Managing Complaints - Part I - Lawyers Defence Group

The need for complaint handling procedures

Introduction

The Solicitors Regulation Authority (SRA) has recently published guidance reminding solicitors of their obligations when it comes to informing clients of complaints procedures for barristers. Inevitably this acts as a reminder to all firms of the need for solicitors generally to provide complaint information in a manner which the client is able to comprehend and to make sure that their complaint procedures are transparent and usable.

However, to treat complaint handling as simply a requirement of the SRA Code of Conduct 2011 is to fail to understand the value that firms can derive from a well managed and effective complaints system.

In their 2013 Report, the Legal Ombudsman service revealed that they had received around 71,000 complaints in the year 2012-2013, resulting in a total of 7,630 cases being resolved.

By anyone’s standards that is a substantial number of dissatisfied people – especially given the fact that they will represent only those complaints which come from individuals, micro-businesses and small charities (thus excluding commercial claims from large organisations who are not covered by the scheme).

Research into complaint behaviour reveals that only a small number of dissatisfied clients actually complain. Many choose not to do so because they are sceptical about a firm’s willingness, or ability, to resolve their problem. More often than not, a client will simply not instruct the firm again or criticise the firm to others. In a market place where so much still depends on reputation and word of mouth, firms cannot afford for this to happen.

Research undertaken by Which? Magazine found that 40% of those who claimed to have had poor treatment at the hands of lawyers did not bother to complain whilst almost 75% of those who had complained were dissatisfied with the way their complaint was handled.

This is not a good record in any sector, and particularly worrying when one looks at the competition which law firms are likely to face in the future from alternative business structures and businesses such as the Co-op, Saga and the Halifax who are well used to dealing with customer service issues.

Keeping clients happy is not always easy, no matter how well you do the job and how little you charge. Fortunately, in the vast majority of cases, clients are satisfied with the services which they receive from their solicitor, barrister, legal executive or other lawyer. Every so often, however, things either do not go according to plan or the client feels let down. This may be because the lawyer has not done good a job, it may be because the client has not obtained the result he or she wanted or it may simply be that the client has not understood what was being done and what the likely outcome would be.

Whatever the reason for the dissatisfaction, the problem needs to be addressed in such a way that the client is happy with the outcome and the firm is not left in a position where time, resources and money have been unnecessarily expended.

All firms need to adopt and implement an effective, robust and transparent complaint handling process. To help you in dealing with this we have compiled a series of guides which provide an introduction to complaint handling and look specifically at:

The need for complaint handling procedures,
Implementing complaint handling procedures, and
The content of a complaint handling policy.

In this, the first of three articles dealing with the handling of complaints, we look at the need for complaint handling procedures and in particular at the benefits that can be derived from an effective complaint handling system and at the practical and regulatory reasons why firms should have an effective system.

Why have a complaints system?

There are a number of very good reasons why a firm should, indeed must, have a complaint handling system. Some of those reasons are regulatory whilst others, often the most convincing arguments, are practical, business-focused and competitive.

Clearly the best way is not to let complaints arise in the first place and firms should be doing everything possible to ensure that client care procedures are effective and implemented. However, it is almost inevitable that complaints will arise, so firms might as well make sure that they have in place system which enable those complaints to be handled properly and, wherever possible, operate to the benefit rather than the detriment, of the practice.

Handling complaints effectively can make a substantial difference to the effectiveness of a firm and end up increasing the costs of practice. Examples of costs that can arise include:

the cost to the firm in terms of handling the complaint – if the firm has a system which effectively nips complaints in the bud then it will waste less fee-earner and administrative time dealing with them;
the cost to the firm in terms of foregone or returned fees – if complaints are handled effectively at the outset there is less chance that fees will need to be foregone or refunded;
the cost to the firm in terms of the bad reputation that an unhappy complainant will create;
the cost to the firm in terms of lowering morale – staff who have to deal with angry or dissatisfied clients are likely to perform less effectively;
the cost to the firm in terms of a lost opportunity – a complaint is a way to find out how the firm could do things better in the future.

The practical reasons for having a complaint system

An effective complaint system is an essential part of the provision of a quality consumer service and a good means of measuring:

client satisfaction – clients who are dissatisfied with the service which they are receiving will complain. That complaint can be used to highlight inadequacies within the firm and give the firm an opportunity to raise levels of client satisfaction;
the adequacy of procedures – if a firm does not have adequate procedures in place then this will become apparent by observing complaints – for example if clients regularly complain that documents are lost or temporary absence cover is not adequate;
the competency of staff – complaints can alert a firm to issues such as whether staff are competent and able to handle matters in an adequate and timely fashion, know the law or are able effectively to explain matters to clients, and
the level of charging – if a firm’s costs are too high then this will very soon become apparent through complaints – especially since many clients are very aware of what the competition is charging.

