Risk Outlook - Bar Standards Board

An overview of the legal market and our regulatory priorities

APRIL 2016

The BSB Regulatory Risk Outlook 2016

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This is one of three documents that we are publishing about our general approach to risk-based regulation:

• the Risk Framework describes our general approach to identifying and managing risks in the legal system; • the Risk Index categorises those risks; and • the Risk Outlook prioritises three risk themes which we think should be the current focus of our regulatory attention.

These documents also complement the approach set out in our 2016-19 Strategic Plan. You can find all of these documents at https://www. barstandardsboard.org.uk/about-bar-standards-board/how-wedo-it/our-risk-based-approach/

If you require this document in an alternative format, please contact us via email at [email protected] or telephone us on 020 7611 1444.

Contents

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Contents Chair’s Foreword................................................................................................................................ 5 Executive Summary............................................................................................................................6 Introduction.............................................................................................................................................. 6 Regulatory Objectives.............................................................................................................................. 6 Regulatory Context – Part I of this report................................................................................................ 6 Identifying three Risk Themes – Part II of this report............................................................................. 7

Introduction...................................................................................................................................... 10 Who is the Risk Outlook for?................................................................................................................. 10 What is a Risk Outlook?......................................................................................................................... 10 What is in the Risk Outlook?.................................................................................................................. 11 How has the Risk Outlook been developed?.........................................................................................12 What is the purpose of the Risk Outlook?.............................................................................................. 13 How can you provide feedback about the issues raised in the Outlook?............................................. 13

Part I Regulatory context.................................................................................................................. 16 The market we oversee...........................................................................................................................16 Market context.........................................................................................................................................19 Legal System......................................................................................................................................................19 Client experience and choice . .......................................................................................................................... 25 Structural changes within the sector................................................................................................................28 External Factors..................................................................................................................................................30

Why we think this matters...................................................................................................................... 35

Part II Priority risk themes................................................................................................................35 The kind of market we want to see........................................................................................................ 36 Background............................................................................................................................................ 36 Consumer vulnerability......................................................................................................................................36 Understanding consumer needs....................................................................................................................... 37 STAGE 1: Identifying......................................................................................................................................... 40 STAGE 2: Choosing............................................................................................................................................42 STAGE 3: Reveiving............................................................................................................................................43 STAGE 4: Follow-up...........................................................................................................................................45

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The role of the regulator........................................................................................................................ 46 What we need to do............................................................................................................................... 46 What the Bar and its institutions can do to help.................................................................................. 46 Why we think this matters..................................................................................................................... 47 The kind of market we want to see........................................................................................................ 48 Background............................................................................................................................................ 48 Joining the Bar: financial and social barriers ...................................................................................................50 In practice: working culture at the Bar.............................................................................................................. 51 Opportunities and progression at the Bar........................................................................................................ 52 Anti-discriminatory practice.............................................................................................................................. 55

The role of the regulator........................................................................................................................ 56 What we need to do............................................................................................................................... 56 What the Bar and its institutions can do to help...................................................................................57 Why we think this matters..................................................................................................................... 59 The kind of market we want to see........................................................................................................ 59 Background............................................................................................................................................60 Causes of commercial pressure....................................................................................................................... 60 Evidence and consequences of commercial pressure......................................................................................63

The role of the regulator........................................................................................................................ 66 What we need to do............................................................................................................................... 66 What the Bar and its institutions can do to help.................................................................................. 66 Let us know what you think................................................................................................................... 67

Chair’s Foreword

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Chair’s Foreword Welcome to our very first Risk Outlook. What follows is an overview of the market for barristers’ services in 2016 with an emphasis on the aspects on which we are focusing our regulatory attention. This is an important document in understanding the context in which we regulate the Bar, and the reasons why we take the action that we do. Of course, as you would expect, we make our regulatory decisions every single time in the public interest. The Risk Outlook is where, based on the evidence that we have collated, we present our thinking about prioritisation and where we think the biggest threats exist to our statutory regulatory objectives. We would very much like to hear your views on what we present. I am aware that by focusing on “risks” all of the time, we might come across as negative; that we might be seen as an organisation that thinks everything is – or is about to go – wrong. To a large extent, trying to anticipate what could go wrong – and taking action to prevent that happening – is what being a regulator is about. However, throughout this document we have tried to accentuate the positive: to present some of the challenges as opportunities for us and especially for the Bar. Let me give you an example of where the regulator’s interests align directly with opportunities for those it regulates. One of the main themes that we have identified in this Outlook concerns the fact that large numbers of prospective clients for the Bar are currently unable or unwilling to access the services of a barrister. The reasons for this are numerous, complex and to some extent, inter-connected. (We discuss these reasons in depth from page 35.) We are concerned about this from a regulatory perspective, because one of the reasons that we exist is to make sure that everyone has equal access to justice, and this cannot

