being required to cover for others, to be much more of a norm.

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