Inside signing bonuses at Irish law firms

Signing bonuses have become an established feature of the Irish legal recruitment market, writes Bryan Durkan (small picture), managing director of Spencer Lennox Legal Recruitment.

Bonuses are most common for solicitors in the three to eight years post qualification range.

They are offered by top-five, mid-tier and international law firms.

Signing bonuses are neither automatic nor uniform. Their availability and value depend on the firm, practice area and candidate. 

Why do law firms pay signing bonuses?

A signing bonus is a once-off payment designed to make a career move more financially attractive to a candidate.

It can be used where a candidate’s existing salary is close to the salary offered by the hiring firm.

It is also offered to solicitors relocating to Dublin from large City firms in London, where salaries are generally considerably higher.

A signing bonus can help narrow the immediate financial gap, although it will not ordinarily compensate fully for the difference in base salary.

Whether based in Dublin or relocating from overseas, solicitors coming from highly regarded teams, or with particularly sought-after experience, will generally command the largest signing bonuses. 

How much law firms pay?

• 5+ PQE: €10,000–€40,000,
• 4 PQE: €10,000–€30,000,
• 3 PQE: €8,000–€25,000,
• 2 PQE: €5,000–€20,000,
• 1 PQE: €2,500–€10,000,
• Newly-qualified: €2,500–€10,000.

The upper end of each range typically reflects the signing bonuses paid by the most competitive of Ireland’s top-five law firms.

Mid-tier firms in Dublin also pay signing bonuses, although figures tend towards the lower end of these ranges.

International firms take varying approaches, but their bonuses are generally closer to mid-tier levels than to the highest amounts available. 

Which areas attract strongest bonuses?

Signing bonuses are most prevalent in areas where demand for experienced solicitors is consistently high.

These include:

• M&A,
• Banking and finance,
• Debt capital markets,
• Aviation finance,
• Funds,
• Tax,
• Real estate,
• Technology and privacy.

While these areas of law are where we most frequently see a signing bonus, a firm may offer a signing bonus in any practice area where it has a particular need to secure their preferred candidate. 

What strengthens negotiating position?

Effective negotiation begins with an informed and realistic understanding of the market.

Candidates should know what is achievable at their PQE level, what quantum of signing bonus their target firm typically pays – if it pays one, and whether their particular practice area is attracting a premium.

It is important to understand genuine market value, rather than perceived market value.

A pragmatic approach will usually produce a better outcome than treating the upper figure in a broad range as automatically achievable.

When is a signing bonus paid, and how is it taxed?

A signing bonus is taxed in the same manner as basic salary.

It may be paid in full with the new employee’s first salary payment, or divided into two instalments: one on joining and the second following successful completion of probation.

What are repayment obligations?

Repayment provisions vary.

Some firms impose none; others require repayment if the employee leaves within a specified period.

A typical clause might require repayment of 100% if the employee leaves within six months and 50% if they leave between six and 12 months.

A signing bonus can materially improve the value of an offer, but the headline figure should never be considered in isolation.

For solicitors in the 3–8 PQE range, it can be particularly useful when building a deposit for a first home.

The strongest negotiating position comes from understanding both the market and one’s genuine value within it.

Ultimately, a signing bonus should support the right career move rather than become the principal reason for making one.