The Real Lawyer: Wayne Outten (Part 2)

In this episode of The Real Lawyer Podcast. Wayne shares the incredible journey of building one of the leading labor and employment law firms in the country, starting with just two lawyers and a big vision. He dives into the challenges of starting a firm, the risks involved in class action cases, and the principles that guided his success—including hiring talented, passionate, and kind people. Wayne also offers heartfelt advice for lawyers dreaming of starting their own practice: focus on doing meaningful work, take risks wisely, and build a supportive, values-driven culture. This episode is packed with practical tips and inspiration for anyone in the legal field.

Transcript

Joyce Sophia Xu (00:03.214)
Welcome back to the Real Lawyer podcast. I am Joy Sophia Hsu, and you're listening to part two of my conversation with Wayne Alton, Chair and Founding Partner of Alton and Golden, a labor and employment law firm dedicated to advocating for employees.

Joyce Sophia Xu (00:27.49)
Wayne, in our last episode, you talked about starting Alton and Golden with this clear vision of creating the best and potentially the largest law firm representing employees. And from what I understand, you have fully realized your vision. Could you talk a bit about the landscape of law firms out there representing employees and also talk about how has Alton and Golden been able to

rose so rapidly and really distinguish yourselves? Well, there are now several other law firms that have more than 25 lawyers. Not many, I think maybe two or three others that I can think of. And there are literally thousands and thousands of lawyers around the country in smaller firms who are doing great work representing employees.

The vast majority of them, if not almost all of them, are members of NELA, either the national organization or one of the affiliates. So there are a lot of successful employee side lawyers and law firms out there, but it's not an easy way to make a living. If somebody wants to make a lot of money, there are a lot of other ways they can do so, practicing law, including probably representing employers.

Although there are some lawyers on the employee side who make very, very good livings, but I would say the vast majority of those are lawyers who have class action practices because there are abilities in a class action practice to leverage in a way that's much harder to do with individual matters. In fact, when I started the firm in 1998 with Ann Golden,

The firm was initially a firm that solely represented individuals. We did not have a class action lawyer at the time. And in 2000, I hired Adam Klein, who is now the managing partner of Altman and Golden, by the way. And he was interested in building a class action practice. And there were class action lawyers around, but not a lot. And so in the early days, and a class action practice, of course,

Joyce Sophia Xu (02:52.216)
The cases have fairly long lifespans and a good deal of risk. So for the first several years that Adam was with the firm starting a class action practice, he was building a pipeline of cases, but there wasn't a whole lot of money coming out the back end of that pipeline. So we were investing in building that practice and that succeeded. Adam is a terrific lawyer and he succeeded in...

launching the class action practice and brought in other lawyers. We started with a lot of discrimination cases. Class actions are expanded into wage and hour cases. Now, I would say roughly two-thirds of the lawyers and roughly two-thirds of the revenue of Alton and Golden comes from class actions, not from individual matters. And...

our firm in the class action side has a reputation of being among the very best in the country. And I can't take full credit for that because that was built by Adam and Justin Schwartz and others. My job was to essentially support them institutionally and structurally, helping create the infrastructure to sustain a practice like that.

eventually hiring paralegals and we now have probably more than 20 paralegals and creating a whole infrastructure to support class actions, which requires substantial amount of investment and a significant amount of risk too, because they're all contingencies. the kind of footnote to what I just described is we started out under capitalized. I mean, didn't have a lot of money when I started out in Golden.

I was receiving a payout over several years from my prior firm of a couple hundred thousand. And I was just working very hard on individual cases generating revenue to keep the doors open and pay the bills. And my wife and I actually took out a second mortgage on our house in Manhasset to meet the payroll sometimes. And we got a line of credit from Chase, which was very helpful. And gradually over the years, the line of credit increased so we could support more.

Joyce Sophia Xu (05:11.704)
class actions and big cases. Thank you, Chase. Shout out to Chase for extending that line of credit. Wayne, you just shared a lot of really helpful practical information that's especially helpful for lawyers who want to go out on their own and build their own law firm. So I wonder if you could talk more about some of those steps that you took to build out Alton and Golden.

And then also talk perhaps on the higher level about some of the most helpful guiding principles for you that really led to over the years this extraordinary success that you've had with Alton and Golden. Yeah. So starting your own law firm in any field of lawyering is not for the faint hearted. It's challenging.

