TOKYO DRIFT

Written by Alexis on 26 September 2011. ♦ Associates' Corner, Expat Packages, Lifestyle  ♦ Cost of Living, Tokyo

We have recently been working with several firms in Tokyo on hiring needs which range from M&A/cap markets to project finance to litigation/dispute resolution.   In the past 5 months, the following roles in Tokyo BigLaw have popped up:

• Junior to mid-level US associate candidates with capital markets experience.  Ideal candidates will also have experience in other forms of corporate law (such as M&A and bank finance) in addition to capital markets.  Must be at least business fluent in Japanese.   There are MULTIPLE such openings.

• Mid-level US-qualified M&A candidates who are at least business fluent in Japanese.

• Mid-level to senior project finance associates, US qualified.  Candidates with power experience as well as experience negotiating project agreements will be highly prized.  Language skills are of secondary importance although business fluency in Japanese or Korean will be very helpful.

• Mid-level Dispute Resolution candidates, US qualified.  Business fluency in Japanese required.

• Junior (2009-2010 PQE) and Mid Level (2005-2007 PQE) ENGLISH or AUSTRALIAN qualified Energy lawyers with experience in the Upstream Oil & Gas field.  Ideal candidates will have project development and M&A experience.  Japanese language skills not required.

Expat / COLA Allowances Continue to Rise in HK / China

Written by Robert on 09 September 2011. ♦ Associates' Corner, Expat Packages  ♦ Beijing, China, Cost of Living, Hong Kong, Shanghai

