By Murray Gottheil | June 26, 2025
There were good things about the old days when law was primarily a profession, and lawyers joined law firms with a view to learning, working hard, and becoming partners. One of them was that law firms cared about their associates progressing, developing clients, and becoming self-sufficient.
When we decided that the practice of law is also a business, we became obsessed with lawyers earning their keep. We paid them a salary and expected them to bill and collect at least three times that amount. For that salary, we paid their expenses and gave them a marketing budget and some business development training. We tied their compensation to their billings and client origination credits. The more they billed and brought in, the more they earned. It was all a bit mercenary, but at least the interests of the firm and the employed lawyers were aligned. Things may not have been perfect, but they sort of worked.
What has provoked this nostalgic romp is yet another conversation that I had with a lawyer who works for a small firm where the partners earn a lot of money on the backs of several very lowly paid associates. How lowly paid? The traditional benchmark in the legal profession that a lawyer should earn one-third of their collected billings would be pie in the sky to these associates.
Arguably, there is nothing wrong with firms hiring new lawyers for a pittance, teaching them their craft, and increasing their compensation as they become profitable. I am good with all of that. The problem that I have is that after three to 10 years, these lawyers are still earning significantly less than a third of their billings. They are churning out work that partners are putting on their desks. They are not being encouraged to develop a practice. Management is happy for them to generate billings at the lowest cost that they can pay for their work, and then to replace them when they wise up and leave.
The answer, of course, is for these folks to develop a client base and move on, but it seems to take them a while to figure that out. I suspect this is because they are disproportionately first-generation (and often internationally trained) lawyers who do not have networks in Canada that allow them to secure better jobs when they start out or help them figure out that they are being taken advantage of. There may also be a wee bit of prejudice involved.
Bertrand Russell said, “Advocates of capitalism are very apt to appeal to the sacred principles of liberty, which are embodied in one maxim: The fortunate must not be restrained in the exercise of tyranny over the unfortunate”.
Nonetheless, perhaps we could, at a minimum, teach the new folks how to recognize the tyranny in the profession. Or even better, we could do something about it! To get the howls of indignation and accusations that I am a socialist started, I will suggest making it professional malpractice to underpay employed or contracted associates.
Murray is a happily retired lawyer who lives in the country, drives a pick-up truck, writes, teaches and mentors. You can reach him at murray@murraygottheil.com or see what he is up to at lawanddisorderinc.com.
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