Scrapping the minimum salary for trainee solicitors is likely to stimulate more training contracts – but the majority will pay below the current minimum level, a Solicitors Regulation Authority (SRA) report has concluded.
It also found that around half of trainees and students said they would be unable to train as a solicitor without the minimum.
However, the SRA’s draft economic and equality impact assessment – released for a very short consultation period – suggested that the negative impact on diversity is not be as clear-cut as critics think, at least so long as ending the minimum is counterbalanced by an increase in contracts.
The assessment – which used data analysis, online surveys and focus groups – found that 70% of firms which currently do not offer training contracts would consider doing so if the minimum was abolished, but of those, 69% would pay below the current £16,650 set for outside of central London (where it is £18,590).
A third of those firms which already have trainees would consider providing more contracts, but 82% of them said it would be below the current minimum – there would also be a proportion of firms (around 10%) which reduce the salaries they pay trainees but not increase the number they take on.
Concern over the impact of scrapping the minimum focuses on those smaller firms which pay at or near it at the moment – where women, those from a black or minority ethnic (BME) group, people working outside of central London and those who attended state schools are more likely to work.
The report said that such firms generally “take into account many more factors than just the minimum salary when deciding how many trainees to take on and what to pay them” – key considerations include the profitability of the firm, relevant experience of candidates and salaries paid by competitors.
Nearly half (47%) of current trainees felt they would not be able to train as a solicitor if the SRA did not impose a minimum and, as a result, salaries fell. “Many of these respondents indicate that if they wages were to reduce, they would not be earning a liveable salary,” the report said, with loan repayments for legal practice courses a key contributory factor.
However, there was no evidence that those from groups seen as likely to be disadvantaged by the end of the minimum were more likely to say this.
Exactly half of students, paralegals and others considering training as a solicitor said ending the minimum would affect their ability to train, with women and those from state schools more likely to state this, but not BME students.
The report noted that it was not known whether those who chose not to train as a solicitor would be able to command better salaries than whatever level trainee pay moves to, meaning “the actual impact on career choices if deregulation takes place might be different to that stated”.
It added: “Even though we found widespread concern that BME groups, women and those from lower socio-economic groups would be put off from entering the profession, thus impacting on its diversity, BME respondents were no more likely than white respondents to say they would not be able to train if we removed the minimum salary requirement… [All the findings] suggest there may be a more complex impact on diversity in the profession than supposed.”
Nonetheless, the report conceded that any reduction in salaries would have “a disproportionate impact” on trainees from those affected groups.
The impact assessment is open for comment until 11 May, and the results – along with responses to the recent consultation – will be fed into the meeting of the SRA board on 16 May at which the minimum salary will be discussed.