be achieved if parts of society are not accessing appropriate legal services. However, this same fact about unmet demand, should also be seen as an opportunity for the Bar. In short, there are large numbers of clients “out there” to be served. Admittedly, winning and serving these clients in a way that can be economically viable is challenging. It will mean doing things differently, innovating and marketing services, and becoming faster to exploit new technologies. We are certain that those parts of the Bar that need to adapt can do so successfully. Furthermore, and because it is in the public interest, we want to help the Bar to do this. We want to remove unnecessary regulatory barriers that get in the way of innovation. We want to take appropriate regulatory steps to make sure that everyone – especially vulnerable consumers – can access the market for legal services fairly. Our Risk Outlook is about all of this. And more. There is no doubt that these are challenging times for everyone concerned with the provision of legal services. There is a great deal of uncertainty about the future – not just about the future of practice, but, at the time of writing, about the future regulatory landscape too. We know that things are tough for many parts of the Bar, especially – but not exclusively – for those involved in publicly funded criminal work. However, by embracing change and by working together to address the important themes discussed in this document, we hope to make significant progress to address the “risks” that we have identified. I hope you enjoy reading this Outlook. If you have any comments about anything discussed, please do share them with us. We are keen to hear from you.

Sir Andrew Burns KCMG


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Executive Summary Introduction

Regulatory Objectives

We are publishing three documents about our approach to risk-based regulation:

We have a statutory duty to ensure the regulatory objectives, set out in the Legal Services Act 2007, are met. This Outlook is a forward looking report highlighting the biggest risks to these regulatory objectives over the next few years, where we summarise our evidence and present our analysis.

• the Risk Framework describes the BSB’s general

approach to identifying and managing risks in the legal system;

• the Risk Index categorises those risks; and • this Risk Outlook prioritises three risk themes

which we think should be the current focus of our regulatory attention.

These documents also complement the approach set out in our 2016-19 Strategic Plan. All of these documents are available on our website. There are many parts of the legal services market which are flourishing. The quality and integrity of our legal system attracts clients from all over the world. However, the market is not without risk. As a riskbased regulator keen to focus our resources where we can best provide value for consumers and for legal professionals, we need a thorough understanding of those risks. In this Risk Outlook we explore the risks in three important areas.

Inevitably, it focuses on what could go wrong due to our focus on the biggest risks, but these also present opportunities for the Bar and its consumers. This is our first Risk Outlook. It was published in April 2016. The market and associated risks will change and new evidence will emerge. We will publish updates in the future. In the meantime we want to share our insights and engage with the Bar and other interested parties to discuss how we address these risks over time.

Regulatory Context – Part I of this report Part I of this Outlook explains the context in which we regulate the Bar. It considers the state of the market in 2016. It explores attributes of the legal system and the law itself that influence how effectively the market is operating to meet the needs of those who rely upon the legal system. It also considers client experience and choice within the market for legal services, discussing the expectations of clients and the range of providers from which they may choose.

Executive Summary

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Identifying three Risk Themes – Part II of this report Having considered the regulatory context and identified all of the possible risks to the Regulatory Objectives in the Risk Index, we have grouped the most significant risks into three risk themes: 1 Failure to meet consumer need; 2 Lack of diversity, discriminatory working culture and practices; and 3 Commercial pressures on providers.

In Part II of this Outlook, we explore each risk theme in detail. We explain why we think each theme matters, the kind of market we want to see, what we need to do as the regulator and what we think the Bar and its institutions can do to help.

Theme 1 at a glance:

Failure to meet consumer needs This theme concerns areas in which the legal services market may be failing adequately to meet the needs of those who require legal help. We see indicators of rising levels of unmet legal need, and what consumers expect from the legal services market continues to change. We want to understand this better and help the profession we regulate to respond. The full discussion about this theme commences on page 35. The following points provide a brief summary:

• The needs and rights of consumers and the public go to the heart of our regulatory objectives. • Individual vulnerability, legal complexity, legal aid reduction and a lack of general understanding of the role of legal services providers potentially prevent access to justice.

• For those who do obtain legal advice, they can sometimes receive poor service or inadequate advice and may view the advice as poor value for money.

• Obtaining redress when things go wrong can be difficult for consumers. There are many routes to take, depending on what has gone wrong.

• We are keen to develop better our understanding of the interaction between consumers and providers of legal services.

• The profession needs to continue to develop its understanding of the consumers it serves.


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Lack of diversity; discriminatory working culture and practices This theme considers the lack of diversity within the Bar and the risk of discriminatory working culture and practices. These can affect the Bar’s ability to be strong and effective, to meet the diverse needs of consumers and to present a sustainable career opportunity for potential barristers. The full discussion about this theme commences on page 47. The following points provide a brief summary:

• For society to have continuing faith in the legal system, the system needs to reflect the changing make-up of the people it serves. The Bar is a key source of appointments to the judiciary, making it especially important that it is diverse.

