Opportunities in other areas
The local legal industry is facing headwinds as the property slump, dearth of new mainboard listings and slowing economy hit conveyancing and capital markets work while making some clients more price-sensitive.
Large law firms have not yet scaled back hiring or cut salaries of newly qualified and junior lawyers, but at least one has moderated its remuneration package for this group. A few mid-sized firms have made similar moves or reduced their number of trainees because of an over-supply of law graduates.
Ms Rebecca Chew, recruitment partner at Rajah & Tann Singapore, told The Straits Times the firm has modified remuneration packages for newly qualified and junior lawyers because of the large supply of young lawyers. "We are looking for more efficient ways to provide legal services, including services of a more routine nature which are generally carried out by our younger lawyers," she said.
She maintained that there has been no change in the salary range of junior lawyers. "We've switched back to the previous model of lower front-loading and higher bonuses."
RHTLaw TaylorWessing managing partner Tan Chong Huat said remuneration packages for newly qualified lawyers have been adjusted because of the glut. "With effective planning, we have overcome the slowdown in conveyancing and capital markets matters," and are on course to list RHT Holdings next year, he added.
KhattarWong, which established a formal alliance this year with Withers, is growing its corporate advisory, tax, offshore and private client wealth management businesses as commercial litigation and conveyancing work slows.
Mr K. Anparasan, partner of Withers KhattarWong, said that while salaries have not been cut, the firm is trying to "stretch the capabilities of existing lawyers". It has also hired fewer trainees this year but continues to recruit senior hires for its corporate advisory, tax and wealth management teams.
"Commercial litigation work is generally slowing down and it has become more competitive to secure trial work," he said. "Parties are increasingly conscious of costs and are making use of alternative dispute-resolution mechanisms like mediation. However, insurance litigation has shown an upward trend as more people are making claims."
While mainboard-listed IPO activity has dried up this year, the Catalist board remains a bright spark, noted Ms Valerie Ong, senior partner at Rodyk & Davidson.
She added: "Our equity capital markets partners have been busy with secondary fund-raising and M&A corporate actions involving listed groups."
Large firms still see steady income from areas such as dispute resolution, mergers and acquisitions and regulatory work. Drew & Napier has seen an increase in M&A, arbitration and regional restructuring work, said Senior Counsel Davinder Singh .
Senior Counsel Alvin Yeo of WongPartnership said: "We have a well-hedged business.
"While mega M&A deals have slowed, small and medium-sized deals by private equity firms are still being done."
Rodyk's Ms Ong also saw more attractive M&A deals emerging as asset prices fall: "The Singdollar remains relatively strong. This means some markets, such as Australia, have become more interesting for Singapore investors."
Mr Lucien Wong, chairman and senior partner, Allen & Gledhill, said the firm is buffered by a variety of legal work here and regionwide.
"Singapore's move to become a dispute-resolution hub has provided benefits. We have seen a steady uptick in alternative dispute-resolution and arbitration work," he said.
But Senior Counsel Andre Yeap, head of international arbitration, Rajah & Tann, noted that Singapore being an arbitration hub is unlikely to fully compensate for any downturn for local firms.
There are also opportunities to redeploy lawyers to growing areas, such as intellectual property and regional restructuring, said Mr Yeo of WongPartnership, which has a partnership with firms in Malaysia and Indonesia.
"Our Indonesian partner has strong corporate and M&A expertise. Malaysia is still undergoing political and economic turmoil, so the slowdown there is more pronounced. But if you're small and nimble, with a niche practice, you can still compete."
Mr Yeo added: "A majority of the law firms in Singapore are small and cater more to retail clients who tend to be price-sensitive, for instance, in conveyancing matters. Those law firms which face a slowdown will respond in different ways... but most will survive, as this is not the first time the economy has slowed down."