Please feel free to check out this link to see some of our recent articles on expat / cola allowances in Asia. As we predicted in November, '10, US$80,000 has become much more the standard in Hong Kong and China.  80k has replaced 60k as what is considered a highly competitive number. Most US and UK firms in Asia seek our advice when they are considering any changes to their US associate expat / cola benefits package.  In some cases we have even helped draft expat benefits policies for firm clients opening new offices in Asia.  The reasons are quite simple:  a) the hiring partners at these firms know us well after years of working together;  b) they know we see more offer letters than anyone else in the market, from firms they consider relevant to them re associate recruiting; and c) unlike in other overseas markets (such as Moscow and Dubai for example), most US and UK firms in Asia tend to not share this information with anyone (recruiters, candidates or other firms), except when they provide offer letters.  Thus Robert Kinney and I have been asked for advice in this area from firms in Asia for years, going back to '05.  Alexis Lamb has been helping firms with this information in recent years as well.  In a way, firms share this market info in Asia through our team at Kinney because most firms get the expat / cola market info from us.   Without any doubt there is not any better source than our Kinney Asia team for major law firm expat / cola allowances in Asia. With that said, we of course are never going to publish any specific firm's expat / cola allowance information.  In our posts on expat / cola allowances, we are only going to divulge general market info, without naming firms.  However, of course we do provide to our US associate candidate clients all the details on specific firms' expat / cola policies that we cannot publish here. Recently, we are seeing quite an uptick in the market regarding these allowances.  For example, in the past few months a magic circle firm has moved from 65k to 85k and three more Wall St. firms have moved from an allowance in the 60s to the 80's.  Here is the current breakdown of expat / cola allowances above 80k at the top end of the market in HK / China, compared to 18 months ago (these numbers are for associates with no children as some firms pay substantially higher allowances for associates with children): US$90,000 and above -There are currently three US firms (although one of these firms has tax equalization on the base, so the overall take home pay is not top market). -18 months ago there were 2 firms at this level. US$85,000 -There are currently 3 firms at this level, one UK firm and two US firms. -18 months ago there were no firms at this level US$80,000 -There are currently four US firms at this level. -18 months ago there was one US firm at this level. Thus, in early '10, only three US or UK firms in HK / China were paying $80,000 or higher expat / cola allowances for all their US associates with no children.  Today that number has increased to ten firms.  Further, we have seen offer letters this year with US80,000 or higher allowances from additional firms, not among the above ten firms.  Although it is not the approach of the majority of firms in the market, a number of firms do figure out expat / cola on a case by case basis, rather than a uniform amount for all their US associates.  Some of these firms have been offering US$80,000 or higher allowances recently as well (although not to all of their US associate offerees). Most of the top Wall St. firms are still below 80k, but we expect that to change over the next 6 months.  Of the above ten firms, only four are Wall St. firms.  Three other Wall St. firms offer expat / cola allowances in the 70's and most of the rest are in the mid 60's.  It is only a matter of time before most of these firms will raise their allowances to the 80s and a few of these firms are already in serious internal discussions to do just that. One significant change in the market in the past 18 months is that the very top market expat / cola allowances are not coming from Wall St. firms, but instead several US firms not based in NYC as well as one magic circle firm.  A few of the top Wall St. firms that had for years been paying top 5 allowances in the HK / China market are now no longer even in the top 15 in allowance amount.  