SRA commits to new clearer Handbook promoting high standards and choice

Today we have announced changes that will help drive high professional standards, remove unnecessary bureaucracy and free up solicitors to work in new markets.

Following extensive consultation, we have announced the first phase of changes to our Handbook. Currently, with a 30 page code of conduct and more than 400 pages of rules, the Handbook is long, complex, onerous and costly to apply. Consultation showed that there was broad support for simplifying it. The first phase of revisions creates shorter, clearer principles and codes, as well as much simpler Accounts Rules. For instance, the new rules have been reduced from 41 to seven pages by focusing on the protections that really matter, specifically keeping clients’ money safe.

The revised Handbook will have a Code of Conduct for solicitors and another for firms. The aim is that every solicitor is absolutely clear about their personal obligations and responsibility to maintain the highest professional standards, whether they work in-house, inside or outside a firm that is Legal Service Act (LSA) regulated*. The separate code for firms aims to make sure they have clarity about the systems and controls they need to provide good legal services for the public. The combined length of the two codes, with the principles, is 14 pages – reducing the length of the code by more than half.

We also want to help tackle the problem that too many people cannot access the services of a regulated legal professional. It has committed to getting rid of barriers to solicitors working freely in the legal sector, including in the growing number of ‘non-LSA regulated’ firms providing legal services such as will-writing and resolving employment disputes. Changing outdated rules constraining access to solicitors will make it easier for people to benefit from their expertise and high standards, potentially in more affordable ways.

Paul Philip, SRA Chief Executive said: “Clear, high professional standards are at the heart of public confidence in solicitors, law firms and a modern legal sector. Our consultation confirmed that a shorter, clearer Handbook, with a sharp focus on professional standards, is the way forward. Pages and pages of complex rules hinders rather than helps compliance. It drives costs rather than good practice and consumer protection. We want to move away from ticking boxes to putting more trust in professional judgement.

“That means we can make changes to give solicitors and firms greater flexibility. Freeing up solicitors to work where they choose is good for the profession, opening up career opportunities, and good for the public. It will help to tackle the issue that too many people and businesses simply cannot afford to access the help of a solicitor when they have a legal problem. Removing restrictions on where solicitors can work will give the public more choice, increasing access to high quality legal services at a price they can afford.”

Our decision follows direct engagement with around 11,000 solicitors and members of the public on its proposals. Together there were more than 400 responses to its consultation on the codes and principles, and Accounts Rules.

There was broad support for the overall approach of cutting bureaucracy and simplifying the Handbook. On the detail, views were more diverse. We have made changes to respond to feedback. For instance it recognised that its proposals around greater flexibility on client money could have had cost implications for some firms. So it has amended its definition of client money, so the vast majority of firms with a client account can continue as they are. It has also made it absolutely clear that the ban on cold calling remains.

The plans to remove restrictions on where solicitors can work were the most divisive in terms of consultation feedback. There was strong support from the Competition and Markets Authority (CMA), consumer groups and charities, but also strong opposition from the Law Society and some solicitors. We have committed to keeping the impact of any change under review. It will address concerns around the potential for consumer confusion by making sure there is clear communications around the extent of the protections in place for the public when they are using a solicitor in a non-LSA regulated firm.

We will be consulting on proposed changes to other parts of the Handbook, including the authorisation, practice framework rules and new enforcement policy, later this year. The new arrangements will not be introduced any earlier than autumn 2018.

A summary of the responses to the consultation and our decision on next steps are available on our Looking to the future pages.

*When referring to Legal Services Act regulated firms, this means those who are authorised to deliver reserved legal activities under the Legal Services Act (LSA).