Law firms are increasingly reaping the benefits of altering their business models in order to meet the financial squeeze on their practices. The challenge in doing so lies in maintaining an efficient, top level legal service to their clients.
Many firms are enhancing the delivery of legal services by successfully drawing on the skills of non-solicitor staff, notably paralegals and other admin staff tasked to undertake routine traditional legal work. A tangible benefit is that this frees up valuable time for qualified lawyers to concentrate on the specialist legal work.
Managing the Risk
From high level, multi-disciplinary process management in large law firms with paralegal teams undertaking high volume, repetitive legal process work; to firms employing a small number of paralegals to carry out basic legal work, one thing is clear: managing the risks associated with using unqualified fee earning staff is essential to a law firm's daily operation.
Whilst the changing legal landscape and a sluggish economic recovery is forcing law firms to re-examine how they deliver their legal services, ensuring non-qualified staff are effectively supervised is critical. In a salutary forewarning of the risks, the Solicitors Disciplinary Tribunal is reportedly seeing a steady stream of cases involving lack of supervision since the Maitry case where a solicitor (who was in fact the firm's managing partner) was fined for inappropriate supervision of a conveyancing clerk.
What does the Regulator say?
Law firms are required by the SRA to run their businesses in accordance with sound financial and risk management principles (Principle 8). They must implement and maintain proper systems and controls for complying with this obligation. In the context of supervising staff, firms must ensure they have appropriate systems in place for monitoring staff – whether they are unqualified, in training, or qualified but inexperienced.
What are the risks?
Where an employee is not properly supervised, mistakes are highly likely. Mistakes may involve a minor, easily corrected blunder – or a critical error with profound consequences for the firm. This might be an undertaking given without authority which cannot be complied with, or a letter giving incorrect and financially disastrous advice to a client.
The SRA will deal severely with a firm that breaches its obligations under the Rules and likely impose a hefty financial penalty. The firm's reputation will also be undoubtedly tarnished. Firms subjected to the SRA's sanctions, along with negative publicity, may never recover their reputations.
What can you do?
Managing the risk should not be an onerous task for the firm that takes its risk management obligations seriously. Firms should be able to demonstrate appropriate levels of supervision for its non-solicitor fee earners. We advise, for instance:
- Simple checklists with key dates
- Reviews at key stages of a transaction
- Meeting with the relevant fee earner at regular intervals
- Ensuring training principals responsible for trainee solicitors are properly carrying out their responsibilities
How can we help?
What works for one firm may not work for another. We will help you manage the specific risks to your firm in relation to your unique business.
We are the leading experts specialising in advising law firms on all risk management solutions including appropriate supervision of their staff at all levels. We offer full risk management advice and solutions and can review your existing policies and advice on what action you need to take. We will also advise you on how to comply with your ongoing responsibilities to the SRA.
We offer clients free advice, information and guidance to help them effectively manage their practice in a highly technological age.