Magic circle Freshfields ousts equity partners amid US push
Senior staff are bracing for a shake-up at magic circle law firm Freshfields, as partners have been forced out to boost growth and fund its US expansion.
The City-based firm has ousted several equity partners in recent weeks across several European offices, including London, according to the Financial Times, as it focuses on growth.
Speaking to City PM, Christopher Clark, director at Definitum Search, said: “This move seems logical. It’s likely that the partners affected will still be paid very well, and now delivering a healthier profit margin for the firm.”
This move comes as the elite legal giant also introduced a strict performance-based compensation system last year, stripping equity points from long-serving European partners to compete with rivals in New York, where top talent commands up to $20m a year.
The overhaul of its remuneration structure was designed to fund its aggressive expansion in the US, as Freshfields joins rival elite English law firms in a pursuit of rapid expansion across the Pond.
“The reality is that firms competing at the very top of the US market need greater flexibility to reward their highest-performing partners. Traditional lockstep systems can struggle to accommodate that. What we are seeing is the continued influence of US compensation practices on the leading UK and international firms,” Nick Woolf, partner at Woolf&Co, told City PM.
Freshfields was approached for comment.
Magic circle targets American market
Freshfields reported a 6 per cent increase in global revenue to £2.3bn for the year to April 2025, but it posted a two per cent dip in pre-tax profit of £656.8m.
Its US revenue surged by 21 per cent year-over-year to £473.3m in 2025, up from £391.1m in 2024, as its American entity now accounts for around 21 per cent of firmwide global revenue. Freshfields now operates five US offices: New York, Washington, DC, Silicon Valley, Boston, and San Francisco.
The firm admitted 88 per cent more US lawyers into the partnership this year than in 2025, while its London figures only increased slightly over the same period. Over 2025, Freshfields made nine partners in London, bringing the total to 11 this year. But over the same year, it made only 3 partners in the US, compared to 13 this year.
Although it no longer publishes its profit per equity partner (PEP) figures, Freshfields’ recent total profit share and remuneration shared among the core management group ( including senior partner, managing partners, and heads of the global practice groups) was £25.8m for 2025, down from £26.2m in 2024.
The average PEP at elite New York law firms ranges from $5m to over $12m.
Last September, it was reported that the magic circle giant had kicked off a round of redundancies targeting paralegals at its Manchester office.