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LAW OFFICE MANAGEMENT It's still Partner compensation models may be changing but for the most part money remains the prime motivator. BY KEVIN MARRON keeping with the goals and culture of the firm. But, in today's highly com- petitive legal marketplace, many are finding their best efforts undermined as other firms seek to lure key partners with exorbitant pay packages. "It's a very real and immediate problem that law firms face right now. It's one of the things that keep managing part- ners awake at night," says Scott Jolliffe, chairman and chief executive officer of Gowling Lafleur Henderson LLP. "It's creating an uncomfortable dynamic in the marketplace." Firms that are expanding, seeking F ew things are more difficult or contentious for law firm managers than arriving at the fairest possible partner compensation scheme in to fill a gap, or satisfy a particular need that's important to them are will- ing to pay above market compensation rates to acquire people, says Jolliffe. This puts tremendous pressure on a law firm's compensation system, he explains, because you may end up pay- ing large sums to retain people who are being courted, thus creating internal inequities in your partner compensa- tion scheme. Fairness and equity are the funda- mental principles behind almost any partner compensation scheme. In most compensation systems, some partners will inevitably earn less than others on the basis of their overall contribution to the firm and they will accept that as long as they are satisfied that each partner's pay is calculated on the same basis. But 22 JUNE 2011 www. CANADIAN Lawyermag.com they will certainly feel shortchanged and may well nurse a grievance if they see other partners earning significantly more purely because they are threaten- ing to jump ship, thus jeopardizing the interests of the firm in pursuit of per- sonal gain. And, if partners lose faith in the fairness of the compensation sys- tem, it could undermine much of what their firm is trying to achieve. Bill Tuer, managing partner at Macleod Dixon LLP in Calgary, describes the compensation system as "the largest tool the law firm has to motivate and change behaviour." And, he adds, the key to ensuring partner buy-in is to ensure the system is pre- dictable and consistent. Ask almost any law firm manager, consultant, or recruiter and they will eat-what-y ou-kill Jeremy BruNeel