Moreover, a complaint gives the firm the chance to put things right. Put another way, a complaint is free market research data.

However, just because the firm doesn’t get complaints doesn’t always mean it is perfect. It may simply be that:

clients chose not to complain,
the process for complaints is overly complex, or
clients see the firm as hostile to complaints and rather than waste time complaining they just go elsewhere or worse, tells others to go elsewhere.

That is why having an effective, transparent, client focused and usable complaints system is so important.

An appropriate complaint handling system can:

let the firm know if a particular fee-earner keeps making mistakes or, more worryingly, keeps making the same mistake;
by encouraging clients to raise issues with the firm, prevent minor complaints and grievances from becoming major problems;
highlight processes and procedures within the firm that are inadequate; and
help ensure that an adequate level of service is provided – if a client’s expectation exceeds what the firm is delivering, then the firm has two options – increase the level of service or manage an unreasonably high expectation level.

Of course there will always be those complaints instigated by the client’s desire to get something for free rather than from a genuine feeling that something has not been done correctly. However, a good complaints system will help the firm to weed out those spurious or ingenuous complaints and can even help by ensuring that the firm is not placed in a similar position in the future. Even a totally unjustified complaint can indicate that there has been a breakdown of communications somewhere along the line.

Regulatory reasons

There are a number of regulatory reasons why firms need to have a complaint handling system and these apply to solicitors, legal executives, barristers and many others.

Solicitors

The complaint handling requirements for solicitors are to be found in Chapter 1:You and Your Client in the SRA Code of Conduct 2011. Although not as neatly separated out as in previous incarnations of the Code of Conduct, nevertheless they remain as onerous and comprehensive in their effect.

Here, Outcome O(1.9) requires that:

“clients are informed in writing at the outset of their matter of their right to complain and how complaints can be made;”

Outcome O(1.10) requires that:

“clients are informed in writing, both at the time of engagement and at the conclusion of your complaints procedure, of their right to complain to the Legal Ombudsman, the time frame for doing so and full details of how to contact the Legal Ombudsman;”

Outcome O(1.11) requires that:

“clients’ complaints are dealt with promptly, fairly, openly and effectively;”

Outcome O(1.14) requires that:

“clients are informed of their right to challenge or complain about your bill and the circumstances in which they may be liable to pay interest on an unpaid bill;”

whilst Outcome O(1.15) goes so far as to place a duty upon the solicitor/firm to tell the client if it/he/she becomes aware that something has been done or omitted to be done that they might have missed but about which they could complain:

“you inform current clients if you discover any act or omission which could give rise to a claim by them against you”

The Outcomes are then backed up by a series of indicative behaviours dealing specifically with complaint handling, requiring at IB(1.22) that solicitors have:

“a written complaints procedure which:

is brought to clients’ attention at the outset of the matter;
is easy for clients to use and understand, allowing for complaints to be made by any reasonable means;
is responsive to the needs of individual clients, especially those who are vulnerable;
enables complaints to be dealt with promptly and fairly, with decisions based on a sufficient investigation of the circumstances;
provides for appropriate remedies; and
does not involve any charges to clients for handling their complaints;”

That the solicitor provides the client with a copy of the firm’s complaints procedure on request (IB(1.23)) and that in the event that a client makes a complaint, providing them with all necessary information concerning the handling of the complaint (IB(1.24)).

Chartered Legal Executives

The complaint handing requirements of the Institute of Legal Executives Professional Standards are somewhat less draconian than those which apply to solicitors, but they nevertheless are important and their provisions should be borne in mind at all times. Because at present the majority of Legal Executives work in other legal practices, all members of ILEX should make sure that they are fully aware of the complaint processes of the regulator which deals with the organisation in which they work since they will be subject to those provisions as well as those of their own regulatory body.

Principle 5 of the ILEX Professional Standards Code of Conduct provides that members must inform clients “fully and honestly about details of costs and complaints procedures.” Further information as to what is required by this is provided by the ILEX Professional Standards Guidance on Complaint Handling, which provides that ILEX members must take all practicable steps to make sure that:

complaints handling procedures provide effective safeguards for clients;
complaints are dealt with fully and promptly; and
appropriate redress is provided where necessary.

and even if the ILEX member does not have direct responsibility for complaints handling policy or procedures within their firm or workplace they are nevertheless expected to do what they can to comply with the guidance provided.