• The Bar has worked hard to encourage diversity, but there is room for improvement. • Some of the challenges in achieving equality and diversity within the Bar are as a result of challenges within wider society. There are ways in which we and the Bar are trying to mitigate some of these challenges.

• One important aspect of diversity is to consider women’s experiences of the equality rules in our Handbook. We recently undertook a survey of women barristers about this and now need to consider our response to the findings.

• Work at the Bar involves many demands that could affect their general wellbeing. This could encourage

anti-social or inappropriate workplace behaviours, potentially affecting not just members of the Bar, but the public they serve as well.

• As the regulator, we must continue to adapt our own approach. We must lead by example in order to strike a balance between enabling and requiring the Bar to improve diversity and encouraging a positive working culture.

• We want the Bar to work with us to develop strategies that encourage diversity and positive working practices.

Executive Summary


Commercial pressures on providers Commercial pressures are a fact of life for many organisations, not least legal services providers. These pressures can stimulate innovation and creativity, enabling competitive advantages to be created, improving the consumer experience and potentially driving down costs. However, providers react to commercial pressure in different ways. Many respond positively, but others respond in ways that could lead to outcomes that harm consumers. This is usually because organisations find it hard to manage the pressure they are facing – especially if the commercial pressures are excessive. Sometimes, it can be difficult to acknowledge the extent of the pressure. At other times, a lack of knowledge can prevent providers finding appropriate solutions. Occasionally, providers may be driven to take inappropriate or reckless actions. In this risk theme, we look at the most significant causes of commercial pressure on the Bar and the outcomes that can arise: both good and bad. The full discussion about this theme commences on page 58. The following points provide a brief summary:

• Whilst commercial pressures and interests do not themselves constitute a regulatory issue (in fact they may stimulate positive growth and innovation), the potential impact these pressures have on the quality and coverage of legal services remains a concern for us.

• Commercial pressures that result in a compromising of ethical principles, lowering of standards and/or

unrealistic or hidden pricing in order to win business, may not be in the interests of those who rely on the market for quality advice, nor sustainable for providers.

• A significant proportion of those whom we regulate have historically relied on publicly funded work. Cuts

in government spending impact the Bar and its clients adversely. Some of the pressures identified have reduced the demand for or affordability of legal services. The amount of work available to the Bar in some areas has reduced.

• Other pressures involve increased competition from other providers and certain clients having unrealistic – and sometimes unethical – expectations of their lawyer.

• In line with our statutory economic growth duty, we need to stay abreast of market developments and

identify opportunities to remove unnecessary burdens. We need to support and encourage the development of a diverse and healthy legal services market.

• The Bar needs to understand, plan for and adapt to the changing economic situation. It needs to maintain its focus on its Core Duties and identify opportunities to innovate.

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Introduction We are publishing three documents about our approach to risk-based regulation:

• the Risk Framework describes the BSB’s general

approach to identifying and managing risks in the legal system;

• the Risk Index categorises those risks; and • this Risk Outlook prioritises three risk themes

which we think should be the current focus of our regulatory attention.

Our response to the risk themes in our Risk Outlook has directly informed our strategy for the next three years. This strategy is set out in our 2016-19 Strategic Plan. You can find all of these documents and more about risk-based regulation on our website. If you want to find out more about what we do, visit our website.

What is a Risk Outlook? A Risk Outlook is a forward looking report containing our assessment of the biggest risks to our regulatory objectives over the next few years. We often refer to it simply as the “Outlook” in this document. The Regulatory Objectives are set out in the Legal Services Act 2007.

The Regulatory Objectives (from the Legal Services Act 2007, Section 1)

1 Protecting and promoting the public interest 2 Supporting the constitutional principle of the rule of law

3 Improving access to justice 4 Protecting and promoting the interests of consumers

5 Promoting competition in the provision Who is the Risk Outlook for? We envisage this Risk Outlook being of particular interest to members of the Bar and our staff. It may also be of interest to those who work with the Bar, legal consumers or organisations that represent their interests and others.

of services

6 Encouraging an independent, strong, diverse and effective legal profession

7 Increasing public understanding of the citizen’s legal rights and duties

8 Promoting and maintaining adherence to the professional principles:

• independence and integrity • proper standards of work • acting in a client’s best interests • duty to the court: acting independently in the interests of justice • confidentiality of client affairs

