Compensation Report

Posted on March 7, 2016 at 5:03 PM

We are pleased to share this compensation report to provide guidance to our partner and associate candidates.  We have gathered information with the help of our law firms clients and candidates and from our in-depth knowledge of the market.  Please note that this report isn't all inclusive as we represent mostly Am Law 100 international firms and top local firms in Tokyo, Hong Kong, Mainland China and Singapore.     

Premier law firms are offering increasingly competitive packages in order to attract and retain top legal talent throughout the Asia market. Hiring conditions across Asia are showing steady and noticable signs of improvement with new openings in litigation, dispute resolution, project finance, fund formation, capital markets and M&A.

Interestingly, the Hong Kong market for the last twelve months has been experiencing the continued tussle for HK qualified and US, UK and AUS qualified associates and a few American firms continue to pay their Hong Kong and UK and AUS qualified associates at New York-scale salaries starting at $160,000 for first years. However, it is important to note that not all of their competitors in Hong Kong have followed suit and some are waiting to see how these salary changes develop.

The Hong Kong and Beijing offices of US NLJ 350 firms also saw large increases in their lawyer headcounts this year. Beijing firms experienced an 15% gain and Hong Kong firms experienced a 12% gain.

When comprising an offer, law firms consider several factors such as cost of living, hardship associated with living in particular locations, familial status, competition/supply of appropriate candidates with a particular skill set, the firm’s interest level in a candidate, profitability of the office, and the firm’s ability to attract and retain top talent. As more U.S. law firms establish offices in Asia and compete for legal talent, expat packages might increase.

For lawyers wanting to make a lateral move, it is more important than ever to thoroughly research the various benefits of potential placements. Be careful and use an experienced and knowledgeable recruiter who can provide you with current remuneration information and negotiate on your behalf. Make sure that the recruiter has experience in the specific market, and a sharp focus on that market.

                                                                    Ex-pat Package Must-Haves

US Qualified Associates:

Base salary: At the most competitive law firm in terms of compensation, US qualified lawyers are paid at New York rates ($160K for first year lawyers, $170K for second, $185K for third, $210K for fourth, $230K for fifth, $250K for sixth year lawyers). Firms that pay NY rates include but are not limited to the Wall Street law firms and other firms that compete most directly with the Wall Street firms for associates. Generally speaking, the more profitable the law firm in terms of profits per equity partner and revenue per lawyer, the more likely they are to pay NY rates and stronger expat packages regardless of whether they are headquartered on Wall Street.

The law firms that do not pay NY rates tend to pay rates that are equal the rates paid in the office where the firm is headquartered, but as mentioned above many non-NY firms still pay NY rates. At firms that do not pay NY rates, associates still earn well into six figures, but on average about 10-15% less than NY rates.

Bonuses: Some firms offer discretionary bonuses that will follow those given to attorneys at the firm’s head office. Depending on the firm, any performance bonuses may be pro-rated, and this is typically based on the candidate’s start date and marketability as well as the firm’s profitability in that fiscal year. The more competitive firms pay flat bonuses that are consistent with New York bonuses, while some firms tie bonuses to factors including class year, hours, and/or pro-bono activities.

Tax Consequences: U.S. citizens and permanent residents (green card holders) must pay U.S. income tax, in addition to any income taxes due to the host country. However, there is relief – the first $95,100 of your salary will be excluded from your U.S. income tax liability, regardless of location. Housing allowance exclusions vary according to country (i.e. in Hong Kong, your housing payments are deductible up to 50% of your taxable income).

Tax Equalization: Due to double taxation on sums above the exemption, most international firms have implemented a tax equalization plan as part of a remuneration package, which can offset the expatriate’s tax burden and sometimes undermine a tax benefit to associates in certain markets. Tax equalization plans are designed to make taxes a neutral factor in an expatriate’s compensation package.

A U.S. taxpayer may also exclude a certain amount of his or her foreign housing expense that is the excess of the taxpayer’s reasonable “foreign housing expense” for the tax year over a “base housing amount” equal to 16% of the maximum foreign earned income exclusion amount for the calendar year, multiplied by the number of days of foreign residence or presence by the taxpayer for the year. However, foreign housing expenses may be excluded only to the extent of the lesser of: (i) the expense attributable to the law firm provided amount; or (ii) the taxpayer’s foreign earned income for the taxable year.

Expat benefits: Firms generally offer a range of benefits for foreign nationals working in Asia. A variety of factors influences the package that is offered, including cost of living, profitability of the office, the firm’s competitiveness in the legal market, an attorney’s nationality and academic pedigree, and whether a firm considers the location to be a hardship destination. For example, Singapore firms often do not offer expat compensation because it is not considered a hardship post, but some law firms there have begun offering benefits between US $30,000 and US $55,000.

