Why can’t lawyers get costs information right?
It’s over 20 years since the first guidance about costs - the Written Professional Standards - appeared, followed closely by Rule 15 and the Solicitors’ Costs Information and Client Care Code, yet complaints about costs, and the related information provided to clients, remain one of the highest causes for complaint.
The YouGov survey just published on 31 May 2012 by the Legal Consumer Services Panel makes dismal reading. Their results show that client satisfaction with the clarity of information about costs has dropped from 80% to 70% in the last year, a decrease of 12.5% in just 12 months.
Similarly, the Legal Ombudsman’s report in March 2012 highlighted that up to a quarter of the 90,000 annual complaints they receive relate to costs - where a client has felt overcharged, confused or been surprised at the charges presented by their lawyer. So that’s about 22,500 clients or customers in one year sufficiently dissatisfied or confused about lawyers’ costs to make a formal complaint.
Is this failure to be transparent and give full information about costs arising because lawyers still see customers as clients? The Legal Ombudsman is certainly of the view that what solicitors have to do is treat those using legal services as customers because in most businesses providing services that are focused on the customer, it is recognised that the customer’s requirements are paramount.
The regulator’s view is echoed by new entrants into the legal market. Martyn Wates, deputy group chief executive of the Co-operative Group, recently said about the legal profession that it has the wrong mindset'. He explained: 'People don’t want to be treated as a client. They don’t want to be talked down to or patronised. They want to be a customer.'
Research data provided by the YouGov survey for the Legal Services Board on First Tier Complaints Handling, published June 2011, provides some evidence to support this, with its findings about why legal service consumers are dissatisfied. Those surveyed said that when using legal services they want to be treated as human beings, not just another case. The survey respondents also complained of not being treated with respect.
All the evidence suggests that now is the time for change. To survive in the changing legal landscape, solicitors must take notice of the evidence and make changes to how they communicate with their clients and how they explain costs, as well as ensuring the administrative side is managed with costs information that is clear and regularly updated.
It isn’t just the threat of disciplinary sanction or fines, nor the consequent loss of reputation that is at stake now.
The threat now is of loss of work, as legal services consumers can now choose to become customers of the new alternative business structures - where it seems that the customer is king. A world where fixed fees and transparency are becoming the language of legal costs, rather than hourly rates and disbursements.
Jeanette Lucy is the director for compliance, quality and learning with law firm network LawNet