Allen & Overy
Published May 2011
2011 Vault Ranking: 35
Allen & Overy is both among the most prestigious of London’s Magic Circle law firms, as well as one of the largest law firms in the world. It is among the international elite, with 2,700 attorneys in thirty-six offices around the globe, and one of the highest revenues of any law firm. An international specialist, the A&O New York office only began advising on US law in 2000. The firm specializes in financial and international transactional work, but also has an excellent litigation team in New York.
Allen & Overy was founded in 1930 by George Allen and Thomas Overy, both of whom were already experienced practitioners and formerly partners at another prominent London firm. The firm’s reputation quickly grew thanks to involvement by Allen as King Edward VIII’s advisor during the abdication crisis of 1936, though the firm remained primarily a commercial practice. A&O operated only out of a single London office until 1978, but a significant portion of the firm’s clients were Canadian banks and corporations, setting it up for a future as a preeminent international player.
Beginning in 1978, and continuing through today, Allen & Overy has expanded dramatically, opening dozens of offices across Europe and Asia. Notably, the firm has a very limited presence in the western hemisphere with only a New York and Sao Paulo office. Though the New York operation started slow, it is now profitable, pulling in over $100 million in revenue annually, and playing host to 150 attorneys. While the firm’s reputation is for its international transactional work, the New York office quickly gained notoriety for an elite litigation group, and has played roles in numerous prominent government investigations in the financial sector.
Allen & Overy weathered the global financial crisis as best they could, but their primary practices in banking, finance, and international capital markets were hit very hard. The firm laid off around nine percent of their attorneys and staff in each office, as well as instituted a salary freeze. The firm also implemented lower billing rates in an attempt to retain and acquired business. In 2010 the freeze was lifted, and the firm is cautiously optimistic for the future.
Allen & Overy’s overall practice is extremely varied, as one would expect in such a large firm. But it is most well known for its international transactional work. The firm has been advising banks and corporations around the world since its founding, and has gained a reputation as being among the global elite in their field. The vast majority of the New York office is transactional attorneys, broken into three general groups: Capital Markets, Projects, and Corporate/M&A.
The capital markets team has redefined itself in the wake of the economic collapse. It has picked up a significant amount of restructuring work, including working with the International Swaps and Derivatives Association on matters of credit default swap contracts and creation of a new structure for settlement of credit events. The projects group is among the leaders in North America for public/private partnership project financing and development. The Corporate/M&A group is well regarded, and not focused only on the American market. It serves both international clients investing in the US, as well as American clients investing abroad.
A&O is not particularly renowned for its litigation work overseas, but the New York office features a very accomplished team that is small but growing. Heavily related to its other practices, the litigation group primarily focuses on financial services litigation and government investigations. It had been involved in all manner of securities litigation, complex commercial litigation, regulatory investigations, and even white-collar defense. It represented BAE Systems in negotiating one of the largest settlements ever with the Department of Justice, as well as representing Goldman Sachs when it negotiated one of the largest fine settlements ever with the SEC: $550 million.
Allen & Overy’s Vault ranking of 35 overall is a tribute to the strength of the firm, given that Vault rankings are traditionally America-centric, and more specifically, New York-centric. This is despite only having 150 attorneys in New York. The firm is also ranked number 9 overall for international work.
Chambers and Partners ranks Allen & Overy either nationally or in New York in Band 1 or 2 for the following practices: Capital Markets, Corporate/M&A, General Commercial Litigation, Projects.
As with any firm, Allen & Overy cares a lot about grades and your law school institution of choice. Many UK firms have a reputation for elitism, primarily hiring from the two stalwarts, Oxford and Cambridge. When hiring US trained attorneys to practice advise on American law, a similar approach is taken, with only applicants from the top fifteen or so schools even being granted interviews. The New York office, staffed primarily by Americans, is somewhat more willing to look at top students at lower ranked schools. Regardless of the office, the firm is looking for someone who has an international focus and a real desire to work in that area, especially in the transactional groups. This however is balanced against a desire to avoid hiring “legal tourists,” people who just want to travel the world on the firm’s tab and are not truly committed to the job. Language skills and an international background are strong plusses, and the firm prefers to hire associates who have had work experience in addition to their educational credentials.
US summer associates can be placed in New York, London, or Hong Kong, as each of those offices performs significant work involving American law. Associates can be given the opportunity to split between two offices, and the firm does the best to match summer associates with practice areas they are most interested in. Work assignments are intended to match the work of a first year associate in a particular practice area, though not to the same workload. In New York, the program is typical for any other large firm, involving common social events like Broadway shows, Shakespeare in the Park, and a boat cruise around Manhattan.
In 2009, A&O made permanent offers to 34 of its 35 summer associates. The incoming class of 2009 started on time in September of 2009.
Compensation and Benefits
Allen & Overy pays US associates on the standard market lockstep scale, with first year associates starting at $160,000. While there was a salary freeze for a brief period in 2009, it has since been lifted and salaries have returned to market levels. The firm generally matches the market leader for bonuses in New York. Bonus amounts are also lockstep.
The firm has no billable hour requirement for bonus eligibility, but associates are generally expected to bill between 1,800 and 2,100 hours. This amount, though slightly lower than some other more elite American firms, is on part with the expectations of other European firms with New York offices. There is no real penalty for failing to meet billable hour goals, though consistent underperformers may be in trouble if the firm is forced to make another round of layoffs at any point.
The firm tends to not focus on face time as long as client needs are being met. However it should be noted that like in any large firm, there are some senior associates who do not fit this rule. As such, associates are best advised to learn quickly who those people are. The firm offers four weeks of vacation time, with the option of buying or selling up to three days of annual leave. Like most firms with European roots, the firm is very respectful of planned vacation time, and it is very rare for work to interfere.
Other benefits vary by office, but all associates receive standard relocation expenses and bar reimbursement, as well as expatriate packages for US attorneys working overseas. There is no formal budget for client development, but associates may have expenses reimbursed on a case-by-case basis. The London office features a cafeteria, gym, bar, and on-site doctor, as well as numerous other services.
Allen & Overy has a two-tier partner track. Attorneys are eligible for equity partner consideration after eight to nine years. The firm has an unofficial up or out policy. Senior counsel may be considered for partnership the following year if they don’t make it on the first try, but if they are again passed over they are encouraged, though not technically forced, to leave. Associates have a relatively strong belief, compared to many other major firms, that partnership can be obtained through hard enough work, though given the size of the firm and the number of partners promoted each year, the odds are still not in any one individual’s favor.
For an elite firm, the 150-attorney New York office of Allen & Overy is relatively small by New York standards. This, combined with a tendency by the firm to staff projects as leanly as possible, means that associates regularly establish close relationships with senior associates and partners within their groups. The firm encourages collegiality and socialization that may not otherwise be present in larger, more hierarchical firms. Associates also regularly continue to socialize with their class peers outside of work. The things that the firm looks for in hiring create a group that is both very diverse, but at the same time cares about many of the same things, creating a culture of common interests.
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