Lawyers’ pay cut in harsh virus verdict

Cartoon: Rod Clement.

Things are really tough when the partners at one of Australia’s big six law firms have to take a mooted 50 per cent pay cut as part of measures to weather the COVID-19 storm.

The 270 partners at Minter Ellison have just seen their pay slashed, for some back to around $1m a year, as they prepare for the end of their multi-million-dollar world.

You’d think their insolvency and restructuring lawyers would be in very high demand as they include some of the best in the country, including Michael Hughes and Brendon Watkins.

And surely there’s strong demand for their advice on the legal risks for employers now that most of the country’s workforce is home-based.

But Minter Ellison’s chief executive, Annette Kimmitt, is anticipating revenue falls of up to 40 per cent, so its 2500 permanent staff have also been asked to take part in a leave purchase program, which involves cutting salaries by around 15 per cent for the rest of the year in exchange for an extra six weeks of so-called COVID-19 leave.

Meanwhile, staff at law firms working from home across the country have had their spirits lifted by quirky home office HR initiatives.

Clayton Utz rolled out software to maintain employee health and wellbeing during the crisis. Over 400 movement and exercise programs are now offered to its employees through the Body IQ app, including stretching, ergonomics and posture programs.

A psychological wellbeing program called The Resilience Box is also available.

The Lawyerly website advises that Shine Lawyers is set to provide its staff with access to online yoga classes to promote physical and mental wellbeing.

Robes remain

But some formal legal practices are not for turning. Barristers in the latest ACCC versus Kogan court dispute have been told they need to front the video court in their traditional robes.

Federal Court judge Jennifer Davis has consented for the case to proceed next week with ­barristers in their home offices or chambers as the court implements its virtual video solution to the COVID-19 crisis.

But their formal robes will need to be seen down the video cable — via Microsoft Teams, rather than the trendier platforms like Zoom and House Party.

All court procedures will strictly still apply, with any testimony given by video link requiring the swearing of an oath.

The ACCC claim is that the Kogan allegedly duped retail customers, by increasing prices before offering a 10 per cent discount.

Post purge

Controversial Australia Post boss Christine Hol gate is still turning up to work each day at the group’s Sydney office.

The way things are unfolding, soon she might be the only one.

In a bid to diminish the financial impact of the unfolding coronavirus international health crisis on the government entity’s accounts, she’s ordered staff at Post headquarters to stay away over what will be an Easter shutdown of operations similar to that which Post enacts over Christmas.

That will save some money, but in a bid to shave back even more costs she’s asked those staff whose work has dried up — like folks in recruitment and IT projects — to take a further two weeks off to save even more money to help prop up Holgate’s bottom line.

Those who are out for the extra time will be able to access annual leave, long-service leave and purchased leave to cover the time off, which they’ll basically have to spend at home practising social isolation during the health crisis.

This follows news on Wednesday that Holgate was to farewell her well-regarded executive general manager of international Annette Carey, who was former CEO of billionaire Lindsay Fox’s Linfox, at the end of the month after an executive reshuffle.

Another day, another senior member of Holgate’s team out the door. But the frequency of the executive departures has done nothing to reduce the internal shock of Carey’s exit.

Thursday, two more execs were set to be shown the door — one a key customer service general manager and the other an experienced operational general manager affected by this week’s reorganisation.

Word around Post is that the former Blackmores boss is working towards permanently standing down 25 per cent of HQ staff, citing COVID-19 as the reason.

That’d be awkward, given her shareholder is spending hundreds of billions to keep as many Australians as possible in work.

Maybe Holgate is seeing the health crisis as an opportune time to implement the cost-reduction recommendations from the review of Post undertaken by the consultants from BCG?

Time will tell.

King’s reign

It’s been a landmark week for no-longer-retiring Westpac executive Peter King.

Last Friday the still acting bank boss turned the big 5-0.

Social distancing and isolation put paid to anything but a small immediate family celebration at home in Paddington, led by his Commonwealth Bank global markets exec wife Keryn Thompson.

We are told King, Thompson and their two children enjoyed a takeaway celebratory Italian meal that met all social distancing rules.

Then on Thursday King was named as the now permanent boss of Westpac under new chairman John McFarlane.

Quite the double.

King is on a base pay of $2.4m a year, which is pretty close to the $2.6m base that sacked boss Brian Hartzer got in FY2019.

It’s is up from the $1.2m in fixed pay that he got last year as Hartzer’s CFO. Plenty to celebrate there.

Still, the new big four chief isn’t entirely stoked.

King is a St George fan when he’s following the NRL and Swans fan when he’s watching the AFL, and is accordingly particularly unhappy that thanks to the coronavirus he’s unable to go to (or watch) any live footy.

King has been at the bank since his mid-20s, starting his career there doing financial accounts for the derivatives department in Westpac’s institutional bank.

Meanwhile, the online Wentworth Courier website, published by News Corp Australia, has reported Hartzer and wife Georgiana secured a bit under $18m for their Vaucluse trophy home last week.

Cook’s tour

It’s been a turbulent year already for media agency oOh! media.

But they’ll be keeping on their founder Brendon Cook, the company’s chief executive since it was founded over three decades ago, in an attempt to minimise disruption due to the impact of COVID-19.

He will be staying on “until at least the end of this year”, an oOh!media spokesman told Margin Call. However, the search for the new chief executive will still be ticking along.

“The company’s search firm is still engaged, and currently working to assess the market and identify potential candidates,” the spokesman said.

“This will ensure the company is well-placed to appoint a successor to Brendon in 2021.” Cook announced his departure in January, around the time the proverbial wheels started to fall off. A month later oOh!media announced a profit hit of 23 per cent, which saw shares fall even further.

Since the turn of the year shares have plummeted 78 per cent to 65c, down from the 2020 opening of $3.07.

Some of the company directors, however, have taken the opportunity to show their support while share prices are at an all-time low.

Three non-executive directors, Tim Miles, David Wiadrowski and Philippa Kelly, who all only joined the North Sydney-based media agency board last year, recently bought shares.

Miles committed to the purchase of 140,000 shares, an outlay of $82,500, which has taken his stake to 176,000.

Wiadrowski and Kelly were buying their first shares in the company, both securing 50,000 shares for just over $30,000.

Last week oOh!media launched an institutional equity raising, which was oversubscribed in just a week, and raised around $156m.

The company’s largest shareholder, investment management firm HMI Capital, maintain their enthusiasm for the company. HMI’s founder and managing partner Mick Hellman will join the oOh! media board following the completion of the institutional entitlement offer as a non-executive director. OOh!media will be also seeking another two board members.

Thursday oOh!media’s retail raise, aiming to get $11m at a reduced 53c a share, began.

All the directors who are shareholders will participate.