Will I Be Getting an Expat Package / Cost-Of-Living Adjustment?
The short answer – if you’re a U.S. JD – most likely yes.
Now that we’ve got that out of the way, let us tackle some FAQs surrounding expat packages / cost-of-living adjustments (or “COLA”).
How Big Is My Expat Package?
It depends.
In Hong Kong, expat packages can range from US$30k to US$80k or more. Some firms determine expat packages on a case-by-case basis, most firms give their US hires a standard expat package.
There may be some deviations between COLAs offered in Hong Kong and mainland China, but those are minimal.
Most firms in Singapore do not give COLA. There are some exceptions, but COLAs in Singapore are much smaller than COLAs in Hong Kong.
Why Is Your Expat Package Bigger Than Mine?
Sometimes, two US associates at the same firm could be receiving expat packages of different sizes. Why?
First, at some firms, senior associates get a larger expat package than junior associates.
Other firms give attorneys a COLA bump for each child to account for the costs of sending children to local private schools, as COLA has historically been used to address these types of cost-of-living differentials.
How Is COLA Paid?
Firms will pay your COLA as a cash lump sum on top of your salary in each paycheck.
How Long Will I Keep Getting COLA?
Some firms are beginning to implement sunset provisions, i.e. they will only pay attorneys COLA for a certain number of years (typically 4 or 5) before the COLA phases out. This is not common or market standard, but it would not surprise us if more firms start to consider a “sunset clause” on their COLA.
I’m an LLM – Do I Get COLA?
If you are currently a US Associate at a firm in the US, you will get a COLA in Asia.
If you’re coming from within Asia, you will likely get COLA if you are already receiving COLA at your current firm.
Some firms have a policy where LLMs need to work at the firm for one year and “prove themselves” before being granted a COLA. Other firms make COLA determinations for all their hires (not just LLMs) on a case-by-case basis.
I’m a Foreign Legal Consultant. Will I get COLA if my firm promotes me to US Associate?
If a firm initially hires you as a Foreign Legal Consultant (“FLC”), Legal Manager, or other pre-Associate role, you will not get COLA unless and until you are promoted to full US Associate and paid on the “Cravath” scale. Even then, there is no guarantee that your firm will pay you COLA.
We have seen many cases of firms promoting high-performing FLCs to US Associate, yet not giving them COLA.
What About Non-Cash Benefits?
About half of the firms in the market will cover the costs of economy class air travel for the attorney and their family back to their home country.
It’s becoming less common for law firms to pay for their attorneys to fly home in the front of the plane, so don’t expect the business class treatment.
Another extra is School Tuition Reimbursement. Some firms will reimburse a portion of school tuition expenses for all school-aged children.
What About Relocation Expenses?
Some firms cover all customary moving expenses, and other firms will give you a cash stipend – typically $5,000-$10,000 USD – to help with relocation.
Upon arrival in Asia, your firm may arrange for you to stay in a serviced apartment for a period of time (likely 2 weeks) before you find your own flat. The firm will also provide you with contacts for real estate agents, so you can easily settle in to your new city in a place of your own.
What About Local Hong Kong-Qualified Attorneys?
It is not customary for local Hong Kong-qualified attorneys to get a COLA adjustment (they are from Hong Kong, after all).
However, to attract top Hong Kong-qualified attorneys, some top New York firms will offer them a full COLA.
Other firms will offer COLA on a case-by-case basis for Hong Kong-qualified attorneys if they pass the New York bar.
How did COVID-19 Affect COLA Policies?
Post-COVID job offers still contain COLA in line with firms’ pre-COVID COLA policies.
However, some firms have been using COVID-19 as an excuse to re-evaluate their COLA policies, but there has been little change for practical purposes.
Be prepared to negotiate for COLA if it is not initially in your offer letter, but the vast majority of firms will still grant COLA to associates in the end. Our team is very experienced with obtaining successful results for our candidates in these COLA negotiations.
If you are interested to learn more about what’s currently “market” with respect to law firm expat packages in Asia, please reach out to our team.
