For many law firms, salary reviews are a once- a- year exercise – a process that feels more like a tick- box than a true people strategy. But in 2025’s market, where pay has become both a baseline expectation and a make- or- break factor, that approach is no longer enough.
Our Legal Talent Report 2025 shows that 61% of lawyers stay because they’re fairly paid, while 77% would move for a better financial package. These figures underline a key truth: salary alone doesn’t buy loyalty, but the perception of unfair pay almost always drives dissatisfaction.
Mistake 1: Treating pay as a one-off review
A yearly review might have worked five years ago, but today’s market moves faster. Inflation, cost-of-living pressures and competition from firms offering remote or flexible models mean that your people are constantly aware of their value.
Avoid it: Treat salary as a living, breathing part of your people strategy. That means benchmarking regularly, not annually – and linking pay discussions to development milestones, not just the calendar. Realm’s 2025 Salary Guide is an easy way to check if your structure reflects current market reality.
Mistake 2: Keeping salaries opaque
Pay transparency has gone from “nice to have”, to essential. Lawyers want to understand how pay is structured, what they need to do to progress, and how fairness is ensured across teams. Without this clarity, even competitive salaries can feel arbitrary.
Avoid it: Share the framework behind your pay decisions – including progression pathways and the link between performance and reward. Even when budgets are tight, transparency builds trust and engagement.
Mistake 3: Ignoring fairness and perception
Pay fairness isn’t just about what’s on the payslip; it’s about how lawyers feel their contribution is valued. If someone believes they’re being underpaid compared with peers, disengagement often sets in long before they start applying elsewhere.
Avoid it: Make fairness part of your pay conversation. Review internal parity by gender, PQE and practice area, and communicate clearly about why decisions are made. It’s not always about being the highest payer – it’s about being fair, consistent and open.
The takeaway for firms
In a world where flexibility and work-life balance have become standard; salary is no longer a differentiator – but it remains the foundation for trust. Get it wrong, and everything else falls apart. Get it right, and it becomes the platform on which engagement, loyalty and performance are built.
Download the 2025 Salary Guide for Law Firms to benchmark your pay structures by practice area, PQE level and region – and ensure your firm stays competitive.
