People management has traditionally been an area in which the legal sector has lagged behind other industries – but this is changing. Lawyers are facing more demanding clients, a tighter labour market and legislation such as the UK’s Legal Services Bill, which proposes to put the consumer at the heart of the regulatory framework. In this increasingly competitive environment, firms are devising reward structures and career development programmes designed to attract and retain the most talented professionals.

“The industry generally is changing and having to embrace everything that’s involved in making up an organisation and servicing the client,” says Weedie Sisson, a former HR director at a law firm who worked on the research for this report.

Financial rewards certainly remain important. In a recent survey conducted by the Law Society, having a competitive salary and benefits package was still seen as more important than a good working environment in attracting and retaining staff. However, it ranked only fourth in the top five ingredients.

Having a line manager who supported staff development was seen as the most important tool for retaining staff.

Second on the list of factors seen to create job satisfaction was opportunities for career progression and a transparent career path. This, says David Miles, a partner at BDO Stoy Hayward, the accountancy firm, is not something in which law firms have traditionally excelled.

“In a lot of firms, there is a reticence on the part of partners to engage staff in discussions in early stages of their careers,” he says. “For firms that do start engaging associates at an earlier stage, it actually forces them to identify what they are looking for in terms of making partner. But firms are only just waking up to the fact that they need to do that.”

Nevertheless, some firms have put together thoughtful programmes in this area. Latham & Watkins, for example, has transformed what was a haphazard process for finding in-house jobs for its associates into one that is structured and centralised though its intranet and involves partners, associates and clients in the process (click here for rankings).

Cobbetts has established a Leadership Development Centre as a way of identifying future leaders. The initiative is centred round a two-day off-site programme in which partners participate in different business-focused activities designed to identify their individual strengths. By the end of each session, participants will have established a personal development plan tailored to the firm’s business strategy.

Performance management is starting to receive more attention from law firms. At Ashurst, the old method of assessing and rewarding associates – using post-qualification years as the basis for career progression – has recently been turned on its head with the introduction of a competency-based structure that takes account of skills, such as the ability to work as part of a team. This approach has been integrated throughout the business since associates will now be charged out according to their value, not their number of post-qualification years.

The use of bonuses can be a powerful tool in staff retention. At Allen & Overy, for example, as well as changing the way it rates staff to a method based on their skills, behaviours and personal attributes, it now ties its performance-based bonuses closely to partner profit points. The firm is moving away from simply linking associate remuneration to their level of qualification. The changes have apparently paid off: the firm says the rate of staff turnover has fallen by 9 per cent in the past year.

Another area in which law firms need to make up ground is in the development of support staff. “In terms of the programmes and initiatives law firms are introducing, most of them are still geared towards the solicitor, and rightly so because they are the ones billing their time,” says Ms Sisson. “But the next step would be to look at who helps them get to where they are – and that is the support staff.”

Mr Miles agrees this as a crucial step. “Some law firms are going the route of rewarding support staff as well as fee-earning staff,” he says. “That generates team spirit and you do not get quite such a divide between the fee-earning and non-fee-earning staff.”

As well as rewarding support staff, some firms are offering them similar career development programmes to those offered to partners and associates. In a programme focusing on the acquisition of technical knowledge and competence, Uría Menéndez, the Spanish firm, is offering training to all of its secretaries.

Wragge & Co is also keen to spread opportunities for self-development through all levels of the firm. Both lawyers and support staff are offered the chance to take part in a training programme that includes basic skills such as presentation, communication and negotiation.

“From front office messengers to senior partners, we encourage everyone to go on an appropriate course,” says Allex Jenkinson, the firm’s training and development manager. “And we have a separate strand of courses for our secretaries as they are 25 per cent of our firm and essential to the business.” Moreover, having staff from different parts of the firm take courses has delivered another benefit. “The lawyers often come with a very technical focus whereas the support managers often have had wider industry experience,” she explains. “So, they can share their experience.”

While training programmes proliferate, flexible working programmes are less well established in the legal sector. One example is at Bond Pearce, where 22 per cent of employees, from secretaries to partners, now work flexibly, with two associates working full-time from abroad.

Yet, when it comes to well-being and work-life balance programmes, Mr Miles says that many firms have not yet made the connection between a satisfied workforce and higher productivity and performance.

“We are seeing surveys that are full of [demands for] flexible working and work-life balance,” he says.

“And those firms brave enough to survey their staff are having to react to that feedback.”