Lateralling from Canada to the US

canada US

The migration of Canadian associates to the States is something of a specialty for Kat Komarnicki of recruitment firm Jowers Vargas. Here she tells us all about the process of lateralling south of the border.

Rhia Lyon, January 2022

Chambers Associate: Why did you decide to start recruiting Canadian candidates for US law firms?

Kat Komarnicki, partner at Jowers Vargas: I started recruiting in 2016, focusing primarily on New York and California. After a couple of days cold calling associates in New York and not getting very far, I decided to try calling Canadians. I figured that since Canadians are so nice, the associates in Toronto were less likely to hang up on me mid-cold call. Not only was everyone very nice, but they were also very talented: deal teams in Canada – especially in Toronto – are staffed more leanly than in the US, so juniors and mid-levels get very solid experience early on.

I started visiting Toronto in 2016 and would meet with about 20-30 associates in three days. At that time, their billable hours weren’t close to what’s expected at New York BigLaw firms – there’s a big difference between billing 1,700 and 2,100 hours a year. Eventually that margin became a lot smaller, and US associates were still making twice as much money, so lateralling over was a no-brainer for many associates.

CA: Why are Canadian candidates appealing to firms in the US?

KK: When I first started recruiting Canadians, the market was so competitive that most firms didn’t need to look to other jurisdictions for recruitment, so only a select few firms would interview my candidates. If firms did hire from Canada it was often because there was a referral or another strong connection with the candidate.

“It’s only taken one or two strong Canadian hires for firms to say, ‘Hey, the talent is really strong, keep ‘em coming!’”

When this crazy hiring spree started, firms were forced to broaden their scope and look at a wider range of candidates. It’s only taken one or two strong Canadian hires for firms to say, ‘Hey, the talent is really strong, keep ‘em coming!’ Firms that I had never placed Canadians at previously now call me and ask for them specifically.

The ease of the TN Visa has also driven US firms to look toward Canadian hires during the past year. Compared to other visas, it’s a short processing time, then you gather a few documents, pay $50 at the border, and you can start working right away. It’s a pretty seamless visa process compared to other countries.

CA: What sort of opportunities are typically available to candidates from Canada?

KK: Canadians often think that if they’re going to move to the US they can only look at tier-two or -three firms, but the most prestigious BigLaw firms have historically been the most interested in Canadian associates.

In terms of practice areas, corporate is the biggest player: M&A – private M&A in particular – as the skills are very transferrable. Finance, ECVC, intellectual property, capital markets, and real estate associates are having great success in this current lateral market as well. Litigators coming from Canada have a tougher time, although I’ve placed a few litigators from Toronto and Vancouver to New York this year.  

“US firms are really interested in junior associates from the few Canadian firms that specialize in emerging companies and venture capital work.”

US firms are really interested in junior associates from the few Canadian firms that specialize in emerging companies and venture capital work. Roles at these firms are extremely competitive, but can be hard to fill as most of the associates going for them – already in the US or otherwise – typically don’t have direct experience. So when someone is coming from a top ECVC firm in Canada, that gets the attention of firms like Cooley, Fenwick, Gunderson, and Latham.

Because the leading ECVC practices in the US groom associates so well for in-house moves, there’s a lot of attrition at the mid and senior level. If US associates are planning on going in-house from one of these platforms, they aren’t likely to lateral to a peer firm, so one way to fill the gap is to recruit from leading ECVC firms in other markets.

One associate told us… I was at one of Canada’s Seven Sisters in the corporate group. Back there, the group did a broad mix of work but people in the US tend to focus a lot more, so now I almost exclusively do M&A in a large global firm in San Francisco. I love seeing how our global platform works, like dealing with Italian counsel in our Milan office. Some Canadian firms might have a satellite office here and there but they often need to loop in lawyers who aren’t part of the firm. Here, I have resources and colleagues around the world.

“Getting dual qualification also means you have a better shot at making partner if you do decide to move back to Canada.”

CA: Aside from the jump in salary, what’s attractive about a career in the US?

KK: Canadians are drawn to the top US markets because the deals are more sophisticated. Getting dual qualification also means you have a better shot at making partner if you do decide to move back to Canada; a common misconception amongst associates is that leaving Canada will kill their chances of making partner if they do decide to move back home eventually, but actually it helps.

CA: At what stage in their career do associates typically make the move to the US?

KK:  I get a lot of second- and third-year associates looking to move. It seems like folks in Canada settle down sooner than people in New York or California. I remember meeting associates in Toronto who were 26 years old, and they told me they were really excited about the prospect of moving to the US but they had just gotten married, had children, and purchased a house. I thought ‘Wow, most associates I speak with in New York and California aren’t thinking about that until their mid-30s.’

I’m getting more senior associate referrals now, but for the most part they want to work remotely from Toronto. The problem with that is the tax implications. So even though many associates are still working from home, firms are requiring them to officially relocate before their start date.

Although I recruit primarily from the Seven Sisters, there are ten or so Canadian firms that US BigLaw firms consider. This year I’ve placed people from firms that I had never worked with before.

CA: Where in the US is most popular with Canadian laterals?

