Bay Street is handing out raises to articling students at a frenzied pace // On the Record

“The cost of living, housing, tuition and billing rates have all gone up. Firms are catching up”

By Mai Nguyen

On Tuesday December 3rd, 2019


It’s a well-known truism that the legal profession is slow to change. For more than a decade, most articling students on Bay Street earned a weekly salary of $1,450. The same two firms, meanwhile, stood out in front.

At Davies Ward Phillips & Vineberg LLP, students pocketed $1,600, and at Bennett Jones LLP, compensation sat at $1,700. No firm wanted to break the monotony. But over the past two years, a wave of salary hikes has swept across Bay Street. At the largest firms in Toronto, most articling students now earn a standard weekly salary of $1,700. Four firms hold a lead over the competition, including Fasken (at $1,800), Bennett Jones (at $1,850) and McCarthy Tétrault LLP (at $1,900). The new market leader is Davies, which, remarkably, increased its student compensation to $2,250. That translates into an annualized salary of $117,000, a massive number that outstrips the $110,000 that most associates earn in their first year on Bay Street.

Seriously: what’s up with all the raises? “It was time,” says Nancy Stitt, a partner at the legal recruitment company Stitt + Zosky, and the former director of student programs at Goodmans LLP. “Associate and student salaries hadn’t been raised in 10 to 15 years. The cost of living, housing, tuition and billing rates have all gone up. Firms are catching up.”

In the legal profession, there is a strong herd mentality. “Once one or two firms jack up their salaries, other firms are going to fall in line to keep pace,” says Jordan Furlong, the principal of the legal-consultancy firm Law21. “Many firms are simply playing follow-the-leader.”

Competition in the job market is also a factor. In the wake of the 2008 financial crisis, the largest firms had no difficulty landing and retaining top talent. In the current economy, however, that is no longer the case. The best of the profession can now migrate to the business community — in, say, the world of technology or finance — where the number of well-paid positions is on the rise. Through increased student salaries, Bay Street is hoping to purchase a bit of loyalty.

Furlong, for his part, is critical of a retention strategy hitched solely to compensation. “It’s true that, when you raise salaries, the candidates you want are more likely to say yes to your offer,” he says. But in his view, firms haven’t thought deeply about how to increase job satisfaction among their rank and file. “To hope that money will solve the problem is short-sighted.”

This story is from our Winter 2019 Issue.

Illustration by Konor Abrahams