Canadian Lawyer

February 2010

The most widely read magazine for Canadian lawyers

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LAW OFFICE MANAGEMENT Unlocking lockstep N The future of associate compensation is slowly moving away from the traditional model. BY K EVIN MARRON ow that several U.S. law firms have run away from the lockstep model for associate compensa- tion, many Canadian firms are looking to move in the same direction, though not at the same pace. "It's something that firms need to do," says Herb Isherwood, managing part- ner at Vancouver-based Bull Housser & Tupper LLP. He is investigating issues involved in associate compensation in preparation for a conference of manag- ing partners he is helping to organize later this year. The key question he and his peers will confront is whether to abandon the traditional lockstep model whereby all associates called to the bar in the same year receive the same base pay. His preliminary conclusion is: "Every firm will probably move in this direction, some faster and more radically than others." The reasons for making this shift are compelling, according to Samuel Schwartz, managing partner at the Toronto office of Davis LLP. His own opinion — not necessarily that of his firm — is that lockstep is a valuable model for compensating associates in their first and second year, since it 22 FEBRU AR Y 2010 www. C ANADIAN Law ye rmag.com starts everyone off on a level playing field and encourages collaboration at an early stage. But after the first two years, he says, "I think lockstep is going to go by the wayside." That is because law is a business, and lockstep "mitigates against the entre- preneurial spirit," says Schwartz. Rather than having associates locked into a certain pay level irrespective of how much initiative they show, he main- tains that it makes sense to measure and reward performance, thus motivat- ing associates to understand and help develop the firm's business. "And, in MATTHEW DALEY

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