Capitalization, having the money to pay people and pay your rent is especially challenging at the early days. I had the good fortune to hire, when I started the firm, my wife as the original office manager. And she's very smart and very talented, but she's not a business person. She happened to be a systems designer for an insurance company.

worked with me to open the first bank account and get the credit line going and install computer systems and all those things that needed to be done and to help build the firm. And she was an integral part of the growth of the firm for the first 20 years until she retired. So I had that extra advantage. But anyway, starting a law firm is a challenge, but it's also wonderful and exhilarating.

and scary at the same time. But in answer to your question, the key thing is to have a vision and to have the ambition and vision of what you want to accomplish. I had a particular vision of what I wanted to accomplish, as I already described, and that was like the load start, the guiding principle.

Joyce Sophia Xu (07:35.148)
that this is where I want to get. then it was figuring out step by step, zigging and zagging, making mistakes along the way, figuring out how to get from point A to point B to start with two lawyers and then build a firm that had the talent and resources to do what I envisioned. And so it was...

possible because I had a goal in mind and then I just had to figure out step by step, day by day, what to do each day to move toward that goal. And the best thing that I did, and it turns out this was not a talent I knew I had, was tracking and finding and hiring really talented people. And that I think is

Ultimately, the secret of the success of Alvin and Golden has been attracting because of our reputation and our culture and the kind of work that we do. Attracting and then finding and hiring and retaining, most importantly of all, is retaining really talented lawyers.

Throughout the time I was the managing partner, I had three guiding principles for hiring lawyers. One is to hire people who are stars or stars in the making or future stars, somebody who had the talent and drive to be one of the best employment lawyers in the country during their career. Number two, I want you to hire people who had a passion for helping people, who had a passion for wanting to do employment law only on the employee side.

Actually, occasionally, not often, we hired people from what we jokingly call the dark side, people who switch sides from representing employers to employees. They had to convince us that they had the passion for working for employees with that background. So passion for what you're doing is really important, especially because it's hard work. And the third thing was I want you to hire only nice people.

Joyce Sophia Xu (09:54.552)
Practicing law is hard enough without having to deal with people in your organization who are not nice people. And that has been an important guiding principle in selecting and retaining the people in the law firm. as I say, talent is the most important thing. And I guess also, figuring out

Well, accepting the fact, if you want to be an employee side lawyer, accepting the fact that your goal in life and in practice is not to get rich. Your goal in life is to do something that's rewarding and helpful and that you have a passion for. And if you get all that right and you work hard and you have some luck, then okay, then you may end up making a really good living.

Everything else will fall into place. Yeah, everything else will fall into place, but I never set out to get rich. And I'm still not rich, but I have had a very successful career and I've made a good middle class living and I have enjoyed every minute of it. So I've been very fortunate that way. Yeah, that's beautiful. said.

So I'm also curious as to the practical side of managing a law firm and deciding on what the infrastructure is going to look like, what the structure of the firm is going to look like. I wonder, I don't know how much you could share about the structure of Alden and Golden, whether it's similar to a traditional law firm structure with paralegals associates.

partnership and if the partnership is a single tier partnership or a multi-tier partnership and how do you decide the process of advancement for a lawyer joining the firm? Well, as the people who work in Alton and Golden, or at least while I was the managing partner, heard me say many times, I don't know what I'm doing, but I'm figuring it out as I go.

Joyce Sophia Xu (12:18.726)
step and so I had never created a law firm. I had never really run a law firm, although I was managing partner of my prior firm for a while. And so I had my wife to help in many ways doing what you're talking about is creating the infrastructure. But I knew I didn't want to necessarily follow any conventional model of the way things should be done.

I wanted to create a firm that was different than other law firms that had a culture of collegiality and so forth. So I established some guiding principles. Number one was that our goal as a firm was to do good while doing well and to do well while doing good. And that credo was repeated regularly at meetings in the firm.

This is what we're trying to do. We're not just trying to make a lot of money. We're trying to do good. We're a public interest law firm, and so we want to do both. But if you want to do a lot of good, you've got to do well enough to earn the revenue to hire people and to build a firm. So we paid a lot of attention to the business side.

of running our firm, even though it's a public interest law firm. And I have a business background and I know how to count and know how to read financial statements. so even though it was a public interest law firm and is, I was focused on making sure we were running the firm as a business in everything that we did. And so that required a lot of risk.

