Law firm Knights to cut board members salaries as it tackles virus outbreak

Legal firm Knights Group is to cut the salaries of board members and high earning employees as a result of the coronavirus outbreak.
David Beech, CEO of KnightsDavid Beech, CEO of Knights
David Beech, CEO of Knights

​The firm, which entered Leeds with the acquisition of independent law firm Shulmans earlier this month, will reduce board members’ salaries by 30 per cent and reduce the salaries of all staff who earn £30,000 or more by 10 per cent. The pay cuts will take effect from April 1.

The group, which also has an office in York, said the pay cuts are part of a number of cost saving initiatives in areas that won't compromise the prospects of the business in the long term.

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These include stopping or deferring all non-essential capital expenditure across the firm. It has also eliminated all discretionary spending, including marketing.

The law firm, which also has an office in York. said trading to date has been in line with market expectations, with no adverse change to the group’s performance as a result of the coronavirus outbreak.

It said the health and well-being of its staff has been the group’s priority since the outbreak of the COVID-19 virus.

All employees have been working from home since March 13 and the legal firm said this action was taken ahead of the Government’s official request for businesses to facilitate home working.

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The firm said its previous investment in secure, robust systems, infrastructure and technology platforms are supporting the efficiency of the business and have enabled teams to work effectively from home, with productivity remaining at normal levels.

It said that this investment, along with a strong team culture, has enabled Knights to protect its colleagues without adversely disrupting service levels to clients.

The group said it operates a resilient business model, with its full service offering and geographic reach supporting a highly diversified revenue and client base, and industry leading working capital management.

While the group has seen only a limited impact on revenues and cash flows to date, it has pre-emptively put a number of precautionary measures in place given the increased economic uncertainty created by the spread of the coronavirus pandemic.

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David Beech, CEO of Knights, said: “Since the outbreak of the coronavirus, our primary concern has been the safety and wellbeing of our colleagues, who have responded with great commitment and resilience.

“Whilst we have traded in line with market expectations to date, we have decided to take a number of precautionary measures in response to the anticipated economic impact from the spread of the virus, to ensure maximum flexibility to respond to the changing market environment.

“We enter this period of uncertainty as a resilient, well-invested, diversified and cash generative business offering a unique proposition in the highly fragmented and often under-invested market for legal services outside London. The business is in a strong financial position and I am confident that the Group’s strategy, supported by a talented team, will see Knights emerge from the near term uncertainties in a strong position."