Introduction

We have a statutory duty to ensure that these regulatory objectives are met. We do this independently of the profession. As the regulator of barristers and specialist legal businesses, our Outlook focuses on issues relating primarily to the provision of services traditionally provided by the Bar, such as court-based advocacy and litigation, and specialist legal advice. To do this, we also need to consider the wider legal services market (see page 16 for an explanation of what we mean by “market” in this context), because the people we regulate are just one part of the inter-connected legal system in England and Wales. As the regulatory objectives are wide-ranging, there are many risks which could prevent them from being achieved. By identifying the biggest risks, we are able to focus our attention on the areas where we can make the biggest difference as a regulator. How we use risk-based regulation is explained in detail in our Risk Framework, which is published alongside this Outlook. We gather evidence to support our assessment of risk. The Outlook is where we summarise that evidence and present our analysis to show how we have determined the biggest threats to the regulatory objectives and therefore justify our regulatory focus for the coming time period. We regulate in a fast-moving environment. Things change. New evidence comes to light. New threats to the regulatory objectives emerge and others recede. The Outlook, therefore, is only a snapshot in time. This is our first Outlook publication. We expect to publish updates in the future. We also intend to publish more detailed insight papers on specific themes from time to time. Inevitably, a Risk Outlook will focus on what could go wrong. That does not mean to say that it will go wrong. In our case, this means focusing on those aspects of the legal services provided by the Bar that pose greatest risk to our regulatory objectives.

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Another way of thinking of this is to consider potential “mismatch” between what the Bar provides and what is expected by the individuals or wider public that it serves.

What is in the Risk Outlook? The Outlook is divided into two parts:

• Part I is the regulatory context. It describes the

environment in which legal services are provided by the Bar;

• Part II contains the priority risk themes. It identifies key areas of risk to achieving the regulatory objectives.

Part I (the regulatory context) briefly describes the legal sector and our role within it. We also explore some aspects of the law and the environment in which legal services are provided. These set important context for the risk priorities that follow. We look at:

• Legal System – aspects of the law and legal services that define the nature of the legal services market;

• Client experience and choice – the expectations of

clients and the range of providers from which they may choose;

• Structural changes in the sector – including

regulatory and other systemic changes in the administration of justice; and

• External factors – wider influences including

economic, political, social and technological developments that affect both providers and consumers in the market.

In Part II we explore three different risk themes, and indicate our response to them:

• Failure to meet consumer needs;


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• Lack of diversity; discriminatory culture and working practices; and

• Risks arising from commercial pressures on providers.

The analysis within Part II aims to answer several key questions about each theme:

• Why do we think it matters? • What is the kind of market we want to see? • What is the background? • What is the role of the regulator? • What do we need to do? • What can the Bar do to help? It is not the role of the Outlook to set out in detail what regulatory action (if any) we will be taking to address the risks identified or to provide milestones for relevant initiatives. Our Strategic Plan highlights how the opportunities for us and those we regulate to make improvements are shaping our regulatory activity and engagement. For more information on our work programme, take a look at the full three-year Strategic Plan or our annual Business Plan. 1

How has the Risk Outlook been developed? BSB Board members, Committee members and staff have worked together to produce our Regulatory Risk Outlook. The report draws upon a number of inputs, including: regulatory data collection and analysis, desk-based research, risk reports, presentations by experts and discussions with stakeholder representatives including those from consumer and community organisations as well as members of the Bar. Source material was gathered between October 2015 and March 2016. The Outlook brings these sources together to understand the most significant risks present in the market. We have referenced evidence where we think this may be of interest to readers. In arriving at the three risk themes, we started by considering the full range of risks to our regulatory objectives identified in our Regulatory Risk Index. From these five categories, we prioritised areas of focus for the first BSB Risk Outlook. Following preliminary analysis, our leadership team, Board and Committee members then further refined this prioritisation and the resulting three themes which have been researched in more detail are those found in Part II of this document. Through this work, we now have a more developed starting base of evidence on which future regulatory analysis and Outlook updates can build.

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Our Strategic and Business plans can be found at https://www. barstandardsboard.org.uk/about-bar-standards-board/how-we-doit/our-strategic-and-business-plans/

Introduction

What is the purpose of the Risk Outlook? The purpose of the Risk Outlook is:

• To guide the development and prioritisation of our regulatory activities;

• To share our insights and expertise concerning areas of significant risk; and

• To support our ongoing engagement with you, our stakeholders.

We will continue to monitor the areas selected for analysis in this report in line with our risk-based approach to regulation (see the Risk Framework for more information on this approach.) This will enable us to see how our own activities and other market changes impact the risk landscape.

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How can you provide feedback about the issues raised in the Outlook? We want to hear from you about the issues and risks raised in this document. We want to know what you think should be done about them and how we might work together to improve access to justice, uphold the rule of law and promote the public interest. We are always keen to know if you have any additional evidence which will aid our understanding of how the market for legal services operates. If you wish to provide any feedback please email us on [email protected] If you would like to speak to someone directly, you can call 020 7611 1444.