UK Qualified Associates

Salaries and Bonuses: Throught Asia, the magic circle firms pay their UK associates rates similar to what they would earn in London at the same firm (but US associates are paid US rates).   

It's worth noting that salaries tend to vary slightly (maybe one or two percent) between Magic Circle firms for each class year, but these firms tend to basically pay the same rates. UK Lawyers are paid bonuses from between 10% to 40% of their annual salary depending on PQE and performance. Other benefits like tax equalization are not uncommon.

                                                                         Hong Kong

For more information on basic salaries for US and UK qualified associates in Hong Kong, please refer to Section 2 above (“Expat Package Must Haves – US Qualified Associates and UK Qualified Associates”). Expat packages in Hong Kong at firms that pay such compensation (many do) can range from $30,000 to $90,000.

For Hong Kong qualified associates, packages in Hong Kong have experienced much more variance than usual this year, as a few American firms continue to pay all of their associates, whether US or Hong Kong qualified, New York scale salaries starting at $160,000 for first-years. Benefits often include housing and moving allowances for the associate. However, generally speaking Hong Kong-qualified attorneys will receive pay consistent with the domestic market. For Hong Kong associates, the median starting salary is HK$63,000 per month. Moreover, Hong Kong associates receive bonuses that are on average 12.5% of the lawyer’s salary

                                                          Mainland China (Beijing and Shanghai)

For more information on basic salaries for US and UK qualified associates in Mainland China, please refer to Section 2 above (“Expat Package Must Haves – US Qualified Associates and UK Qualified Associates”). Expat packages can range from $20,000 to $60,000.

Taxes are higher in Shanghai and Beijing than in Hong Kong but the cost of living is significantly lower than in Hong Kong, so ex-pat packages are typically about 20% smaller. With that, firms will often tax equalize pay to ensure that lawyers in Mainland China receive remuneration similar to associates in Hong Kong. Essentially, associates in Mainland China will receive benefits that are similar to the Hong Kong ex-pat model package.

PRC Nationals: PRC attorneys who have a JD are usually hired as associates while those with only an LL.M. from a top U.S. law school, who are qualified to practice in New York or California, and have worked at an international law firm might be hired as “associates,” “foreign associates,” or “legal consultants,” depending on the law firm and level of experience.

Compensation for PRC nationals can vary, but they certainly receive a higher salary at a foreign firm rather than at a Chinese firm, although the pay at a U.S. or U.K. firm for PRC nationals might be far below that of expatriates. The range for an annual base salary for a PRC associate would start at 60,000 to 130,000 RMB, and increase with experience. Bonuses for PRC nationals might also be lower than for expatriates, and, unless they hold a green card, they most likely will not receive an ex-pat allowance of any kind. Some firms offer travel and relocation expenses but that is becoming rare in the current market.


General Considerations: In Tokyo, the ex-pat packages that went out remained stronger than in any other Asian market, given the cost of living and particularly small supply of bilingual attorneys looking to practice there. The packages range from $45,000 to $85,000 USD, depending on seniority, familial status and firm. In Tokyo, most U.S. and U.K. firms also offer to cover the costly venture of relocating and securing housing there, and they cover the “key money” and deposit, acting as guarantor and usually signing leases in the firm’s name.

U.S. and U.K Nationals: U.K. firms offer salaries are linked to the lawyers’ level of qualification in London with a significant additional cost of living allowance. Such benefits, include, health care, gym membership, and airfare expenditure.
U.S firms offer a lump-sum salary to their associates, which will be higher than the salaries given by U.K. firms. Some U.S. firms will give associates “New York scale” salaries with benefits. In general, bonus packages follow the firms U.K or U.S. model.

For more information on basic salaries for US and UK qualified associates in Japan, please refer to Section 2 above (“Expat Package Must Haves – US Qualified Associates and UK Qualified Associates”).


General Considerations: Law firms in Singapore historically did not offer ex-pat packages, given that it was not considered a hardship destination and the cost of living is so moderate. But as Singapore began competing with other locations such as Hong Kong for top attorneys, firms there had to start offering certain benefits including relocation and minimum housing allowances. In general, these benefits offered by firms range between $20,000 to $45,000 USD. Some firms do not offer any allowances because companies and firms considered Singapore a non-hardship post.

U.S and U.K. nationals: For more information basic salaries for US and UK qualified associates, please refer to Section 2 above (“Expat Package Must Haves – US Qualified Associates and UK Qualified Associates”).

U.K. firms offered salaries that ranged from SG$120,000 to $140,000. However, lawyers in Singapore were given bonuses around 10 to 15% of their annual salary. Moreover, the tax rates in Singapore are smaller than in London, and most associates rarely pay more than 15% in tax.

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