The guidance goes on to state that:

Clients should be given information about the firm’s complaints handling procedure when client care letters are sent or at the point where instructions are accepted. Clear information should be given to clients at this time about their right to complain to the Legal Ombudsman if any complaint regarding the service provided by the firm is not resolved to their satisfaction. The information provided must include the role of the Legal Ombudsman service, contact details and timescales for making a complaint to the Legal Ombudsman.
The process for clients to make a complaint to the firm must be clear and simple for all clients to use and must be free of charge. Complaints should be dealt with quickly and, as far as possible, within the time limit which applies to the making of a complaint to the Legal Ombudsman (currently 8 weeks). At the end of any complaints process clients must be informed of their right to complain to the Legal Ombudsman, how to make such complaint and the timescale for doing so.
Firms must provide information about the Legal Ombudsman service to their existing clients at the next appropriate time, whether or not a complaint has been made to the firm or is in prospect. This is a requirement of the Legal Services Board made under Section 112(2) of the Legal Services Act 2007.
If you have personal responsibility for client matters and your employer has not made arrangements to comply with this guidance (or guidance or rules issued by another legal services regulator such as the SRA or the CLC) you should inform your clients of the complaints handling procedures of the firm and make sure they receive the necessary information about the Legal Ombudsman service.
If a complaint is made to the Legal Ombudsman by one of your clients or your employers’ clients, you must cooperate with the Ombudsman and assist him to deal with the complaint.
For the purpose of this guidance a complaint is an oral or written expression of dissatisfaction which alleges that the complainant has suffered or may suffer financial loss, distress, inconvenience or other detriment.

The full Code of Conduct can be found on the ILEX Professional Standards web site at http://bit.ly/1gjbARf

Barristers

The primary duty upon barristers to deal with complaints is to be found in section C3 of the Bar Standards Board Handbook which provides that “Clients understand how to bring a complaint and complaints are dealt with promptly, fairly, openly and effectively”.

In addition, D1.1 deals with the complaints rules that apply to self-employed barristers, chambers and BSB authorised bodies. These provide as follows:

“You must notify clients in writing when you are instructed, or, if that is if not practicable, at the next appropriate opportunity:

of their right to make a complaint, including their right to complain to the Legal Ombudsman (if they have such a right), how, and to whom, they can complain, and of any time limits for making a complaint;
if you are doing referral work, that the lay client may complain directly to chambers without going through solicitors.

If you are doing public access, or licensed access work using an intermediary, the intermediary must similarly be informed.

If you are doing referral work, you do not need to give a professional client the information set out in Rules C 9 9.1 and C99.2, in a separate, specific letter.

It is enough to provide it in the ordinary terms of reference letter (or equivalent letter) which you send when you accept instructions in accordance with Rule C21.

If you do not send a letter of engagement to a lay client in which this information can be included, a specific letter must be sent to him giving him the information set out at Rules C 9 9.1 and C99.2.

Chambers’ websites and literature must display information about the chambers’ complaints procedure.

All complaints must be acknowledged promptly. When you acknowledge a complaint, you must give the complainant:

the name of the person who will deal with the complaint and a description of that person’s role in chambers;
a copy of the chambers ’ complaints procedure;
the date by which the complainant will next hear from chambers.

When chambers has dealt with the complaint, complainants must be told in writing of their right to complain to the Legal Ombudsman (where applicable), of the time limit for doing so, and how to contact him.

Documents and record keeping
All communications and documents relating to complaints must be kept confidential. They must be disclosed only so far as is necessary for:

the investigation and resolution of the complaint;
internal review in order to of improve chambers’ handling of complaints;
complying with requests from the Bar Standards Board in the exercise of its monitoring and/or auditing functions.

The disclosure to the Bar Standards Board of internal documents relating to the handling of the complaint (such as the minutes of any meeting held to discuss a particular complaint) for the further resolution or investigation of the complaint is not required.

A record must be kept of each complaint, of all steps taken in response to it, and of the outcome of the complaint. Copies of all correspondence, including electronic mail, and all other documents generated in response to the complaint must also be kept. The records and copies should be kept for 6 years from resolution of the complaint.

The person responsible for the administration of the procedure must report at least annually to the appropriate member/committee of chambers, on the number of complaints received, on the subject areas of the complaints and on the outcomes. The complaints should be reviewed for trends and possible training issues.”