Further, due to some US firms offering sometimes very high allowances, on a case by case basis, it has become common for Wall St. firm offers to be lower than other firms they may be competing with for a particular candidate. A couple of Wall St. firms raised their allowance from the 60s to the 70s in the past year and it took a lot of internal discussion and a fairly long approval process from NYC senior management to happen.  Most likely those firms will raise to the 80s within the next year, but these firms' partners in HK / China have to go through a process to get such a raise approved and it can take time.  On the other hand, some US firms give their senior partners in Asia a lot of discretion in raising or lowering (rarely happens even in down market) expat / cola allowances and at those firms the process can be as little as a few days from HK / China office request to US senior management approval.  There are some US firms that will be in the 80s soon, but are simply waiting for US senior management to approve the raise. There are still several major US firms that do not pay any allowances to US associates in HK / China.  Those firms are having a difficult time recruiting and retaining the top US associate talent.   In some cases, these firms provide large signing bonuses to especially sought after offerees, in order to help counter their firm's strict no expat / cola allowance policy. About half of US and UK firms which pay competitive housing / cola in the region will also provide substantial additional allowances for US associates with children. These additions can range from $10,000 to as much as $80,000, depending on the firm.   For example, one of our mid-level US associate candidates, married with one child, was recently offered an expat / cola allowance of US$125,000 (at a firm that offers US$95,000 for unmarried associates with no children).  Another of our mid-level candidates with two children was recently offered US$105,000 (at a firm that figures out expat / cola on case by case, with associates with no children typically receiving around US$75,000 for their allowance).   The most generous of firms in this area  is a US firm that offers an additional $20,000 for one child and then another additional $55,000 for a 2nd child.  Most firms that do offer additional allowances for associates with children limit the increase to $10,000 or $20,000 per child. Also, a growing minority (but still a small minority) of top US firms also provide tuition reimbursement assistance for associates with school aged children. This is critical for associate with multiple children in school because the cost can easily be over $20,000 per child per year.  A handful of firms provide full reimbursement, but most firms that do offer tuition reimbursement limit it to $10,000 reimbursement per year per child. We believe that this $10,000 reimbursement will catch on and eventually be offered by most firms (although it may take a couple of years for a majority to offer this). Keep in mind that the handful of firms in HK / China which offer their housing / cola allowances on a case-by-case basis (rather than have a set policy for a certain allowance across the board for all US associates) of course take into account whether an associate has children. A growing trend in the market is more US and UK firms offering their US associates "home leave" benefit on top of the expat / cola allowance.  This benefit is usually economy or business class tickets for the immediate family to anywhere in the world (or in some cases, limited to the associate's home country or US). In other instances it is provided as a cash allowance.   Less than 50% of firms offer home leave assistance, but it is a growing practice. In Hong Kong and China, there is and likely always will be a fierce competition among peer firms for the very best talent available and the top US associate talent will expect a competitive expat / cola allowance. While it is very rare that an associate candidate will choose one firm over another for less than a $20,000 difference in expat / cola, a larger difference will usually be influential in a decision.  If you would like more information on expat / cola allowances in HK / China and other Asia markets, feel free to reach out to us at Asia@kinneyrecruiting.com.

