20 October 2021 · Season 2, episode 19 · 50 min

Andrew Monkhouse

on building a top growing employment law firm in Canada

No.43
On YouTube ↗

Transcript

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Pulat Yunusov

Hello everyone, this is another episode of The Yunusov Question, a YouTube show and podcast about lawyers. I have a guest who is an employment lawyer today. His name is Andrew Monkhouse. He founded a firm called Monkhouse Law. And I'm very happy to have Andrew here today. Hello, Andrew.

Andrew Monkhouse

Hi, thanks for having me.

Pulat Yunusov

How are you today, Andrew?

Andrew Monkhouse

I'm doing well. It's an unseasonably warm October, and, you know, that's been nice, you know, entering, you know, year— it feels like infinity of the pandemic, but, you know, things are ever getting better. It's always interesting, especially from an employment law perspective.

Pulat Yunusov

Well, speaking of the pandemic, did pandemic— did the pandemic make you busier as an employment lawyer or less busy?

Andrew Monkhouse

It's an interesting question. I think that it did make us busier, but mostly because of the changes in the law that we had to stay on top of. For instance, to give an example, at the beginning of the pandemic, we created something, the CERB, or I call it CHIRB. Which is basically like employment insurance, but a lot easier to get for a lot of people who were terminated or laid off. But the government didn't have the resources to answer people's questions about it. So what happened is people started calling us, especially when something was ambiguous or they didn't know about it. Now, those people are going to be receiving $2,000 a week or so.

It's not a lot of of money that they would be getting. So $2,000 a month, that was about $500 a week. So the thing is that they, you know, it's not something you can really charge people for. So for instance, that was something where we were giving people a lot of advice and saying, you know, if there's a problem, if you're not brought back from your temporary layoff, give us a call then. But while it increased the amount of work, it didn't exactly generate exact one-to-one revenue. And a similar thing, for instance, is happening currently with vaccine mandates. So a lot of people are calling in and saying that they don't like the vaccine mandates that their employer has.

But really, our meaningful involvement on that would be where someone actually is terminated. And while we don't necessarily put it in that, in, in the following way, I mean, in effect, once someone's terminated, that's when our main involvement can get started. So these are things that make us busier, as well as having a sort of keep on top of the law, keep updated about the law. But I wouldn't say that necessarily the termination rate has increased dramatically. There was a point when the unemployment rate went up and that probably made things a bit busier for us. But at the same time, the courts closed down. I don't know if you remember from sort of approximately March to September, or they stopped the limitation period.

But in employment law, that effectively made things a lot slower for us. It hurt our revenue from a business side perspective. But also it made things harder to push ahead. A similar thing is happening in small claims court for our small claims court division, and that's ongoing, that unfortunately the courts just aren't moving things ahead. So I'd say it made things different, probably more work on a day-to-day basis, but only to sort of keep up with everything that's changing.

Pulat Yunusov

So then there is a strong relationship between how many people are fired and how much work and employment law firm has. Would that be a fair statement?

Andrew Monkhouse

Yeah, I'd say, I'd say there's certainly a relation, I believe but I wouldn't say such a necessarily a strong, super strong relationship. A high percentage of people unfortunately still sign off on severance packages they're given without trying to negotiate those, having a lawyer try to negotiate those packages for them, or maybe they try to negotiate themselves. Usually ends up poorly for them. And because the system is really meant that the employer expects you to go out and hire a lawyer and then negotiate the package— the vast majority of packages are negotiable because they know that people will negotiate. In Canada, a lot of people don't negotiate, but you know, people— this is one instance where people do.

But I guess my point is that because of those factors you know, it seems— it's not like if the job market decreases by 10,000 jobs in one month, suddenly the employment lawyers are busy. But if Canada adds 30,000 jobs, suddenly we're out of work or something. It's not really feast or famine. There's always terminations that occur. So it's more of a— the economy is more of a—

Pulat Yunusov

Sorry, say it again. Repeat the last sentence.

Andrew Monkhouse

Sorry, my computer dings. Reason. The it seems like it's a soft aspect to the change. There are other factors that are, that are more critical.

Pulat Yunusov

So you said something interesting. You said that employees don't negotiate often, and employers expect employees to negotiate and offer them smaller packages that they may be entitled to. Are you saying that termination and dismissal in Canada or in Ontario are adversarial by nature, where the employer expects a dispute and being just a more sophisticated party is prepared for the dispute, but most employees, being much less sophisticated, may not be aware of this adversarial nature of termination are not properly prepared and sacrifice their rights. Is, is, is this what you're trying to say?

