The Solicitors Regulation Authority (SRA) has confirmed that it will randomly check hundreds of law firm websites to check they are meeting new requirements for price and service transparency.
The SRA stresses it does not wish to dictate what fees are charged, and that it appreciates the new rules require changes to websites, but has made it clear non-compliance is not an option. This is something of a departure from the rather non-urgent approach taken by the regulator at the outset – possibly in reaction to some of the negative reactions from the profession.
The regulator confirmed last month that they plan to ‘sweep’ around 500 law firm websites chosen at random for compliance, as part of regular checks. Firms found to have taken no steps to comply, deliberately refused to comply, or deliberately provided vague, misleading or meaningless information, will be in line for a rebuke or possibly a fine.
SRA chief executive Paul Philip said that the organisation has always wanted to take a proportionate approach, but warned those continuing to disregard the rules. ‘This is not a hugely important thing, but you are obliged to do it and you are forcing us into taking disproportionate action when you should just comply and move forward,’ said Philip. ‘I have no doubt we will end up with a rump of people who are not doing it.’
The SRA also confirmed it will work with consumer group to raise awareness of the new requirements and to encourage reporting.
Since December, firms have been subject to new regulations requiring them to publish details of their prices and service information if they work in certain areas of law. The new rules apply to conveyancing (residential), probate (uncontested), motoring offences (summary offences), immigration (excluding asylum), employment tribunals (unfair or wrongful dismissal), debt recovery and licensing applications.
Price information must be presented in a ‘clear and easy to understand format’, providing a total cost or, if this is not possible, an average or range of costs.
However many firms remain unsure as to how to represent these changes in practice and, principally, what changes to make to their websites in order to meet the requirements.
Providing data and information that allows accurate comparisons
The answer, of course, is demonstrating why the price is fair. This can include explaining the complexity of the advice required including why using an experienced (and more expensive) adviser could save a lot of heartache and expense further down the line.
Conversely there may be occasions when a more straightforward conveyancing transaction can, and should, cost a lot less and can be offered on a more ‘commoditised’ basis. This is seen in operation currently, for example, with panels offering conveyancing services where price comparison-style websites offer obvious comparisons between prices by literally listing providers side by side with prices clearly displayed.
Can’t we just quote?
Areas such as conveyancing and personal injury work have led the way in this area being used to working very much on a fixed price / fixed percentage offers and, on occasion, on a ‘no win no fee’ basis.
However what should a firm do about providing the ‘indicative’ pricing required where a job is more complicated and where it is less easy to offer a simple ‘pick and mix’ menu of prices? Or where a firm has multiple offices and charges different fees according to the different geographical locations of the offices?
Granted; some may argue that it is in a lawyer’s nature to want to know the full details of the case in hand before offering a quote or cost estimate and that this can be frustrating to a customer making an initial enquiry who just wants a ‘ball park’ idea of costs.
Given that the regulators’ intent is to simplify the pricing of legal services and to give consumers enough information to enable them to shop around this creates an inherent tension. Many lawyers, and particularly those representing small law firms, have argued that quoting for each case on an instance-by-instance basis taking into account all the pertinent circumstances is the best way for clients to get accurate information on what their matter might cost and that this may meet the transparency requirements in a far more precise way than by providing what can be seen as a more general layer of pricing information before clients reach the formal quote stage.
Be that as it may, the regulators’ requirements mean that firms will still need to provide indicative pricing information, along with details of service levels and of the personnel who may deal with the work, upfront on their websites before proceeding to detailed quote stage.
Firms may present a range of prices based on, for example, a typical sale value; an average price, or provide an online quote calculator. They may also choose to post a ‘price list’ for common additional costs in order to provide a more transparent idea to the customer of the items they may end up paying for.
Whichever route is chosen, the regulator will look to see whether the way the information is represented meets the spirit of its reforms - that is, broadly does it allow the ‘apples with apples’ comparison. At the time of launch the regulators said that they will not have the resources to carry out “dawn raids” on firms in order to check whether firms are fully compliant. They will however be working closely with the Legal Ombudsman (LeO) to investigate any obvious trends and increases in complaints relating to individual firms and will also take up complaints made by members of the public by way of visits or conversations with the firm concerned.
Service and staff
Paul Saunders, Managing Director of Legal Eye, says: “Although many firms are focusing on price this is about overall transparency. It’s about refocusing on what clients a firm wants to attract, being really clear about what those clients want, and representing information that meets those needs. For example, where a client wants a high degree of contact, face to face or on the phone on a complex high value matter which is of financial and emotional significance to them then they are likely to recognise the value of paying a higher fee than they might get elsewhere in order to secure the right level of expertise and service.
“It’s about being clear as to the value to the client – and to know that we need to understand what drives them. Sometimes this will be purely cost but given we know that the research shows that clients also value good communication and customer service we need to price accordingly in order to deliver that level of contact.”
The requirement to include more detail on what staff may be working on particular matters gives firms a chance to showcase their particular skills and expertise. The regulators have confirmed that there is no need to specify exactly which individual will be working on each matter, and neither is a lengthy ‘CV’ needed for each – which may be especially difficult for a volume conveyancer for example – but that an indication of the level of experience and qualification will be needed.
Firms also need to provide a timeline or representation of key stages in a matter which clearly set out for customers what’s involved in the matter. This is not intended to be a document against which clients can ‘hold’ their lawyers – however, how much importance the timelines are given by clients will remain to be seen as the months progress.
Legal Eye specialises in risk and compliance advice for law firms combined with an understanding of the realities of running a law firm and of the commercial needs of the firm as a business.
We’re currently helping many firms not only to ensure they are compliant but also to make the most of the commercial opportunities being presented by the price and service transparency requirements and current regulatory reforms.
For further information please contact Jody Evans at Legal Eye on 07384 461414 or at firstname.lastname@example.org for more information.