Housing / COLA Allowances in HK and China on the Rise Again

Written by Robert on 29 April 2011. ♦ Associates' Corner, Economic News, Expat Packages, Lifestyle  ♦ Beijing, China, Cost of Living, Economy, Hong Kong, Shanghai

Robert Kinney here. There is nothing like expat package discussion to get our readership up. It seems like we have recently written on this topic, but there has since then continued to be an uptick in housing / cola, as well as a lot of momentum for a cross the board market shift upwards regarding what is considered a competitive expat / cola allowance in HK / China. First, please check out our recent press at CNBC, where our Alexis Lamb is the only recruiter interviewed for the March 7 ’11 article “Law Graduates Head to Asia as IPO, M&A Boom Creates Talent Shortage,” by Ansuya Harjan. We will be featured / interviewed in several other national and global publications regarding Asia biglaw in April as well. Usually when the top US or UK firms in HK / China are considering an expat / cola raise, they will contact Robert Kinney, Alexis Lamb, Yuliya Vinokurova and / or me for information on other expat / cola allowances in the markets, recent changes we have seen, and what we are expecting in the near to medium-term future. We have been taking such calls on a just about daily basis recently. Why are we such a great source of information for these hiring partners?  Well, it is known that we are the market leaders and are the most informed recruiters in the HK / China biglaw market and each year we see offer letters from just about every top US or UK firm in HK / China. Routinely, Robert and I are asked to meet with senior partners in both Hong Kong and New York in order to discuss the state of the lateral hiring market in Asia, including cola / housing allowances. Here is the recent movement we have seen in expat / cola (amounts below do not include sometimes substantial additions for associates with children) in HK / China: Top Wall St. firms: One of these firms has for most of the past five years, including at present, offered its US associates $80,000 USD expat / cola. Up until recently this number has been top market, but in the past six months we have seen several non Wall St. firms blow past that number, including one firm that is $25,000 ahead. The other top Wall St. firms have had expat / cola ranging from $55,000 to $70,000 for the past five years and there was no change in these numbers during the recession or the dramatic boom recovery in China in the past two years. However, things are changing: One top Wall St. firm has just raised its housing / cola from 65k to 75k and two other top Wall St. firms are seriously contemplating raising their expat / cola to over 70k and perhaps to 80k. Other top US firms: This is where most of the recent dramatic housing / cola increases have occurred recently. One of these firms has blown past the rest of the market with a $93,000 housing / cola for single associates and $105,000 expat / cola for married associates. Another firm has raised its expat / cola to $80,000. Both of these firms though have always been very competitive in the HK / China market since they opened their doors, so not so surprising. However, a number of other major US firms which for years were not willing to pay competitive market housing / cola in HK / China are now suddenly offering $80,000 to $95,000 range of allowances. It has been the dramatic upwards movement in housing / cola in HK / China that has really rocked the market. Keep in mind that during the past twenty months, while things have been booming in HK / China biglaw, especially in HK and China IPOs, most of the top US cap markets practices in HK / China have been incredibly busy and also understaffed (due to hiring freezes for ’09 and less than full green light hiring for most of ’10). The hours have been very high and some associates at the traditionally most prestigious firms have begun to consider firm prestige as a less important factor than good work, career advancement potential and compensation. There is more open competition for the best associate candidates and thus with more firms in this competition, brings about more firms with top market expat / cola allowances. During ’09 and the first half of ’10, all international firms in HK / China could count on stellar US associate candidates applying for each opening, but once the number of openings vastly increased in the market, the top candidates on paper (from top 10 NYC firms, native Mandarin, cap markets / M&A) became relatively scarce, as is usually the case. Most top US firms will strive to hire the best available candidates available on the market at any particular time. The vast majority of the partners at US corporate practices in HK / China want high housing / cola for their associates so that they can recruit the best talent. Surprisingly, a lot of US firms’ global management is starting to agree wholeheartedly. Keep in mind that there is also a recruiting race / war going on now in HK / China for senior and rising star partners with huge books of business. These star partners who are open to a move don’t want to join (or remain at) firms that can’t recruit the best talent (so expat / cola allowances for their associates are vital to these partners’ needs too). Further, the cost of housing is on the rise in HK, which ironically is not the most important factor in these cola / housing allowances, but it is an increasingly important factor, as HK landlords in Central and Mid-Levels are asking as much as a 100% increase on lease renewals recently. With the above said, there are still is a number of US firms that refuse to pay competitive expat / cola allowances in HK / China. This number is shrinking but the majority of firms in this group are resolved to not consider high housing / cola allowances. This group includes a few major names that may surprise you, if you did not know the market well. These firms fall into two categories: a) firms that have a strong particular practice in the region and have for years, but have no desire to expand significantly and their clients are going to keep coming to the senior attorneys they have worked with for years; and b) firms that are trying to survive in HK / China by competing on price and thus have small margins to work with, certainly not the kind that would allow the high expat / cola allowances. Magic Circle and other UK firms: Up until recently three of the four magic circle firms have been very competitive with expat / cola for years in HK / China, offering a range of 63k to 79k for since ’07. However, the fourth magic circle firm has also recently joined the competitive housing / cola range, offering as much as 70k allowances recently. A few other UK firms are competitive and others are not. The magic circle firms have become very competitive with the top US firms for US associate candidates in the past two years in HK / China and we don’t see that changing. We expect these firms to raise to 75 to 80k housing / cola if 3 or more of the Wall St. firms do. Additions for children: Most top US and UK firms which pay competitive housing / cola in HK / China will also provide substantial additional allowances for US associates with children. These additions can range from $10,000 to as much as $80,000, depending on the firm. Also, a growing minority of top US firms also provide tuition reimbursement assistance for associates with school aged children. This is critical for associate with multiple children in school because the cost can easily be over $20,000 per child per year. A handful of firms provide full reimbursement, but the market seems to be settling on $10,000 reimbursement per year per child. We believe that this $10,000 reimbursement will catch on and eventually be offered by the majority of firms (although it may take a couple of years for a majority of firms to offer this). Keep in mind that a handful of firms in HK / China offer their housing / cola allowances on a case-by-case basis (rather than have a set policy for a certain allowance across the board for all US associates) and they of course take into account whether an associate has children. As always, feel free to reach out to us at asia@kinneyrecruiting.com if you have questions regarding housing / cola or any other topics with regard to the Asia biglaw markets.