Andrew Monkhouse

I think that's a good way to put it. I, I don't know if it's that per se adversarial. We actually find it often not adversarial, but it is something where an employer is attempting to use their greater knowledge of the situation of what an employee is owed, and they're trying to use that greater knowledge to get a better deal on termination. And the termination is going to be in effect, a deal. And so they aren't surprised when someone comes back and attempts to negotiate it because they actually expect it upfront. It's like if you go to a pre-owned car lot, the pre-owned car person is happy to take your money at the value they have written on the windshield of the car.

They also aren't going to be surprised and they aren't going to be offended if you offer a couple of hundred dollars or a couple thousand dollars less. That's sort of the type of situation that we're talking about for the vast majority of severance packages. The average person can usually do better. How much better and what's the value to that is to some extent sometimes the question. Sometimes people can do a lot better. Some people are terminated without any severance and they owe significant severance. A lot of people are terminated with severance and the severance package they're given is 30% low, 25% low, you know, something like that, or, you know, 50% cheap, but not not nothing.

Pulat Yunusov

So this used car lot situation in our employment and in our job market, is this normal and is this acceptable for a modern economy? I know that you have an economist a lawyer who is also an economist on your staff, right? And you yourself have a policy background, so you worked at HRSDC before law school, if I'm not mistaken. So I think that you can answer this question: do you think this used car lot bargaining situation in our employment market, is this acceptable for a modern economy where there is also an inherent imbalance of power, as we know, between between employers and employees, meaning that this bargaining situation is probably going to have a lot of unfair outcomes on one hand.

And then on the other hand, knowing that it will also generate a tier of intermediaries, such as employment lawyers, who will impose a cost on the operation of the market, of the employment market, by extracting a fee for their services, totally reasonable, but still a cost, right? So what do you think about this whole situation?

Andrew Monkhouse

Yeah, it's a great question. I do think that our system is a good system. And I say that primarily from an economic point of view. I'm not an economist myself. But generally, because there are other countries, and given understanding in looking at how other countries operate from from a labor and employment perspective, that a lot of other countries either side towards making it very difficult to terminate people. And in a world where it's very difficult to terminate people, you end up with problems whereby the economy can become stagnant. You end up in a situation, say, in France, where a very high percentage of people are on contracts because once you hire someone full-time, it's almost impossible, if not very, very difficult to terminate them.

And the same is a similar circumstance now in the UK, which initially had Canadian-style laws, and then they have diverged over time. And then the other extreme, of course, is the United States, where a 40-year-old employee can be terminated at will and they get nothing, which also isn't good because it doesn't provide for support for that employee, because then you have to provide other measures like stronger welfare systems. Because if instead you have a stronger— and stronger, say, employment insurance systems, because instead, if you have a severance system like Canada does, that can help the vast majority of employees transition between one job to another job without additional state support. So I think it's a very good system.

I think your question ended up in terms of clarity, and I think in that, and I think that it possibly does have some strong advantages, but this is maybe my psychology minor coming into play. Insofar as our system allows for a type of catharsis for employees who are terminated who need that catharsis. So an employee who's terminated is very upset they're terminated. They perhaps think some— they were terminated for the wrong reason. They perhaps think that they were terminated unfairly. In fact, they almost invariably think they were terminated unfairly. And from their perspective, they usually were terminated unfairly. But it allows them to say, I have rights. And to go back to their employer and say, well, no, I deserve more, and to negotiate with the advice of an expert, something better where they feel like they've had some victory and they feel like they've been able to get more and be able to, you know, create their own, their own aspect.

A very high percentage of cases settle. Some cases go to court, and employees in those circumstances very often also, you know, have a result that they can then say, you know, I was wrong. So it also allows the companies to have that level of catharsis. You have a negotiation with the employee, you figure out what the, you know, the employee is talked down perhaps, you know, they go, they first of all they want 40 years into the future and then their lawyer says, well, you can't get that, you're not gonna get 40 years, but here's what you get in Canada. And they talk that down rather than just getting rid of the employee saying, oh, nothing.

And then maybe you have the employee go to other ways. You see, you know, rage employees or employees who are upset at their company for the rest of their life, or, you know, in extreme examples you even see in the United States— and I'm not going to directly link the two— but there are instances of people going back into the workplace and being physically violent. But if you change that into a legal realm, that's a better way to do things. I think that in terms of the intermediary, generally the cost of that intermediary those intermediaries are borne by the employer. So it's a cost that the employer has to pay. They pay their own lawyer, obviously.

