Slater & Gordon wields cost-cut axe

About 85 staff will feel the impact of cost cuts and structural changes at embattled law firm Slater & Gordon.

Slater & Gordon chair John Skippen

Troubled law firm Slater & Gordon says seven per cent of its Australian employees will feel the impact of cost cuts and structural changes.

The firm (SGH) today released a proposed transformation plan as part of a major operational review, following a $546.8 million loss for full-year 2107.

The cuts are expected to affect about 85 of 1210 local staff across 54 locations.

It comes after Slater & Gordon’s board recently approved a debt-for-equity deal which will see a consortium of hedge funds take control of the law firm, and a recent $4 million payout to disgruntled shareholders in a legal settlement.

In a statement, the firm said the changes will impact a number of office locations but its national office network would be largely maintained.

“The company believes that the implementation of a business-wide transformation plan, including cost reductions and structural changes, is necessary for the future sustainability of the Australian operation,” the statement said.

Slater & Gordon refused to comment further, including on details of cutbacks.

A debt-for-equity deal late last month saw Slater & Gordon effectively pass into the ownership of a consortium of hedge funds led by Anchorage Capital Partners.

The deal, which will see the board cleaned out and existing shareholdings smashed, will need to be approved by shareholders at an investor meeting in November.

Slater & Gordon landed in debt in 2015 after striking a $1.3 billion deal to buy the professional services arm of UK company Quindell.

In July, the firm agreed to a $36.5m settlement of a shareholder class action launched by rival firm Maurice Blackburn, after the firm’s share price plummeted following the Quindell purchase.