In some ways, we took reasonable risk, especially creating a class action practice. But even individual site practice, there's a lot of risk because a lot of those matters are contingency. So I had to accept the fact that we were going to take reasonable risk and we were going to do good while doing well and do well while doing good. Another credo was that everybody should be treated with dignity and respect.

Joyce Sophia Xu (14:43.98)
within the firm and outside the firm. So that meant that we not only treated each other nicely from top to bottom, no matter who you were in the firm, but also people outside the firm were entitled to be treated with dignity and respect, even opposing counsel, as well as courts and court personnel and so forth. So those were sort of founding principles with the mission that we had and doing good while doing well.

And another one was reinvesting. To create the vision that we had, if we made some money from a case, rather than putting it in our pockets, we reinvested it. We spent the money to hire more people and bring more cases. it was a deferred gratification, if you will, not putting the money in our pockets and buying stuff.

Other than, of course, we took salaries and we gave reasonable bonuses, but anything that we could, we would reinvest by hiring more associates, maybe hiring some partners, especially when we created additional offices outside of New York. Because we have offices in San Francisco and Washington, DC, we hired lateral partners on those occasions.

Step by step, we figured it out how to make all this fit. And again, we had the benefit of a letter of credit from Chase, which increased in size over the years. And gradually we got to the point of hiring, well, hiring our first associate. That was a big decision. And I think around 2000.

And then we hired several associates in succession and they were wonderful people. And then we decided, well, please let's try hiring paralegals. And we hired, we had different models for the paralegals. And basically what we settled on in their early years was what I call the young geniuses. People right out of college with liberal arts degrees and things like that who were really smart. They got top grades.

Joyce Sophia Xu (17:05.332)
and they didn't necessarily have an obvious career path with the degrees that they got. And those were the kind of people that we hired right out of as our initial paralegals. And they worked very, very well because these people were enthusiastic and wonderful. And a lot of them ended up deciding that they wanted to be lawyers and went to law school. And we hired some of them back as lawyers in our firm over the years. So...

getting to your question about the structure as we hired people and then we started having to get to the decision about whether to promote people to partner and we gradually developed standards for that. We are a two-tier law firm. We have equity partners and we have non-equity partners. And in fact, we have a track that we developed a long time ago that's written down. Everybody knows what it is.

you know, from associate to senior associate to counsel to non-equity partner and then maybe to equity partner. So it's a very gradual process and we have standards for all that and people know what they are. And we've created, of course, like any institution, we've created a lot of policies and practices over the years. And one final thing I'll note and then I'll be quiet for a minute.

is that in the early years, we were thinly staffed. A lot of the work was in managing and leading and administering the firm was being done by lawyers. We didn't have a lot of extra money to spend hiring professional management. And so we had like 20 committees. We had a committee for hiring lawyers. We had a committee for hiring paralegals. We had

a committee for marketing. had all these committees of lawyers and maybe with some staff support. Of course, that was not necessarily the highest best use of the time and talents of our lawyers, but it was of necessity the way we did it. One of the fringe benefits of that is that the lawyers in the firm, even the newest associate, was involved in the leadership and management and administration of the firm. They were part of the

Joyce Sophia Xu (19:29.558)
fabric and it resulted in them feeling like they really belong because they did and feeling like they were invested in the success of the firm because they were. And that worked very, very well in terms of attracting people and retaining people over the years. Eventually, we got to the size and complexity that we realized that we needed to change. And in

Let me see what year it was. I think it was 2013 when I was about 65. I told my partners that I wanted to create a succession plan for the next generation and that I was going to retire as managing partner when I turned 70, which I did. And so we hired a consulting firm. Actually, we hired two because the first one we didn't benefit from. And so we hired a consulting firm and they came in and

gave us lot of advice and they gave us an interim COO and they issued us a whole set of recommendations, the vast majority of which we adopted. And one of those was that we should have a COO to administer and run the firm, take a lot of the burden off the leadership, especially me at that point. And then, so we did and we've had a COO ever since then. And then the CEO,

over the years has built more of a back office infrastructure. And so now we have under the CFO, we have a CFO, a Chief Information Officer, a Head of Business Development and Marketing, Head of the Litigation Operations Department, all of which are very senior positions that report to the COO.

and a head of people, chief people officer, of course. And they have their own, we have a big organization chart. So we actually have now more non-lawyers working for the firm than we have lawyers. Oh, is that right? Yeah. Wow. Okay. Yeah. We've got about 60 lawyers, I think. And I know we've got more than 60 people involved in leadership, management, and administration. That's fascinating.