And they also generally have to pay half, if not more than half, of the legal fees of the plaintiff's side lawyer as well. Because since we have cost shifting in Ontario, if you were to go to court, you would get, in court, you would get some of your costs appraised and provided for. Therefore, if you settled, you should get part of that as well. So, you know, that's often borne fairly heavily on the employer, and to the extent that it's borne on the employee, it's a tax deduction for them where it reduces their taxable value. So the amount that an employee actually has to specifically pay at the end of the day is not particularly high.

Would I prefer a system where employment lawyers were provided by the state through legal aid and our fees were paid by that and we didn't have to charge anything to our clients? Personally, I think that would be a better system, but it would certainly be quite an expensive one, right? And legal aid itself is available, I'm given to understand. I'm not a criminal lawyer or a family lawyer, but in very few circumstances in any event. So certainly, it would not be a high level of priority for them. So I think that the system we have, I think, has worked out well, even if it is odd, and there are a lot of oddities to it.

But I think it does have advantages. Over systems which are harder to terminate people or systems where you just sort of get a fixed amount when you're terminated. So there's just a law that says you get 3 weeks per year of service if you're terminated, no matter what. I do think that it advantages both the employers and also employees who are knowledgeable about negotiating the severance package. It advantages both of those. So it's only really the people who don't care to do anything about about the situation. They're happy with the initial package, then they just sign off on it. Those people are the only ones who are sort of disadvantaged, but they're the ones who are choosing that disadvantage themselves by, by not having a negotiation.

That's a choice they make. So our system is very choice-based.

Pulat Yunusov

So your law firm, your employment law firm, is quite unique and it stands out, and we'll talk more about it But before I talk more about your law firm, I want to understand why there are so many employment lawyers in Ontario, or is my perception misplaced?

Andrew Monkhouse

Yeah, I mean, I don't think there are nearly so many employment lawyers as there are real estate lawyers. So I, I don't know, it could be a Toronto thing. It could be that Toronto has a fair amount of employment lawyers, specifically located in Toronto, and also that while we as employment lawyers don't advertise as much as, say, personal injury lawyers, I don't think, that we're probably, we might well be number 2 because we are reaching out to consumers. It's a consumer-focused, it's blog-focused, broad appeal, right? So someone who does corporate work isn't going to take out an ad on the subway, for instance, you know, do your M&A deal with me, et cetera.

Goodman's, Blake's, whatever, that's just not particularly targeted. They have other ways, you know, they're buying, they have other ways of advertising. Whereas for employment law, you sort of have a mass marketing appeals. So it could well be that I don't know, you tell me why, why are you seeing, who are you seeing in terms of all these lawyers?

Pulat Yunusov

Well, I think there are two major segments of consumer-facing law firms personal injury and employment real estate. I'm not, I'm talking about litigation. So real estate, I agree with you, this is probably the most numerous category of lawyers, but I think it's directly proportional to the number of real estate transactions that we have here, right? And then generally real estate transactions are considered to be a good thing, and disputes are not necessarily considered to be a good thing, but justice is considered to be a good thing. So I'll give you that. My, my concern, or maybe it's not a concern, maybe it's just a way to differentiate your firm from many other firms, is that I feel like a lot of firms come to the employment law field because they feel it's— there is an easy entry or low-cost entry into that field, right?

And in this regard, I think your law firm is really different and it really stands out. And I want the audience to see and to understand what you did differently to make your law firm stand out like that. So for example, It's, it's really interesting that your law firm was ranked by Globe and Mail as one of Canada's top growing companies in 2019 and 2020. I, I've never heard of law firms being ranked. I mean, it's a new ranking, of course, and when I saw that ranking, what struck me is that it was probably a ranking for startups, right? Or, or young companies in, in tech or maybe in retail or something like that.

And then of all law firms, your law firm made it there, and the numbers are quite impressive. So I'm really interested in, first of all, how you decided— what was the decision-making process in putting yourself out there. And I guess you applied to be in that ranking, I think, unless they harvested the data themselves, the Globe and Mail. So explain to me the process of getting on that ranking and what it meant for your firm.

Andrew Monkhouse

Sure. Yeah, I mean, you know, for that ranking, for instance, in this case, you know, you're You're absolutely right, there might well be other, there might have in the past or in the future be other employment law firms who don't make it on just because they don't, they're not thinking that way. Effectively in that case, my accountant said, I know other companies who have put their name forward for this, maybe you should put your name forward as well. Because my accountant could see the numbers and so figured that I would meet the criteria. So that's, that's assistance. And I think that does highlight one thing, which is, you know, it is important to get professional assistance.