2. COURT CASES

LEGAL

4m SUPPLY Court cases a year in England and Wales

1. THE LEGAL SERVICES MARKET

1.62 m

0.25 0.3m5 m

7% £ 26bn 316,000

1.7 5m

UK share of global legal services revenue

Value of UK legal services sector* People employed in UK legal services

Source: The Law Society (2016) Economic value of the legal services sector; TheCityUK (2015) UK Legal Services 2015 *Gross Value Added

3. PRACTISING BARRISTERS IN NUMBERS

CRIMINAL COURTS CIVIL COURTS TRIBUNALS FAMILY COURTS Source: Ministry of Justice (2015) Criminal court statistics quarterly; Family court statistics quarterly; Civil justice statistics quarterly; Tribunal statistics quarterly

4. WHERE BARRISTERS ARE BASED (BY CIRCUIT)

529

63

On their own

Northern

North Eastern

89 100 Midland

15,915

12,339 Wales and Chester

In Chambers

BARRISTERS

439 London

38

Eastern 275 South (excluding London)

711 Western

In a law firm

2,336 In another organisation Source: Bar Standards Board (2016) Core database

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Source: Bar Standards Board (2016) Core database

5. CHOICE OF LEGAL SUPPLIERS*

21 European Source: Bar Standards Board (2016) Core database; Legal Services Consumer Panel (2014) 2020 Legal Services How regulators should prepare for the future *List not exhaustive

REGULATED

Solicitor

Costs Lawyers

Notary

Barrister Licensed Conveyancer

Chartered Legal Executive Patent & Trade Mark Attorney

CONSUMER CHOICE

Unbundled services

Mediator Pro bono support

Voluntary sector

McKenzie friend

Online help

34%

LEGAL

...BUT ONLY 1. PERCENTAGE 1% OF OF ADULTS WHO ADULTS HAVE USED A HAVE LEGAL SERVICE IN THE LAST USED A TWO YEARS... BARRISTER Source: Legal Services Consumer

DEMAND

Panel (2015) Tracker Survey

2. EXPERIENCE OF THE JUSTICE SYSTEM

3. DIFFERENT TYPES OF LEGAL CONSUMER

Type of interaction with the justice system reported by members of the public

Users of legal services fall into the following categories

Defendant in

14%

Jury member

12%

Witness

3%

Applicant in family court

11%

Friend/supporter

3%

Respondent in family court

4% a criminal trial Publicly funded and pro bono

Large organisations

Private clients

Small and mediumsized enterprises (SME)

Government

Source: Oxera / Legal Services Board (2011) A Framework to monitor the legal services sector

7%

Another role

2%

Defendant in civil case

5%

Claimant in a civil case

1%

McKenzie friend

4%

Other professional capacity

20%

Source: Legal Services Board (2015) The legal needs of small businesses

ONLY 2 IN 5 PEOPLE BELIEVE WE HAVE A JUSTICE SYSTEM THAT WORKS WELL FOR CITIZENS

Magistrate

1%

OF SMEs WITH A LEGAL PROBLEM USED THE LEGAL SERVICES MARKET TO HELP RESOLVE IT

Source: Citizens Advice (2015) Responsive justice: How citizens experience the justice system

Source: Citizens Advice (2015) Responsive justice: How citizens experience the justice system

4. TRUST IN PROFESSIONS Percentage of people who think each group will tell the truth

DOCTORS TEACHERS ORDINARY PEOPLE

ACCOUNTANTS

LAWYERS 71%

ESTATE AGENTS 10%

BANKERS

40%

19%

Source: Legal Services Consumer Panel (2015) Tracker Survey

46%

47%

82%


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Part I Regulatory context The market we oversee Our role as regulator is to oversee the Bar in the interests of consumers and the wider public. We do this within the context of the wider legal sector, and it is helpful to clarify our place and how we relate to others. We use the language of a “market” to describe this, reflecting the interplay between those who use legal services (demand side of the market) and the many different providers offering legal services (supply side).

OVERSIGHT

JUSTICE

SUPPLY

DEMAND

Oversight: we are one of several agencies who oversee the market for legal services to ensure that it works effectively. For example, the Ministry of Justice, Competition and Markets Authority, Legal Services Board and Legal Ombudsman have different remits across a wide range of providers and services (including the Bar) and we have counterpart regulatory bodies in other legal professions such as the Solicitors Regulation Authority and CILEx Regulation. Most legal regulators, including the BSB, are linked to a designated “Approved Regulator” under the Legal Services Act. For example, CILEx Regulation is linked to the Chartered Institute of Legal Executives and we are linked to the General Council of the Bar. However the “Approved Regulator” must ensure that its regulatory functions are discharged independently. Hence, we are accountable to an independent Board and are overseen by the Legal Services Board, which is responsible for approving any changes to our regulatory arrangements.

