Birmingham Law Society warns proposed SRA complaints rules will increase costs and burdens on firms, without improving consumer outcomes. The Society’s Professional Regulation Committee has urged the SRA to abandon proposed new requirements governing first-tier complaints.
In response to the SRA’s consultation, Changing our requirements on first-tier complaints, the Committee expresses concerns that the new rules would create new, unnecessary burdens on firms in an already challenging regulatory and trading environment.
Cary Whitmarsh, Chair of the Committee says:
“Whilst the SRA has cited statistics which it says demonstrate poor complaints handling, most firms comply with the existing, already extensive rules. The new proposals will not cause those who do not comply to change their behaviour. Firms are already required to explain their complaints procedures, relevant timescales and clients’ rights to approach the Legal Ombudsman. The proposed duties to provide a resolution timeline and regular progress updates would add administrative burdens without addressing the underlying concerns about inconsistent or defensive complaints handling”.
The Committee also warns that key terms within the new rules lack clear definitions. The broad proposals could capture informal expressions of dissatisfaction, professional negligence claims and data protection complaints that may need to be handled under different legal and regulatory regimes.
Not only do the new rules place obligations on solicitors to emphasise the right to complain – obligations which exist in no other profession in the Committee’s view – but worryingly they require firms to assess complaints “impartially”. The Committee says firms must retain the right to defend themselves against disputed, tactical or negligence-based claims, with unresolved matters capable of referral to the Legal Ombudsman or the courts.
Complaints have already risen, not least given the impact of generative-AI. The SRA and Legal Ombudsman are already overwhelmed. These new rules will generate more satellite complaints, increase pressure on regulators and raise compliance and professional indemnity insurance costs for firms and consumers.
The Committee recommends that the SRA instead consider practical measures such as a warning notice or a model complaints-handling procedure. It also calls for the definition of a complaint to be limited to formal complaints made or accepted under a firm’s complaints procedure, allowing informal concerns to continue to be resolved quickly and proportionately.
Mr Whitmarsh added: “The SRA is in the midst of huge organisational and cultural change. It has to repair its relationship with the profession in order to be an effective regulator. These new rules run contrary to those objectives. They are unnecessary, unclear and will not promote or improve consumer confidence and outcomes.”
The Committee calls on the SRA to take a fresh look at this issue rather than to proceed slavishly with its plans. The proposed rules are a missed opportunity for the SRA to do what it has promised – to work with firms in partnership, in order to promote high standards and improve consumer confidence.
Consulation paper response here.