You know, so many people I know who, you know, they start up their law firm and they, you know, of course you want to save every dollar, but you can sometimes be, you know, a pennywise but a pound foolish. I think if anything, at the beginning when I started my firm, I should have spent a little more rather than completely bootstrapping. Well, still bootstrapping, but bootstrap a little bit more because, you know, there are certain things, you know, you want to have a good system for putting in your dockets and a good accounting system. You know, Excel doesn't work and the Law Society is going to audit you and they're going to tell you that.

And then it's, you know, it is good to find an accountant and you want an accountant who deals with other law firms and deals with other lawyers, right? And, you know, for a lot of these vendors One great thing is to ask other lawyers. Other lawyers are often very happy to tell you who their favorite vendors are. You know, I like using this process server and I don't like these other process servers, right? And there are some, you know, that you want to look at expense and you want to look at how good people are because, you know, there are some really shady vendors for law firms that don't make, don't make makes sense.

So anyway, what has it meant for us? Yeah, I mean, I think it's nice to be ranked on these aspects. I do think that I probably think a little bit more like an entrepreneur as a law firm manager, managing partner, than some other people do. We're always trying to create new systems to create more efficiency for our clients. I think that there's inherent, some inherent problems that the that are faced in law. And I'm not the Elon Musk fixing them all, but I can at least identify them and try to fix them. The fact of the matter is 100 years ago, if you wanted to get a new piece of clothing, I'll use women's clothing for an example just for a second, the process is not much different for men, for at least formal clothing.

You'd normally go to a shop, you then have a number of fittings, they would personally customize the clothing to you, and then you'd have, say, a new dress for a woman or a new suit for for a man. Nowadays, sure, you still have that experience, but it was reserved for very few because the vast majority of people are happy to have an off-the-rack— the vast majority of people are happy to go to Moores or whoever, pull a suit off the rack, and that's good enough for them. The thing is, law is, in my opinion, still stuck in that first version. They're still stuck in the version where you want to customize these aspects. You want to have everything custom made.

If you think, again, I don't know, Adam Smith, who's an economist, had this idea of a pin factory. Instead of having custom pin makers making each pin, each person would do one movement, then you could make a lot more pins. I do like reading about economics a bit, but the fact of the matter is that if you can simplify some of the aspects that don't require professional judgment, you can save professional judgment, which is always going to exist in our field for different things. So I think that's helped me to some extent. You know, I think that as well, the top growing is a bit of a misnomer. I mean, we aren't expanding beyond all measure.

We care a lot about our culture at Monkhouse Law. We try very hard to make sure that we have a culture that works for everybody and that people like working with other people. People wouldn't love and this has been a bit annoying in the pandemic, not being able to spend time with their colleagues who they also see as friends. So, you know, while we have expanded at a steady pace, it's also important to us and important to me to expand at a, at a reasonable pace over time, because I think that's important, because you see otherwise firms can really crash and burn. They get too big too fast, and then they run into real issues afterwards.

So it's all growing within your means.

Pulat Yunusov

Well, I think for most law firms, getting too big too fast is not an issue. They are just trying to make ends meet. So in this regard, your numbers are actually quite staggering. So I know that you founded your firm in 2013, if I'm not mistaken. So, so according to the ranking, your 3-year revenue growth in 2019 was 178%. And you had 18 employees. The annual revenue was between $2 and $5 million. So the, the next year's ranking, you according to the next year's ranking, you had 25 employees, and the 3-year revenue growth slowed a bit to 92%. So are you slowing down from these numbers now when you say that you prefer a more, a steadier rate of growth or are these numbers your idea of a steady sort of stable rate of growth?

Andrew Monkhouse

Yeah, I mean, I think naturally the numbers will decrease because it is difficult to get exponential year-over-year growth for any law firm. Law is just extremely heavily regulated. That has advantages and disadvantages. One advantage is that it has a very strong, you know, Warren Buffett would sort of say a moat You know, some high school student can't go and start up their own law firm and start offering services better, even if theoretically the market would think that that person's offering better services. Law has been fenced off by regulation, but also we all need to comply with regulation, and there are very, you know, difficult aspects. You can't run an Uber of law. I think the Law Society would get frustrated with you.

Look at, like, for instance, Diamond and Diamond, who attempted a different model of law and ran into quite some problems with the Law Society. And so certainly there are those issues. I did mention, I think, the pandemic affected us because we're primarily litigators and having effectively the court shut for 4 to 6 months and then having limitation period run out, that obviously affected us in 2020. But I think that we're going to see slowing growth, but also because Monkhouse Law isn't going to take over the entire business of law. I personally have no interest in that. At some point, there's a law of diminishing returns vis-à-vis employment law. At some point, there's only so much more of the employment law piece that you can grab.

