Outcomes focused regulation

Outcomes Focused RegulationThe move to risk-based system

Outcomes Focused RegulationThe move to a risk-based system

ContentsOverviewThe SRA HandbookThe Ten PrinciplesThe Code of ConductPractice Management Issues

ComplaintsEquality and DiversityManagement of the BusinessReporting Obligations – COLPs and COFAs



Why is it important?

“3.1 ...... the Principles apply to you, in relation to your activities carried out from an office in England and Wales, if you are a solicitor ...... manager, employee or owner of a [recognised] body .... an employee of a sole practitioner .....[or] any other person who is a manager of employee...”


What is OFR?OFR is a risk-based approach to regulation whereby:•The needs of the client come first (subject to interests of public as a whole);•The firm is encouraged to achieve an outcome which benefits the client;•The firm is expected to create policies and procedures which achieve this.


THE SRA Handbook

8 sections:• The Principles,• The SRA Code of Conduct,• The Accounts Rules,• Authorisation and Practising Requirements,• Client Protection,• Disciplinary and Cost Recovery,• Specialist Services,• Glossary


The Ten Principles1. Uphold the rule of law and the proper administration of justice,2. Act with integrity,3. Don’t allow your independence to be compromised,4. Act in the best interests of each client,5. Provide a proper standard of service to your clients,6. Behave in a way that maintains the trust the public places in you

and in the provision of legal services ,7. Comply with your legal and regulatory obligations and deal with

your regulators and ombudsmen in an open, timely and co-operative manner,

8. Run your business or carry out your role in the business effectively and in accordance with proper governance and sound financial and risk management principles,

9. Run your business or carry out your role in the business in a way that encourages equality of opportunity and respect for diversity, and

10. Protect client money and assets


The Code of Conduct• You and Your Client• You and Your Business• You and Your Regulator• You and Others• Application, Waivers and Interpretation


You and Your Client• Client Care• Equality and Diversity• Conflicts of Interest• Confidentiality and Disclosure• Your Client and the Court• Your Client and Introductions to Third Parties


Other SectionsSection 2 – You and Your BusinessManagement of Your BusinessPublicityFee Sharing and Referrals

Section 3 – You and Your Regulator

Section4 – You and OthersRelations with Third PartiesSeparate Businesses

Section 5- Applications, Waivers and InterpretationApplication and Waivers provisionsInterpretation


Chapter Structure• Pre-amble• Outcomes• Indicative behaviours


Client Care OutcomesTreat clients fairlyProvide services in a way

that protects interestsComply with law and code

when terminating retainerHave adequate skills and

resourcesDeliver services

competently and taking account of client needs

Fee agreements to be legal and in best interests of clients

Inform clients of how services are regulated

Provide PII

Written information given on complaints

Information about LeO givenComplaints dealt with

promptlyClients put in position to

make informed decisionsClients given information as

to costsClients told about

challenging billsAccount to clients for

financial benefitsInform clients of acts or

omissions which might give them a claim against firm


ComplaintsO(1.9) clients are informed in writing at the outset

of their matter of their right to complain and how complaints can be made;

O(1.10) clients are informed in writing, both at the time of engagement and at the conclusion of your complaints procedure, of their right to complain to the Legal Ombudsman, the time frame for doing so and full details of how to contact the Legal Ombudsman;

O(1.11) clients' complaints are dealt with promptly, fairly, openly and effectively;


Equality and Diversity• Age• Disability• Gender Reassignment• Marriage and Civil Partnership• Pregnancy and Maternity• Race• Religion or Belief• Sex• Sexual Orientation


Discriminatory Activities• Direct Discrimination• Discrimination by Association• Discrimination by Perception• Indirect Discrimination• Harassment• Harassment by a Third Party• Victimisation+• Failure to make reasonable adjustment


Code Requirementsnot to discriminate unlawfully, or victimise or harass

anyone, in the course of professional dealings;to provide services to clients in a way that respects

diversity;to make reasonable adjustments to ensure that

disabled clients, employees or managers are not placed at a substantial disadvantage compared to those who are not disabled, and that the costs of these adjustments are not passed on to the person with the disability;

ensure that the approach to recruitment and employment encourages equality of opportunity and respect for diversity;

ensure that complaints of discrimination are dealt with promptly, fairly, openly, and effectively


Management of the business have a clear and effective governance structure and reporting lines;

have effective systems and controls in place to achieve and comply with all the Principles, rules and outcomes and other requirements of the Handbook, where applicable;

identify, monitor and manage risks to compliance with all the Principles, rules and outcomes and other requirements of the Handbook, if applicable to you, and take steps to address issues identified;

maintain systems and controls for monitoring the financial stability of your firm and risks to money and assets entrusted to you by clients and others, and you take steps to address issues identified;

comply with legislation applicable to your business, including anti-money laundering and data protection legislation;


Management of the Businesstrain individuals working in the firm to maintain a level of

competence appropriate to their work and level of responsibility;

comply with the statutory requirements for the direction and supervision of reserved legal activities and immigration work;

have a system for supervising clients' matters, to include the regular checking of the quality of work by suitably competent and experienced people;

not outsource reserved legal activities to a person who is not authorised to conduct such activities;


Management of the Businesssubject to Outcome 7.9, where you outsource legal activities or

any operational functions that are critical to the delivery of any legal activities, you ensure such outsourcing: does not adversely affect your ability to comply with, or the SRA's ability

to monitor your compliance with, your obligations in the Handbook; is subject to contractual arrangements that enable the SRA or its agent

to obtain information from, inspect the records (including electronic records) of, or enter the premises of, the third party, in relation to the outsourced activities or functions;

does not alter your obligations towards your clients; and does not cause you to breach the conditions with which you must

comply in order to be authorised and to remain so.


Management and Reporting Obligations• Compliance Officer for Legal Practice (COLP)

▫Compliance with authorisation and rules (except Accounts Rules)

▫Compliance with statutory obligations▫Recording of failures to comply▫Accounting to SRA for failures

• Compliance Officer for Finance and Administration▫Compliance with Accounts Rules▫Recording of failures to comply▫Accounting to SRA for failures