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Dear Colleague,

Towards the end of 2012, the Society’s Finance Committee requested one of the leading Irish and international consultancy firms, Towers Watson, to conduct an objective remuneration review of senior management pay in the Law Society.  A summary of the key findings of that review are set out below as an Addendum to this letter.

Although this review process had commenced before the major controversy broke in relation to remuneration and pension entitlements of the former Chief Executive of the Irish Medical Organisation (IMO), this undoubtedly formed a backdrop to the exercise being undertaken by the Society.  The elected representatives of the solicitors’ profession needed to be reassured that no such situation existed in the Law Society.  The Council of the Law Society has been completely reassured in that regard and I can now pass that reassurance to the solicitors’ profession.

On 9th May, 2013, a special meeting of the Society’s Finance Committee considered the Towers Watson report.  A presentation of the report was made and detailed Committee questions were answered by the very senior individuals in Towers Watson who had conducted the review.

Towers Watson assured the Finance Committee that the current governance structure and processes for managing reward in the Society are working well and that executive pay is market competitive with appropriate comparators.

A copy of the Towers Watson report was sent to every Council member in advance of the Council meeting on 17th May, 2013.  The chair of the Finance Committee, Michelle Ní Longáin, presented the report and its contents were discussed at length at a section of the meeting at which, as was the case with the Finance Committee meeting, no staff members were present.

At the end of the discussion the Council resolved that it:

1. welcomed the Report’s conclusions that the Society’s governance structure and processes for managing reward are working well and that the pay levels and benefits packages of the Director General, Senior Management and other executive roles are market competitive with appropriate comparators;
2. agreed to place the Remuneration Review in the members’ area of the Society’s website, together with an explanatory note from the President (a) identifying the principal points in the simplest possible terms, (b) outlining the legal advice on disclosure, (c) confirming that the Society’s pension fund is 95% funded as verified by the Society’s actuaries, Mercer and (d) confirming that no ‘IMO-type’ situation pertains in the Society.

In the course of its discussion, the Council recorded its appreciation for the excellent work and commitment of the Director General, Senior Management Team and the Executive of the Society generally, who have the Council's full support.

In common with almost every other private sector organisation, the Society has never published details of the remuneration of individual members of staff.  This policy position in any case is underpinned by clear legal advice to the Society that, although general details of the remuneration of staff are provided in the annual report and accounts of the Law Society each year, details of the remuneration of individual staff members are not provided so that the Society may comply with its contractual and statutory obligations to its employees.

The Council has decided to take the very unusual step of publishing in full the Towers Watson report on the members’ area of the Society’s website so that members as a whole might receive the assurances outlined above. View the Towers Watson report here.

James McCourt
President

Addendum - Summary of key findings of the Towers Watson Remuneration Review

• Pay policies and pay levels in the Society would not be expected to reflect the pay policies or pay levels within the profession.

• The pay processes in the Society are working well and there are good systems for deciding on pay levels and pay increases. There has been a pay freeze since 2008 and the defined benefit pension scheme has been replaced by a hybrid scheme for new entrants.

• Because the Society does not provide annual bonuses and other benefits are limited, base salary is a critical reward mechanism in the Society. When compared against the market, the total pay levels paid to the senior staff in the Society are slightly above the middle of the market. This is not unusual, given factors such as length of service, absence of bonus and the specific skill sets required. The specialist nature of some of the key posts in the Society would generally attract a premium in the market.

• The benefits package for the Director General is broadly in line with market. Apart from pension, the benefits provided to the Senior Management Team and other executive roles reviewed are either behind the market or market competitive.

• The Society should continue its management and oversight of base salary levels and increases and should review its senior pay levels and policy every 2-3 years.