Part of it's about educating the public to get more people to know to contact a lawyer to begin with. But, you know, I think that that's a, you know, it's a steady state. I mean, at some point we might not be, you know, I expect at some point in my legal career we won't have year-over-year growth at all because we will have reached the adequate size to adequately help people in Toronto and across the country, you know, with their employment law issues in a way that makes sense to us without becoming too large to become bureaucratic and and to become what we started to sort of fight against.

Pulat Yunusov

So I, I'm really curious about law firms that grow, law firms that expand, law firms that have exponential growth and who have broad trial experience, because trials take a lot of time, take a lot of resources. They They take a lot of expertise, and sometimes they may be incompatible with exponential growth, where, where maybe you would just prefer to settle. That would probably help growth better than going to trial. But yet I think your firm does have extensive trial experience, and I want to ask you to tell us about your firm's trial experience and how you set up the trial division, if I may say say so of your law firm?

Andrew Monkhouse

Sure. So to some extent, we operate as a flat organization with a number of teams. So each lawyer and a paralegal usually work together in a team handling the files so they can make sure that they're adequately taking on and handling files that come in. And then I, at this point now, I oversee those teams and get brought in when and if needed, you know, for the teams. Now, you know, it's not always required. If a senior lawyer is, for instance, going to a hearing or a trial, a summary judgment or a trial, and they feel comfortable doing it, I'll perhaps give some advice, read over the factum, give them some suggestions, but they'll do that argument themselves.

But it allows the teams to bring me in if needed And I, you know, when I was studying to be a lawyer, you know, wasn't afraid of going to trial, even if, you know, I agree with you from a financial perspective. Usually as a lawyer, trials usually are not worth it. You tend to lose money on it because you're not going to get all the money back, usually either from your client or from the other side. And it's just very, very— it can be very, very expensive. But so that's, you know, that setup has allowed us to be able to outsource that work. So even if one team is going to trial, the other teams can work on other files and have files sort of coming in and being able to settle those files.

A very high percentage of files settle. I'm not saying that, but, you know, there are other law firms and we see them in employment law and they worry me where they effectively have no trial experience. And then I'm not sure they're really asking the questions that need to be asked if they do go to trial. And even if they do go to trial, then their ratio is often very bad. They lose 2, 3 cases. And then they come talk to us for the appeal. But by the time you're getting to the appeal, there's only so much you can do. And that concerns me to some extent. And there are some lawyers and law firms that operate sort of on the 80/20 rule.

So you can get 80% of the results with 20% of the work, and then the remaining 20% of the result takes 80% of the work. And that can obviously cause problems and also discrepancies between what the clients want and what the clients need and what you want. So I mean, we pride ourselves on being willing to go to litigation, on being willing to, stick to our guns if need be. But, you know, you really need a very you really need a very steadfast defendant who just sort of is out for blood and isn't also looking at economics to go to trial very often.

Pulat Yunusov

I think that it's fair to say that your firm has two very general divisions. The traditional employment law division and the class actions. Would you agree with that?

Andrew Monkhouse

Yes, it is. And so we started out class actions initially and, you know, we had employment lawyers working on it. The first class action we started, I think, was back in 2015, Sonny against Deloitte, now Philip against Deloitte, relating to mismanagement misclassification at Deloitte, the accounting firm, specifically relating to people who used to be lawyers who worked in document review. So that was the first misclassification case claiming that employees were being misclassified as independent contractors in Ontario. And so for quite some time we had that case, but we found that it had some difficulty in having lawyers who were working on class actions doing sort of a deep dive into these class action measures also working on regular employment files.

So we've now sort of split that aspect, which we had an opportunity to do when my wife joined the firm as a partner as well, and she takes a real role on the class action side of things. And we've now expanded to have dedicated class action lawyers because it is very difficult if you have 100 emails or 200 emails per day and then to be trying to write a detailed factum, it causes concern in terms of trying to do both. The lawyers who did it initially, Samantha Lucifora, for instance, and Steve Lemeijer, who are still with me and great lawyers, I mean, they did very well, but it's difficult, especially when I think we now have something like 20 class actions.