INTERVIEWING FOR ASIA US ASSOCIATE POSITIONS – WHAT HIRING PARTNERS ARE LOOKING FOR IN A CANDIDATE

Written by Robert on 06 February 2011. ♦ Associates' Corner, Interviewing  ♦ Cost of Living

Interviewing for a US associate position in Asia can be quite different from interviewing for a spot down the street in New York or another major domestic market.  Similar to applying at US offices, key determining factors on whether you will have a chance of interviewing are top firm experience and impressive JD academics. The other obvious factor determining whether you will interview, at least for most positions in Asia, is language skills (Mandarin, Korean, Japanese). However, once you are in an interview, whether by phone, VC or in person, your stellar resume is not going to help you as much as it would in a US position interview.  Overseas partners are looking for the right personality fit much more so than in a large domestic office. A major reason for this is because the offices are much smaller overseas, making it harder to hide a misfit (even a junior associate can be the face of the firm), but there are other reasons as well. At a basic level, the factors that are especially important to demonstrate in an interview overseas are these: •     you have an entrepreneurial nature; •     you have a high level of maturity for your experience level; •     you have an outgoing personality (not overly “academic” in nature); •     you are able to fit in with different cultures; •     your personal presentation is generally positive; and •     you are a team player (no prima donnas need apply) •     you have a demonstrated interest / connection to your target market
These are obviously all factors that are relevant in any interview at least as “plus factors”, but these particular factors are especially important in Asia. Keep in mind that within minutes of your first interview, most partners can pretty much figure out whether you have these attributes.  Robert, Alexis, Yuliya or I can figure this out in minutes as well. There is a much less structured environment for associates in busy overseas U.S. practices (at the smaller offices or newer practice groups it can be similar to working in a exciting start-up company, albeit one extremely well financed). The market is such in Asia, especially in China, that firm clients are not nearly as institutionalized as in the major US markets.  Sure, most US firms in Asia opened offices there to begin with, at least in large part, due to following major clients.  However, it is much more of a free for all regarding pitching deals in Asia, especially in China.  A firm not being on the preferred vendors list at an i-bank, fund or other entity does not even prevent representation from happening in Asia.  In China especially, considering all the state run enterprise business, the vast majority of the IPOs being handled by PRC banks, and many emerging companies and funds, there is a lot of pitching going on by firms for this work.  Further, while in New York deals are done mainly over the phone, in Asia there are a lot of in-person meetings throughout the process. Needless to say, there is a lot of client contact for even junior associates, especially when in China a non-Chinese partner may be leaning heavily on his Mandarin fluent associates for a lot more than due diligence.  Mid-level associates in Asia are typically running their own deals. At many instances in Asia your training is one-on-one mentoring from a partner or two, quite commonly with no senior associates in between. Maturity is especially important in Asia because associates are given as much responsibility as they can handle. Simply put, a mature person can balance his or her workload between competing demands more than an immature one.  There can be a lot of travel to meet with major clients and each associate, no matter how junior, is usually a vital part of their office’s overall practice and client development and retention. Each associate is also expected to be a self-starter and figure out things on the fly much more than is the case in a domestic office of the same firm. The smaller offices of course make personality fit and personal presentation more important, for obvious reasons.  As an associate at a top U.S. practice in Asia, you are more of a vital cog in the entire offices’ practice and your personality is going to directly affect the firm’s practice. Senior partners overseas, especially those that moved to Asia from U.S. offices, have in many cases put a tremendous amount of effort (and some career risk) into building their book of business and reputation in a foreign country. Thus, they can take a lot of pride in their accomplishments, as they should. Understandably they want to avoid placing their reputation and practice in the hands of an associate with whom they do not have a strong personality fit or who cannot be counted on to be at his or her best every day. As an associate in a large New York (or other major US market) office, with hundreds of attorneys, you surely know a number of very impressive young associate colleagues who are perhaps a bit over academic, but perform just fine in that large office environment.  However, being too academic and not well rounded will not serve well in an entrepreneurial and less structured environment of a busy small overseas US corporate practice of a top firm.  We have seen countless cases where the less impressive candidate on paper wins out over the more impressive resumed candidates, due to being better rounded and the right personality fit. Most US partners who have been in Asia for a few years or more have experienced a hire gone bad simply because the US associate ultimately could not commit to the geographic market.  Asia, especially China, is hot now and is the place to be sort of speak, and there are many very well intentioned and able young professionals in the US who believe they would like to relocate there, but ultimately find out later that the region is not for them.  Thus, many US partners will take a jaded approach into an interview with a US associate who does not have an obvious connection to the particular target Asia market.  Of course, a connection to the market is not a requirement to land there (if it were, most partners you are interviewing with would never have landed there to begin with), but the lack of a strong connection will need to be dealt with in an interview.  It is ok to want to be in Hong Kong, for example, because it is an exciting market, has great deal flow, and you have visited there a few times, but the message has to be conveyed loud and clear in an interview and you need to be prepared to take on this red flag head on. Keep in mind that U.S. firms have more risk with hires they make overseas, due to the high level of responsibility each associate has, and also because associates are simply less fungible in small busy overseas offices.  The past two years of economic downturn in the west caused full and partial hiring freezes at firms globally, even during most of the recent 20 months boom in China. Many U.S. practices in Asia have found themselves to be severely understaffed when just one or two associates leave, combined with increased deal flow. In a busy and competitive lateral hiring market in Asia, it can easily take a U.S. practice up to six months to replace a key associate that has not worked out. Further, there is the added cost a firm takes on when hiring a U.S. associate lateral, especially if from the U.S. markets, such as annual housing / expat packages (which can run from $40,000 to $140,000 depending on the Asia market and firm) and international relocation costs, which includes up to two months in a luxury serviced apartment. Some firms even handle private school tuition for associates’ children.