Joyce Sophia Xu (21:59.338)
Yeah, so we've built a machine that is perfectly equipped and trained to do the job of representing our clients. have now titles for people who work for us who I don't even understand myself exactly what they do, like chief data scientist.

But these are all people whose job is to help us do our job as lawyers better. Yeah, I mean, I think law firms, especially when you get to the size of Alton and Golden, it's really important to have other professionals to support the business and technology aspects of running the law firm.

So going back to what you talked about earlier, I think that's one of the brilliant things that you did early on was getting your lawyers involved in building and management of the firm. It sounds like you started from a point of having a very clear vision about the type of firm you wanted to build and the type of people you wanted to have at your firm. And then from there, you build the foundation and the fabric of Alton and Golden.

with this core team you had. And by the time you're at the point of needing outside consultants and business professionals to come in and help you grow in perhaps more of a systematic way, the foundation and that strong fabric are already in place. So that's what really allowed you to move through the succession process without being disruptive.

Paul Tobias, who I mentioned earlier, was the founder of Neela National, and he was one of my mentors. And he died three years ago at age 91, and he was a great person. And from him, I learned the idea of the founder's syndrome, and that's when the founder of an organization stays around too long to the detriment of the organization. And so because of that...

Joyce Sophia Xu (24:18.254)
I was one of the people who encouraged other board members of NEILA to retire from the board in 1996 to make room for the next generation. And that was why I retired as president of NEILA New York to make room for the next generation. And so obviously I had applied that lesson to Outland Golden. So at age 65, as much as I loved running Outland Golden, I knew that I needed to create a succession plan.

to get out of the way for the next generation. And so I started that process, which I mentioned, and hired a consulting firm, but we called it Outland and Golden 2.0, which was to reinvent the law firm that I and others had built by zigging and zagging and figuring it out as we went along. We were at a certain place and it was good. But if we were to design the law firm then, at that point,

would we have done it the same way and would we have ended up in the same place? So I decided that we should do what I call zero-based analysis. Take nothing for granted. Just because this is where we are and just because it's working successfully, we should take every single thing that we do, whether it's marketing or finance or benefit plans, we should examine every single one of them from the ground up.

and decide, can we do it better? And we did that. We spent several years doing that. And the purpose was to reinvent the law firm at that stage for the next generation, for the next 20 years. That's why I called it Out and Gold and 2.0. And that's what we did. And that's where we are. Pursuant to that succession plan, I stepped down as managing partner at age 70. And then I stepped down as an equity partner soon thereafter.

And I have the privilege to continue practicing law as much or as long as I want. And I do continue to practice law because I love it, although part-time and I'm phasing down. But the idea was for me to leave behind a firm that is even better than the one I built, that had the right leadership and right management and right infrastructure.

Joyce Sophia Xu (26:47.328)
and write culture and values to do even better for the next 20 years. And that's where we are. And the final thing I'll mention in response to that one issue that I touched on, but I want to emphasize is I've always considered culture to be the single most important attribute to the firm. These values like doing good while doing well and treating people with dignity and respect.

and striving for excellence and integrity at all times, which was another founding principle. And similar principles built into the fabric of the firm, into the culture of the firm. Number one, makes it a good place to work, I hope for everybody. It makes it good for retaining the talent, which as I said earlier, is the key to everything else. And it makes it easier to hire talent.

because of the reputation for the culture and the reputation that this is a really good place to work, a place where you can live your values and do good and still make a good living at the same time. So that culture permeates everything else in terms of creating the foundation for a successful business.

Joyce Sophia Xu (28:18.21)
Thank you so much for listening. And I would like to thank Wayne for so generously sharing so many great insights and wisdom. As you've just heard, Wayne has tapped into his own passion and conviction, as well as his business acumen in building Alton and Golden into a remarkable success. And to me, what's even more extraordinary is the amount of humility

Wayne has demonstrated in how he has led the firm and shepherded on this path of sustained growth and success. So tune in on Friday for part three of our conversation where Wayne shares more of his wisdom about life and he also shares some heartfelt observations about more personal moments in his life and in his career. Until then, be well and be happy.