It would just, it would be very difficult to spread that out among the other lawyers. So we expanded the class actions. A natural fit for us because it's still— we still practice in class actions at present relating to employee rights. So it's things we are running into and seeing and being contacted about on a day-to-day basis by employees. And it does fulfill our mandate in terms of bringing access to justice and even to even more people through class actions where people are, say, misclassified as workers or they aren't being paid vacation pay adequately. This often happens with commissioned employees. They aren't paid vacation pay sufficiently on their commission. They just say you get 30% of your sales inclusive of commission, and the law says you can't do that.

So it's a fairly niche area, but it does result in effectively those people having zero paid vacation whatsoever. To other issues like negative vacation banks and overtime claims and claims like that.

Pulat Yunusov

Is the busy volume-based employment law practice a distraction? When you do class actions? Is this why you separated class action lawyers at your firm into a different subgroup? Well, I, I'm trying to understand what you said about lawyers being inundated with emails, which sounds to me like a symptom of a traditional employment law busy volume-based practice while they were also trying to write complex factums on class actions.

Andrew Monkhouse

I think that's correct. And on top of that as well, class actions is— it is just the law is very different. You know, for employment law, you're often fighting about whether or not someone should get their bonus or what the length of someone's severance period should be. And in class actions, you're often fighting about whether or not that matter is appropriate for certification, so whether or not it can be decided on a class-wide basis. And there's often a lot of technicalities insofar as defendants often tend to defend on minor technicalities as opposed to what I would consider the merits. So whether or not they were underpaying their employees, they often don't necessarily even talk about that.

They just talk about whether or not it can be decided on a class-wide basis or whether or not it's appropriate for summary judgment or a number of other issues. So the focus is different even though the sort of subject matter is the same. So yes, we've found that it's quite difficult to handle one or especially more than one class action and also a regular file load of files. And so that's why we tend to keep the divisions separate.

Pulat Yunusov

I want to talk to your wife, Alexandra, separately, actually. I think it's much better to get it from from the source. But I just want to very briefly ask about— I'll ask about her. So she comes from a blue-chip background. She practiced law at Davies where, by the way another guest of the show is a partner, Chantelle Cseh. She's a partner in the litigation department and a good friend, the former Osgoode classmate. So, but your wife,

Andrew Monkhouse

Alex, knew each other when they were there. Yes, they knew each other, I believe. So

Pulat Yunusov

yeah, yeah, yeah, yeah, yeah. So Alexandra is a really interesting person. Did she bring the class action idea to your firm, or— I think, I think you started your first class action before she joined, right? But she's now leading the class action division at your firm. What's her What's her input there?

Andrew Monkhouse

Well, she leads the division. She supervises the lawyers that we have there. So there are 3 lawyers and then she's leading them. I'm brought in only for hearings and things like that. So on a day-to-day basis, she's leading that. It was something that we discussed in terms of a possibility. I mean, she liked the type of work we were doing, that we were able to get into court, that we were able to help people. And we had had a proof of concept already in terms of our Deloitte class action to show that it had at least some legs. We also knew that it seemed like an area that was open for expansion in Canada.

In the United States, a much higher, very high percentage, or much higher than in Canada, I think I think, you know, 20 to 30% of class actions are employment-related. In Canada, before we started issuing class actions, and then a number of sort of class actions based on a derivative of class action that we've started by other firms, and there are a number of firms now that are starting more class actions in employment, but the rate was less than 1%. And the United States has much less employment protections. We discussed this earlier. I mean, in many states, there is no mandatory vacation pay at all. Whereas in Canada, that's one of the main things that people are fighting about in these instances.

So the fact that there is, it seemed like an area that is ripe for expansion insofar as there's been consistent academic studies that the vast majority of employment situations are not complying with the rules, partially because the rules are somewhat complicated, educated, but they aren't getting adequate advice to comply with the rules. And so then there's a vulnerability there on a systemic basis, because if you have a policy that denies everybody vacation pay, one would imagine that's quite easy to deal with on a class-wide basis. So we've dealt with it together and she decided to join the firm where, I mean, I'll let her speak to it, but I think she's very much enjoying it and, you know, really gets to represent and be involved in court process and see real results for employees and for our clients.

Pulat Yunusov

What is it like being a law partner with your spouse? Do you guys talk about work when you watch Netflix? How does that work?

Andrew Monkhouse

Yeah, I mean, yeah, we don't— I know some people, I know a fair amount of lawyers who are married to other lawyers, as I'm sure you do. You know, it's an occupational hazard. But, you know, I would say for us, we don't have a— some of them have, for instance, like hard lines, like we come home, we don't talk about it. But because we're also working together, we, you know, we do tend to blur the lines and just talk about work, talk about the kids, talk about work, you know, that sort of thing. We've tried to make a bit of a rule, like not talking about work after 7 o'clock at night, and that, you know, works at least most of the time.