Expat Allowances are Going Up at the Top End in HK / China

Written by Robert on 04 November 2010. ♦ Expat Packages  ♦ Beijing, Cost of Living, Hong Kong, Shanghai

Robert here. Please note that Robert Kinney and I will be back in Hong Kong all next week for meetings. Although our schedule is tight, we can fit in some meetings with prospective biglaw or in-house candidates. Feel free to reach out to us at asia@kinneyrecruiting.com. In just the past few weeks, we have seen a noticeable rise in the expat / cola allowances for US associates at some of the most competitive group of US and UK firms in HK / China. In fact , it appears that for the first time $80,000 may be taking hold as the eventual standard in HK / China. For the past several years, while there were anywhere from zero to four firms paying as much as $80,000 expat / cola for associates with no children, most of the top US and UK firms remained in the $60,000 to $65,000 allowance range. The competitive range continues to be $60,000 to $80,000, but more firms are at the top of that range than ever before in HK / China. Further, two top US firms pay $90,000 expat / cola (although one of those has tax equalization on the base). While there has been already a trend in ‘10 for a number of the US and UK firms with less competitive expat / cola allowances to step it up (see http://www.theasiachronicles.com/archives/2264), there has until very recently not been much movement in the competitive group, most of which have allowances in the mid $60,000’s (keep in mind that many major US and UK firms are still not in that competitive expat allowance range of $60,000 plus, but the size of that group is becoming smaller). Further, we are seeing a trend this year of the top US and UK firms paying their US associates in mainland China the same expat allowance as their US associates in HK receive (some firms still give a smaller allowance in the mainland than in HK, but we are seeing this much less often than in previous years). Two of our four placements in HK / China last week received expat / allowance at $80,000 and we are aware of a few firms recently raising their allowance from the mid $60,000’s to $80,000. Further, at firms where expat / cola is determined on a case-by-case basis (up until this year, that has almost always meant a very low allowance or no allowance), we are seeing a surprising trend for top market expat / cola being offered. For example, two of our recent placements in HK received $80,000 and $70,000 expat / cola, respectively, in HK at firms which have only recently started to pay competitive expat / cola consistently and which determine allowances on a case-by-case basis. Sure, there was negotiation involved and those two new hires had leverage due to being extremely marketable, but the allowances offered were well above market. In only the past couple of weeks two of our firm clients have raised their expat allowances from $65,000 to $80,000 USD in HK / China, near top market, and other firms are considering doing the same. This is not a surprise, considering the competition now for the best US associate candidates on the market is fierce. A number of firms have reached out to us for help keeping up with the changing expat / cola numbers in the market, due to rumors going around that some top firms are raising their allowances. As recently as mid ’09, the highest US associate expat allowance in HK / China biglaw lowered to $70,000 (for associates with no children), after the two firms that were paying $80,000 allowances dropped to $65,000. Before the global economic downturn hit China in late ’08, the expat allowances in HK / China had been on a steady rise, with many firms doubling their allowance over a period of just a few years. But in ’09, even as the China IPO market rebounded dramatically in midyear, expat allowances were taking a small step back. It appears now that expat allowances are on the rise again, due to the competition heating up among top US and UK firms for the best US corporate / cap markets associates on the market, both those coming from the US and those already in HK / China.