Supply: Legal services are no longer the sole preserve of the regulated professions. They are offered by an increasingly wide range of individuals and organisations, including alternative dispute resolution services and those who exist to help people to handle legal cases themselves, including the voluntary sector, pro bono providers, McKenzie friends and others offering online advice.2

2 Legal Services Consumer Panel (2014) 2020 Legal Services How regulators should prepare for the future

Part I Regulatory context

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REGULATED

Solicitor

Costs Lawyers

Notary Chartered Legal Executive

Barrister Licensed Conveyancer

Patent & Trade Mark Attorney

CONSUMER CHOICE

Unbundled services

Mediator Pro bono support

Voluntary sector

McKenzie friend

Online help

Source: Bar Standards Board (2016) Core database; Legal Services Consumer Panel (2014) 2020 Legal Services How regulators should prepare for the future

We refer to the supply-side of the part of the market that we regulate as “the Bar”. This includes selfemployed barristers, employed barristers, some registered European lawyers, specialist legal firms authorised by us and people who own, manage and work in those firms, as well as unregistered barristers who have been called to the Bar but do not practise as a barrister. A barrister is a person who has been called to the Bar by an Inn of Court. Where we are referring specifically to barristers in this document, this will be explicit.

There are also many in the sector working alongside legal professionals to deliver legal services. At the Bar for example, clerking staff and chambers management play a significant role. Specialist organisations provide services such as case management software, IT support, accounting services, professional indemnity insurance, recruitment and training for legal professionals.


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Demand: There are many different individuals and organisations who use, or may require, legal services. The main client types could be grouped as below. But it is not only those who already have a lawyer who are our concern. Any individual or organisation may have a legal need, and there are further groups specifically impacted by the work of lawyers who fall within the statutory definition of “consumers” in the Legal Services Act – for example, victims or witnesses.3 We also consider other parties affected by the work of those we regulate, such as instructing

solicitors (“professional clients” in the context of the Bar), opposing counsel and members of the judiciary who rely on the Bar to assist them ably in the effective administration of justice. Our Risk Outlook considers all of these groups where they are relevant. We do not believe we can be fully effective as a regulator if we fail to understand the world around us. We risk failure if we do not adequately take account of significant changes taking place in the wider legal sector, or if we think about our role in isolation from the many others involved in overseeing, delivering or using legal services in England and Wales.

Types of consumers of legal services

Publicly funded and pro bono

Private clients

Small and medium-sized enterprises (SME)

Large organisations

Source: Oxera/ Legal Services Board (2011) A Framework to monitor the legal services sector

3

See Legal Services Act 2007, s.207

Government


Market context This section explores the current landscape in which the Bar operates. It considers the nature of the law, experiences of consumers, structural change in the legal sector and external factors impacting delivery of, and demand for, legal services. The market in 2016 is changing rapidly and the longterm success of that market in meeting the needs of consumers will be determined primarily by how the Bar and other legal professionals respond. This is why we have dedicated a whole section of our Risk Outlook to market context. This sets the backdrop for our three risk themes which follow. This chapter explores the market context under the following headings:

• Legal System – aspects of the law and legal services

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Legal System In this section, we explore some attributes of legal services and the law that influence how effectively the market is operating to meet the needs of those who rely on the legal system.

The market for legal services is fundamental to the rule of law and access to justice; these are the bedrock of a democratic and fair society

In brief

• Effective legal services are important to society beyond those directly involved.

• Unmet need for legal services can undermine access to justice and the rule of law.

• Public trust in barristers and other lawyers is important for the legal system as a whole.

that define the nature of the legal services market;

• Client experience and choice – the expectations of

clients and the range of providers from which they may choose;

• Structural changes in the sector – including

regulatory and other systemic changes in the administration of justice; and,

• External factors – wider aspects including

economic, political, social and technological developments that affect both providers and consumers in the market.

The legal system plays a crucial role in society, and poor legal decisions or a poorly functioning court system can have an impact well beyond any individual case. When legal services do not operate effectively this can undermine the public interest and make society less fair and just. All of us have a collective stake in the rule of law and in society achieving the appropriate balance of rights and responsibilities. The impact of legal services on the public (current and future citizens) may be felt in terms of security, wellbeing or participation in society.4 There is also a financial impact given the importance of a well-functioning legal system for the global economy and UK plc. There is evidence that many legal issues and disputes remain unresolved because those involved are unable to obtain legal advice or representation due to cost,

4

Stephen Mayson, Legal Services Institute (2011, revised 2013) Legal services regulation and ‘the public interest’


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or a lack of knowledge and confidence in how to obtain it.5 This is particularly true amongst “socially excluded” groups, even though they are more likely to experience situations requiring a legal solution.6 If people cannot access legal advice because of cost or other barriers, they may not be able to obtain justice. This represents a significant challenge for the legal services sector. Unmet need, and its disproportionate impact on certain groups, can cause some sections of the public to feel that the legal system does not operate in their best interests. This can undermine public trust in the legal profession, which the Legal Services Consumer Panel found is lower than for some other professions (see infographic on page 15).7 A recent study found that many feel their rights will not be protected if they make use of legal services, and that the legal sector is not fair or transparent.8 Another found that existing levels of trust in the legal profession are already damaging both to providers of legal services and to the wider public.9 Barristers have an overriding duty to the court to act with independence in the interests of justice. This duty to the court reflects the wider impact of any legal decisions beyond just the parties involved and the need to avoid miscarriages of justice. It is a particularly important aspect of the Bar’s regulatory regime. Barristers’ duty to act in the best interests of each client is subject to that wider duty to the court. The ethical decisions required of legal professionals can be complex, and the results of poor decisions can affect public trust in the profession and the administration of justice more generally.