So, you know, I think it's really useful because we can sort of skip past the background, and so because we know what the other person knows quite a bit, we sort of skip past some of the preliminary issues and explore ideas quite quickly and then make decisions on that, whether or not to move forward, because starting any class action is a substantial and The average class action probably takes 10 or more years. So, you know, they're fairly— they can take quite some time. At least some of them take quite some time. And so it's a substantial financial input. This is another thing. I think it really wouldn't be possible to start up just a class action firm, or at the very least you'd have a lot of difficulty because your income would be so variable.

And that's why, you know, you see a lot of firms have sort of a bread and butter issue where you're getting money on a month-to-month basis. And then you have a large settlement or a large judgment coming in on the class action side once in a while too, to sort of even it out. It's very— you have to put in a lot of upfront investment.

Pulat Yunusov

I'm looking at your website and I see under our team, you have several teams and there is a team of employment law lawyers, which includes you, Samantha, and others, and that would be 10 lawyers according to the website. And then there is a team of class action lawyers, which includes Alexandra and some other lawyers, so that's a team of 5. And then there is a separate team of paralegals, and you have more paralegals at your firm than lawyers, correct?

Andrew Monkhouse

I would think it's— I would think I think it was about the same, but, you know, when you add up the, you know—

Pulat Yunusov

So you have a separate paralegal team, 1, 2, 3, 4, 5, 6, 7, 8 and then you have a separate small claims division, which I understand consists of paralegals, which is 3 more paralegals. So you at least, you know, according to the data that I have, you have about 11 paralegals at your firms— at your firm. So what is the role of paralegals at Monkhouse Law.

Andrew Monkhouse

Yeah, so that makes sense to me. I was like, not more, I would imagine. But yeah, usually, like, approximately the same amount. Like, maybe there's a few more lawyers. Class action is a bit more lawyer-heavy. The divisions online, just to pull the man behind the machine, Wizard of Oz, the man behind the curtain. And, you know, we just— if we listed all of our people, it would just— wouldn't be on one page. And so we have to divide them up in some way in order to have it display on your web browser. So, you know, this is the mystery here. But leaving that aside, these are logical divisions to some extent, but, you know, it is also partially that.

So it's generally two different roles. The primary historical role for paralegals at our firm has been in assisting the lawyers in a team-based environment, as I mentioned. So they do intake calls and assist in bringing in clients, you know, letting clients know, potential clients know, maybe it's not sort of case that we can help them with, or if it is the sort of case, connecting them with a lawyer to assist them further. They also deal with moving files ahead. They, you know, the lawyers and the paralegals often have meetings, you know, if not daily, every couple of days about, you know, here are the files that we have. Each file is assigned both a lawyer and a paralegal.

It's the same file. So a lawyer and a paralegal team might have 40 files, let's say, and they act as sort of case managers for those files and help to move them ahead. So that way, if a lawyer's in a mediation but a client really needs to talk to them, they can call the paralegal who's potentially more free on that matter. And it lets the lawyers focus on more high-value high-level work, as sort of discussed in terms of trying to create sort of subject matter experts. We found one problem in law for some of the firms that existed prior to Monkhouse Law is that lawyers are not wonderful social workers to some extent, insofar as there's a very much— I forget the old detective TV show, like, just the facts, ma'am, or Just the facts, sir.

Yeah, yeah, don't tell me your life story. I don't really care about how it affected you. Just tell me— I have questions for you because I'll tell you whether or not you have a case. And that's useful, but these people have went through a traumatic experience and—

Pulat Yunusov

Sorry, that show is called Dragnet.

Andrew Monkhouse

Dragnet, there you go. I was missing it for a second. Dragnet. And listen, lawyers, that's their job. That's what they do. Supposed to do, and honestly, I do it myself. But, you know, there, there's all sorts of psychological studies that say that losing one's job is, is like as traumatic on people's self-esteem as like having a divorce, which is obviously extremely traumatic, and, and things that are, that are like this. And so people often want to talk to someone, and, and they don't really want, you know, if the person's okay, let's get to it. So providing the paralegal gives them someone who they can have more opportunity to talk to now, of course, they can't call up and just spend 6 hours a day.