The Bar Standards Board also provide what they describe as “First Tier Complaints Handling” which can be found on the BSB web site at http://bit.ly/1f04SKr

The SRA guidance on Barrister Complaint Information
On the 4 March 2014 the SRA issued guidance to all practitioners instructing barristers on behalf of clients. The intention of the guidance was to remind practitioners of their professional duty to act in their client’s best interests and to highlight the role practitioners play in ensuring that barristers are able to fulfil their obligations (as set out above) to notify the client of their right to complain. The SRA state that since the introduction of these requirements, it has become aware that some clients are not being informed of their right to make a complaint about barristers. Although instructions to barristers often include client contact details, this is not always the case. Without these details, barristers are unable to fulfil their signposting requirements without further co-operation from the instructing practitioner.

Accordingly, the SRA expects the instructing practitioner to assist barristers so that they (i.e. the barrister) can be in a position to advise the client in writing of their right to complain about the service provided by the barrister. Alternatively, the solicitor should be satisfied that the client has been appropriately signposted. This expectation protects the interest of the client and helps to ensure that barristers are in a position to comply with their own obligations.

Further details can be found on the SRA web site at http://bit.ly/PYoFVg

Licensed Conveyancers

As with solicitors, licensed conveyancers are now subject to outcomes-focused regulation.

Complaint handling is dealt with primarily in Overriding Principle 6 (Promote equality of access and service) of the Licensed Conveyancers Code of Conduct. This states that the licensed conveyancer:

…. must deliver the following Outcomes:

6.1 The service is accessible and responsive to the needs of individual Clients, including those who are vulnerable;

…………………..

6.3 You accept responsibility where the service you provide is not of the expected standard and provide appropriate redress for the Client where necessary;

6.4 Handling of complaints takes proper account of Clients’ individual needs, including those who are vulnerable;

6.5 Complaints are dealt with impartially and comprehensively.

These are then backed up by a number of principles and specific requirements, namely:

Principles – delivery of these Outcomes requires you to act in a principled way:

……………………

You make all reasonable efforts to ensure your service is accessible and responsive to Clients, including those with vulnerabilities.
Your complaints procedure is clear, well-publicised and free.
You treat complaints seriously and provide appropriate redress options.
You deal with complaints fairly and within 28 days.
You identify and address systemic Client Complaints issues.

Specific Requirements – you must also comply with the following specific requirements:

………………………………

From the outset you advise Clients in writing of their right to make a complaint, how to make it, to whom, and the timeframes involved.
You advise Clients in writing of their right to have their complaint escalated to the Legal Ombudsman and provide them with contact details and timeframes of that body.
You keep a record of complaints received and any action taken as a result.

In addition the Council for Licensed Conveyancers provides a Complaints Code & Guidance which can be found on their web site – http://bit.ly/1jbSxtZ.

Patent Attorneys and Trade Mark Attorneys

Rule 12 of the Intellectual Property Regulation Board Code of Conduct deals with complaints handling by patent attorneys and trade mark attorneys. It provides that:

Regulated persons in private practice must have an established procedure for dealing with complaints. Written details of the procedure must be available whenever a client requests them and a client should be informed in writing, when first engaging the registered person, that such a procedure for the resolution of a complaint exists.

Regulated persons in private practice must notify all clients of the right to complain to the Legal Ombudsman at the conclusion of the complaint process, the timeframe for doing so and full details of how to contact the Legal Ombudsman. Such notification must be in writing and be provided at the time of engagement or in the case of existing clients at the next appropriate opportunity. A similar notification must be provided to all such clients at the conclusion of any complaint process.

Regulated persons in private practice must keep records of all complaints received and the outcomes of their complaints procedures in respect of such complaints.

In this context a complaint means an oral or written expression of dissatisfaction which alleges that the complainant has suffered (or may suffer) financial loss, distress, inconvenience or other detriment.

Guidance

12.1 The Rules of the Legal Ombudsman provide a right of complaint to all individuals who engage the services of authorised persons such as Patent Attorneys and Trade Mark Attorneys. The Legal Ombudsman has also applied to have the jurisdiction to review complaints made by micro enterprises as defined in European Recommendation 2003/361/EC (broadly enterprises with fewer than 10 staff and a turnover or balance sheet value not exceeding €2 million); charities, clubs, associations and societies with annual incomes of less than £1 million, trusts with net asset value less than £1 million and personal representatives or residual beneficiaries of an estate where a person with a complaint died before referring it to the ombudsman scheme.

12.2 Sufficient information must be given to all clients to enable them to identify whether they do have a right to take their complaint to the Legal Ombudsman and to contact the Legal Ombudsman to clarify whether they can.

Note that complaints about professional misconduct will generally be handled by the Intellectual Property Regulation Board as opposed to the Legal Ombudsman.

Full details of the procedure relating to this will be found on the IPREG web site at http://bit.ly/1ji7pCL

In the next article we will look in more detail at the implementation of a complaint handling process.

Managing Complaints – Part I