KK: There’s a lot of energy work in Canada which transfers really well to Texas, but California and New York are the most popular destinations. It used to be the case that associates who wanted to move to California would initially spend a couple of years at a big name New York firm because Californian firms were more likely to consider associates with that type of experience. Nowadays, associates are bypassing the middle step and going straight to California because of the demand in the market. After a few successful placements of Canadian associates in California, the market seemed to really open up to them.

I primarily recruit associates from Toronto, but I’m recruiting more and more out of Vancouver as well. As the world opens up I will definitely meet with potential candidates there. It’s much easier to get a sense of which firm and culture an associate would like if I meet them in person.

CA: How has the pandemic affected recruitment?

KK: Firms initially thought that work would dry up so they implemented a hiring freeze – those that were advertising maybe 100 jobs across the nation pulled them all overnight. Then firms ended up even busier than they were pre-pandemic.

Interviews always used to be in person, so a candidate would have to take a few days off work and travel to the city they were interviewing in, now we do them virtually so we can schedule an interview at 8pm for the following morning. Everything is moving much quicker now.

“Some firms ask Canadians to go back a class year.”

CA: What is the main challenge when lateralling to the US?

KK: Some firms ask Canadians to go back a class year. For example, a 2019 JD year from Canada is sometimes treated as a 2020 class year in the US. Occasionally associates don’t want to take that step back, but actually it’s beneficial to do so because moving to a new country, having to take four to six weeks off to study for and take the bar exam, and the learning curve itself is a lot of pressure! I’ve had people push to maintain their class year, then end up wishing that they’d taken the step back after all. However, in this current competitive market, most US firms are honoring Canadian associates’ JD years, especially if the candidate isn’t making a change in practice area.

The view from associates who made the leap…

Associate A: I stepped back two class years. Some of my friends who went in-house were asked to step back more than two years. The firm wasn’t trying to take anything away from me, I just needed more experience. If I’d come in as a fourth year – my original class year – I’d have been leading M&A deals which I wasn’t ready for. We don’t specialize early enough in Canada for that. Of course it’s a bit annoying to be paid less than my real class year but I’m glad I have someone to oversee what I’m doing.

Associate B: I wasn’t asked to step back a class year which was good. Emerging company and venture capital work was a new area of law for me. A lot of the clients are startups and lots of the law is specific to California which I had to get used to, but the clients here are so much more interesting than in Canada.

CA: How does the working culture differ in the US?

Associate A: My billing target is 100 hours higher over here: in Toronto, people would comment on how much I was working if I did more than 200 hours a month, but people over here think that’s reasonable.

Associate B: My relationship with clients is different: smaller companies rely on lawyers to tell them what to do. When I was working with private equity houses in Canada, it was the other way round: they’d tell me what to do.

CA: How did the process of lateralling work?

Associate A: My recruiter submitted my resume to a handful of places, then I had a screening call with each firm to see if I was a good fit. About a fortnight later I did Zoom interviews from Toronto. I had two half-hour interviews spread over two days for each firm. You find out whether each firm wants to hire you within a couple of weeks. Before this hiring craze, the lead time for getting a job was two to three months because you had to fly to New York, but now, if you’ve been referred and have good credentials it’s easy to get in.

Associate B: Recruiters were calling us literally every day. Eventually, I heard I could get a $15,000 signing bonus which obviously appealed to me. I interviewed with ten firms in ten days – some gave me an offer on the spot!

CA: What advice do you have for lawyers hoping to relocate to the US?

Associate B: Do it! If you don’t want to make partner, then the work level is commensurate or even easier than in Toronto. Law is law at the end of the day, so the training is comparable but there are better jump-off opportunities here. You also get paid to be accredited in whichever US state you’re working in, but you can also keep your Canadian accreditation.

Associate A: It’s important to know what your long-term goal is – do you want to come here for a couple of years to make money and then go back to Canada? If so, then maybe you don’t mind which sort of firm you’re at. If career development is important to you then be discerning about the firm you join because there is obviously a difference in quality between different firms.

“Figure out how hard you’re willing to work because you will almost certainly need to work more here than in Canada.”

You also need to decide if you want to be at a global or regional firm. Then figure out how hard you’re willing to work because you will almost certainly need to work more here than in Canada.

Initially I thought I’d stay here for a couple of years then go home, but I realized there are a lot more opportunities and more interesting legal positions over here, so I’ve opened up my mind to staying in the US.

The final word from Kat Komarnicki…

If you don’t have a very strong interest in a particular practice area and want to just market yourself to US firms, then look at private M&A or general corporate work with a private M&A focus. Associates with that kind of experience will always be the most sought-after. If you’re interested in ECVC work and have the choice, you aren’t really benefitting by starting out in a general corporate pool and planning to specialize later – get your hands on ECVC work as soon as possible if you can!

“The Seven Sisters are actually the equivalent of AmLaw 30 or so firms where associates will find very similar training and exit opportunities.”

Since Canada has the Seven Sisters, laterals may only want to look at the top seven firms in the US, but you really cannot think that way: the Seven Sisters are actually the equivalent of AmLaw 30 or so firms where associates will find very similar training and exit opportunities. I advise my candidates to focus on the practice and personalities of the folks they’re meeting with. Many Canadians are very fixated on prestige – when in reality, all of the BigLaw firms we’re looking at are prestigious, so I typically encourage them to go to the firm they feel is the best fit.