I mean, at some point it becomes too much and it becomes expensive for them. But it's someone who can talk to them at a lower hourly rate and who can provide more of a human touch. And we think that that's very important. And then also it makes sure that the lawyers have someone who can support them on all of their files in a way that's above and beyond, you know, often what an assistant can do. It's expensive for our firm, but it's a system that we found works fairly well. So that's the traditional role. Those are sort of listed under the paralegals. And then there's a small claims division, which are also paralegals. But, you know, if we put small claims paralegals or something, it would be too long for the graphics of the website.

And so we created a small claims division to enhance access to justice. It seemed to me that we were eventually slowly becoming a law firm that was going to help people in the top 10%, if not top 5% of income earners in Canada. And, you know, over time that would have happened. That wasn't where we were at. But at the time, we weren't really representing people well, say, in the bottom 50% of income earners and people who would be going to small claims. And so what we did, because I felt like that's something where we wanted to be assisting people in that, possibly the better business decision would have been to not help those people and restrict our practice further and further.

But the decision that I made was to start a small claims court division, which would be able to assist people who are, you know, making at every income level, so that we are able to assist people and be able to deal with that. And so that's led by Jane O'Palaugh and, and Jia Manubag from you know, at a firm, and they have a law clerk, Freeshta, at the moment, who's helping them. And, you know, so that allows them to be able to help people, you know, who have smaller claims. Now the small claims court limit's up to $35,000, which didn't really change our practice much, but it really assists with that because, you know, someone who's making minimum wage might have quite a good claim, but the issue is the economics of it, is that it just doesn't make sense to to hire a lawyer to assist those people.

And so there's a frustration there.

Pulat Yunusov

And the paralegals at your firm that run small claims files, do they own them, or do you still bring in a lawyer to sign off or to supervise in any way?

Andrew Monkhouse

No, they, they run them. I mean, they're paralegals, so small— like, they're fully qualified to run files in small claims. Small claims, you know, they could go and start their own law, their own paralegal firm tomorrow and represent people in small claims. That being said, historically, we haven't seen people be successful that way because when someone gets terminated, they don't say go and hire a licensee licensed by the Law Society of Ontario. Their aunt, their uncle, their mother, their brother says go hire a lawyer. There's an advertising disadvantage that they have. And that's why we found it to be positive to, instead of trying to refer out— and we have referred out in the past, and so we still do sometimes, obviously, when we have conflicts— but to be able to move that in-house and be able to have people assist.

It also frees up the time for our lawyers because we don't have the lawyers dealing with small claims court matters. We have the lawyers dealing with virtually no small claims court matters unless someone wants to pay pay more to have a lawyer. But usually we haven't found that most people do once that's sort of the option. I mean, why pay twice the hourly rate for a lawyer when you can deal with a paralegal who's very knowledgeable of small claims court or human rights tribunal system?

Pulat Yunusov

What is one thing in Ontario employment legislation that you would want to change today?

Andrew Monkhouse

Yeah, it's a great question. Well, I think that, you know, there were a number of changes that were suggested in that there was a changing workplace review done under the previous Liberal government, and that resulted in Bill 148, which made a number of changes which we rolled back. So I mean, I would say one thing would be the inclusion of the specific reference to include dependent contractors in getting employment standards protections. So right now it's actually unclear whether or not people who are considered dependent contractors are protected under the Employment Standards Act. So I think that employees who are dependent contractors deserve some level of protection, and I think that, that, that's been missed.

One problem in our system, although I spoke very highly of it earlier, is that there is a perverse incentive for companies to classify, to classify employees as independent contractors when they should be classified as employees. And it disadvantages a number of people within society. It disadvantages the employees who aren't paying into CPP, don't get EI, don't get vacation pay. But it also disadvantages the competitors of that company who gain an unfair advantage advantage by misclassifying their workers. And they're trying, you know, a company who pays people as employees is therefore potentially at a disadvantage because they're having to jump through more red tape, they're having to pay more. And so they then lose out over time to the companies that are not, as we see it, playing by the rules.

So I think that the misclassification is one of the biggest issues that we see. And, you know, a fix to that would be would be great, but is also quite contentious. So I think that's my answer. I think in the Changing Workplace Review, they suggested including in the definition of employee, my understanding is they suggested changing it to include dependent contractors. And I think then you'd have to decide, do you wanna give them just dependent contractors or contractors who work for someone quite a bit? Do you wanna give them the same rights as employees? Is there, should there be a contractor bill of rights? Those are the sort of questions that I think society needs to be sort of dealing with.

But I'd say, you know, if I could change one thing, it would probably be that.

Pulat Yunusov

Well, Andrew, it's been a pleasure chatting with you. I want to wish all the best to you and your firm, and thank you so much for this conversation.

Andrew Monkhouse

Wonderful. Thanks for having me.