5 Legal Services Commission (2010) Report of the 2006-2009 English and Welsh Civil and Social Justice Survey; Legal Services Research Centre (2010) Knowledge, capability and experience of rights problems; Legal Services Board (2014) How People Resolve ‘Legal’ Problems 6 Buck et al. (2005) Social Exclusion and Civil Law: Experience of Civil Justice Problems among Vulnerable Groups 7 Legal Services Consumer Panel (2015) Tracker Survey 8 Hodge, Jones & Allen (2015) UK Perceptions of the Legal and Justice System 9 Respublica (2015) In Professions We Trust

Many people requiring legal services can be in vulnerable situations

In brief

• Many using legal services are already in a

vulnerable position, and can have characteristics which put them further at risk of detriment.

• These characteristics can be short-term or

long-term, can change over time and have a cumulative effect.

• Vulnerable consumers may have support needs which are poorly addressed by legal service providers.

Many seeking legal services will be doing so in very difficult circumstances, and in response to potentially life-changing events. In these circumstances, consumers are already in a vulnerable situation where they can be particularly at risk of loss or harm. Those who are feeling stressed or vulnerable may be less able to make good decisions about their legal situation. This in turn may have an impact on the outcome of their legal case; and the consequences for individuals can be severe. Consumers can also feel intimidated by legal professionals and the process of purchasing legal services.10 This can also contribute to them not making a complaint when they are dissatisfied with the service they have received.11

10 Solicitors Regulation Authority (2010) Research on Consumers’ Attitudes towards the Purchase of Legal Services 11 Legal Ombudsman (2012) Consumer experiences of complaint handling in the legal services market


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Some legal consumers will be facing particular vulnerabilities, which could relate to a wide range of situations or individual characteristics, such as:12

Consumer vulnerability Age

Lone parent

Health problems

Inexperience

Loss of income

Being a carer

Learning disabilities

Living alone

Leaving care

Physical disabilities

Low income

Bereavement

English as a second language

Low literacy

Relationship breakdown

Location

Cultural barriers

Release from prison

Lack of internet access

Mental health issues

Such individuals can face additional barriers to accessing legal services or to obtaining an appropriate service. Past research projects have suggested that (for example) consumers with learning disabilities,13 hearing impairment,14 or young defendants or witnesses15 have support needs that are often poorly addressed by legal service providers. Other research also suggests that individuals with one or more “vulnerabilities” report higher numbers of civil justice problems on average [than those without any “vulnerabilities”].16

12 Legal Services Consumer Panel (2014) Recognising and Responding to Consumer Vulnerability 13 Legal Services Consumer Panel (2013) What happens when people with learning disabilities need advice about the law? 14 Kyle et al. (2012) Legal Choices – Silent Process 15 Institute for Criminal Policy Research for the BSB (2015) Youth Proceedings Advocacy Review 16 Legal Services Commission (2010) Report of the 2006-2009 English and Welsh Civil and Social Justice Survey

For many facing legal problems, their vulnerability is the very cause of needing that legal help in the first place. Some of the most common causes of civil justice problems include loss of income, stress related ill-health and “not knowing my or someone else’s rights”.17 Consumer vulnerabilities can be short-term or longterm, and may change over time. Not all of the risk factors listed will consistently affect access to legal services. One factor on its own may not create barriers to access, but in combination with other factors could place a legal consumer in a vulnerable position.

17 Legal Services Commission (2013) Summary Findings of Wave 2 of the English and Welsh Civil and Social Justice Panel Survey


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The complexity of the system and the limited legal capability of consumers

In brief

• The legal system is complex and continually changing.

• There are generally low levels of legal capability

among the public. This affects a person’s ability to deal with law-related problems and can make it difficult for people to appreciate the complexity of the law.

• A lack of understanding of their rights and of legal services is a particular problem for some groups and with certain legal issues.

• Public legal education is one way of building legal capability to help consumers understand and interact with the legal system.

