Waivers, PPI Claims and the Information Gap

Waivers, PPI Claims and the Information Gap

In this month’s article, we are going to take a brief look at three regulatory-related topics which, though important, appear to be linked only by the fact that they have been the subject of recent statements by the Solicitors Regulation Authority (SRA).  However, we would suggest, all three demonstrate that although the SRA is also currently promoting the fact that it is moving towards a simpler and easier set of Principles, Codes and rules for solicitors and law firms, nevertheless it is the detail (or in some cases the lack of it) in many of the other provisions that is going to make compliance with regulations in the future a less certain experience for many firms.


We start our brief roundup with a look at the changes announced to the waivers regime.

Waivers are applications by individuals or law firms, to the SRA, for those individuals or firms to be granted what amounts to an exemption from compliance with a particular rule. They were never a particularly well publicised option for solicitors and until recently there were no overarching definitions of waivers and how they might be used.

Even going back to the usually comprehensive 8th Edition of the “Guide to the Professional Conduct of Solicitors”, waivers were very much something that was referred to only in the context of individual rules – and even then only in fairly vague terms that gave little clue as to their usefulness.  Thus, for example, in the Solicitors Incorporated Practice Rules 1988 the availability of a waiver was something that was enigmatically left to the Council of the Law Society to grant or revoke without any guidance being given as to what might or might not be waived.

That lack of information is now, thankfully, a thing of the past and hidden away in the “Resources” section of the SRA website (https://www.sra.org.uk/solicitors/waivers.page) is a reasonably comprehensive description of how and when waivers may be used. This covers the decision making criteria for granting waivers, which rules may be waived, decision making guidance – including some examples, and the publishing of waiver decisions.  We will return to this shortly.

What makes waivers newsworthy at present is the “new approach” that the SRA is taking towards the granting and publishing of waivers.  This approach, it is claimed, is to encourage innovation whilst at the same time making “information on successful applications more readily available”.  Thus, the SRA will now be diverting more of their attention to waivers designed to deliver benefits to the public and will be applying simpler, more easy to understand criteria to the consideration of those waiver applications.  This, it is felt will, promote greater transparency – whatever that actually means.

Details of the approach will be found in the SRA report “Encouraging innovation: transparency about our waiver decisions” which was published earlier this month (June 2018) – https://www.sra.org.uk/documents/SRA/research/waivers-innovation.pdf.

So what does this actually mean?  When can a waiver be applied for and what are the criteria that will be applied?

Most commonly at present, waivers are being applied for by those who want to start and operate new business models – for example those wanting to establish multi-disciplinary partnerships or to develop new ways in which in-house teams can offer legal services more widely than only to their employer organisation.  This is seen by the SRA as being one of the most useful ways in which the waiver process can be applied since it is, in effect, widening the scope of the public’s access to legal services.  The SRA have called this ‘Innovation Space’ waivers and is designed to stimulate innovation and growth in access to high quality professional services.

In their report, the SRA state that they apply a threshold test of:

  • are there benefits in the innovation to the users of legal services, and
  • have consumer safeguards – including access to redress – been incorporated within the application.

Under the new criteria for the granting of a waiver, the SRA has replaced its generic “exceptional circumstances” test with a single set of criteria based around regulatory objectives as set out in Section 1 of the Legal Services Act 2007.  In other words, the waiver must have the effect of:

  • protecting and promoting the public interest,
  • supporting the constitutional principle of the rule of law,
  • improving access to justice,
  • protecting and promoting the interests of consumers,
  • promoting competition in the provision of legal services,
  • encouraging an independent, strong, diverse and effective legal profession,
  • increasing public understanding of the citizen’s legal rights and duties, and
  • promoting and maintaining adherence to the professional principles.

Not all rules can be waived.  In particular, those that impose obligations required by statute, or other legislation such as EU Directives or Regulations cannot be waived.  Among those that can, however, are the SRA Code of Conduct, parts of the SRA Accounts Rules and particular provisions in other rules including the Practice Framework Rules, Authorisation Rules, Indemnity Rules and Overseas Rules.  A full list is to be found on the SRA website.

There is now a form for applying for a waiver which can be found on the SRA website at https://www.sra.org.uk/solicitors/waivers/apply-waiver.page .  This includes details of how to apply and the evidence that will be required for doing so. The form is fairly self-explanatory although it does require that you are able to provide a reasonable amount of data about the application including details of the exact rule or regulation which you are seeking to have waived, the purpose of the application and the outcome you wish to achieve and why you consider that granting the application will be compatible with the regulatory objectives in section 1 of the Legal Services Act 2007.  You are also able to provide reasons as to why you would prefer the SRA to withhold publication of details of your waiver or to publish the waiver without disclosing the identity of your firm or avoiding certain key details.

Having granted a waiver, the SRA will normally publish a summary of the waiver decision on their website. This will include:

  • a summary of the application
  • the waiver granted and the reasons for granting it (or not)
  • any conditions we may have decided to attach.

If you do not want those details to be published then you will need to put forward a case as to why it should not be published or why certain details (including the name of your firm) should not be disclosed.


The Financial Guidance and Claims Act 2018 comes into force on 10 July and one of the provisions contained within it deals with the issue of the fee cap – which will limit the fees that can be charged in PPI claims to 20% of the fees recovered and ban charges being made at all if no compensation is recovered.

Research carried out by the SRA earlier this year revealed that four out of five of those firms active in this area were charging fees in excess of 25% – with some charging as much as 50% – clearly outside the new capped limits.

To assist those firms active in this area, the SRA have published on their website a series of Questions and Answers relating to the fee cap and have updated the whole of the warning notice first published in August 2017.  These can be found at www.sra.org.uk/sra/news/press/ppi-fee-cap.page

Publishing Prices

Finally in this regulatory roundup we are going to look briefly at the SRA’s plans to require law firms to publish information on the prices they charge for certain public-facing services and also to display a new “badge” showing the protections their regulated status gives customers.

The decision to require firms to publish prices follows research carried out by Economic Insight into price transparency which was published in January of this year and which suggested that 85 percent of people wanted information on price, protections and quality of service before choosing a legal services provider.

Following this report, the SRA are going to require that, as of December 2018, all regulated law firms publish information on the prices they charge, and what these cover, across a number of common services, including:

  • For members of the public: conveyancing, probate, motoring offences, employment tribunals (claims for unfair or wrongful dismissal) and immigration (excluding asylum).
  • For small businesses: debt recovery (up to £100k), employment tribunals (defending claims for unfair or wrongful dismissal) and licensing applications for business premises.

The SRA also plan a new searchable register providing information on all solicitors and regulated law firms in England and Wales, including details on the areas of law they practise and any regulatory matters and a digital badge scheme which regulated firms will need to display on their websites promoting the public protections being regulated provides to their clients.

Details of how these provisions will apply in practice are as yet unavailable.  The reforms still require Legal Services Board approval before coming into effect. Subject to this, the changes are expected to be implemented on a phased basis from the end of 2018 onwards which will be preceded by information for firms on the reforms and how to prepare for any changes.  Questions which will need to be answered will include the amount of information, how prices relate to matters where a fixed price cannot be given, the amount of work which will be included within a price (for example number of letters, number of phone calls etc.) and what firms who do not have a website, or whose website is unsuited to the task, will need to do to publish their prices.

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