The complexity of the legal system requires practitioners to keep up to date with developments in technical areas of the law. The pace of statutory change varies across the different areas of law. Immigration is one example of an area of law that changes rapidly and has complex rules that interact with other areas of law, such as human rights, employment, housing etc. The complexity is magnified by the significant impact that poor advice or decisions can have on a potentially vulnerable client group. Where the area of law is complex, the language, procedure and protocols required to apply it in specific circumstances often become more challenging for consumers. They can be confronted with different courts, different types of lawyers, and different processes, all of which make using the system harder for consumers.

So the law itself and the legal system in England and Wales can be hard for many consumers to understand. This is compounded by the fact that for many people, legal services are an infrequent and/or distress purchase (a purchase made following an event or situation which may have harmed a consumer or placed them under significant distress such as an accident or divorce). It is difficult for inexperienced, often vulnerable, consumers to know who to turn to for advice and/or representation. “The idea that individuals are capable of handling civil justice problems without professional advice, anticipates a level of existing competence from the population”18 that often is not there. This can worsen any legal problems they face19 and affect their willingness to engage with legal services in the first place.20 The urgent and stressful nature of many legal problems means that consumers may find it difficult to research their options in an objective and thorough manner. This can increase the imbalance in knowledge and understanding of the law between a provider and their client. The growth of alternative (including unregulated) providers has increased choice, though many consumers struggle to tell the difference between providers, especially regulated and unregulated ones (this is explored further in theme three on page 61). A lack of knowledge of their rights and a lack of understanding of legal services is more common among disadvantaged or vulnerable groups and around certain legal issues.21 This can lead to further disadvantage when people from these groups require legal services.

18 Denvir et al. (2013) When legal rights are not a reality: do individuals know their rights and how can we tell?, The Journal of Social Welfare and Family Law, 35:1, 139-160 19 The source here is the same as the previous footnote. For the rest of this document we will use the term ‘ibid.’ to state this. 20 Legal Services Board (2012) Understanding consumer needs from legal information sources 21 Legal Services Research Centre (2010) Knowledge, capability and experience of rights problems


Alongside the complexity of the legal system, most members of the public also have low levels of legal capability. Law for Life, a legal education and information charity, has defined this as “the abilities that a person needs to deal effectively with lawrelated issues”.22 This covers the knowledge, skills and attitudes needed by a consumer to identify and subsequently resolve a legal problem they are facing – so going beyond knowledge of the law, to include capabilities such as communication skills, confidence and determination. Their studies have found that “only 59% of people were able to demonstrate some understanding of their rights” and “only 25% of people claim to know their legal position completely when they experience a legal problem”. They also found that the “majority of people feel confident that they can achieve a fair resolution to a problem” until they realise they have encountered a legal problem. At this point, “levels of confidence [reduce] significantly”.23

23

There are initiatives to build public legal capability, though work is still largely undertaken by a couple of specialist charities. Activity is driven in part by the rise in unrepresented parties in the legal system, with a co-ordinated support strategy for litigants in person bringing together several agencies to provide easy to understand advice for members of the public.27 The Law Society has produced a toolkit for partners and corporate social responsibility professionals interested in building public legal capability.28

Analysis of a previous English and Welsh Civil and Social Justice Survey made similar findings. For example, “out of the five thousand people who took part, only 38% said they knew their legal rights and 69% did not know anything about formal legal processes”.24 More recent findings showed that when faced with legal problems, 31% of respondents felt they did not understand their rights at all. Just 11% were able to correctly identify problems as being legal in nature.25 When the public has low levels of legal capability, individual consumers are unlikely to appreciate the complexity of the law in respect of their particular problem. Work by the Legal Services Consumer Panel found that there is a “common belief that the law is relatively black and white in some areas”. 26

22 ibid. 23 Law for Life (2015) Legal Needs, Legal Capability and the Role of Public Legal Education 24 Legal Services Research Centre (2007) Annexe to the PLEAS Task Force Report: Education Implications from the English and Welsh Civil and Social Justice Survey 25 Legal Services Commission (2013) Summary Findings of Wave 2 of the English and Welsh Civil and Social Justice Panel Survey 26 Legal Services Consumer Panel (2010) Quality in Legal Services

27 Available at http://www.advicenow.org.uk 28 The Law Society (2016) Developing a public legal education programme: guidance and toolkit


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Affordability and value of legal advice

In brief

• Legal services are often either too expensive, or perceived to be too expensive, for consumers.

• Reductions in legal aid have increased the

number of consumers with legal problems who cannot afford advice.

• For those who can pay for legal advice, there are a number of ways to do so.

• Consumers struggle to judge the quality of

legal advice and representation which makes it particularly difficult to judge the value offered by different providers.

Legal services are too expensive for many consumers. In the words of the Lord Chief Justice, “…our justice system has become unaffordable to most”.29 In addition, other consumers, who may actually be able to afford legal services, are put off from seeking advice because they perceive that it will be too expensive. Many consumers lack sufficient information to make confident, informed decisions about the value and affordability of legal services. Legal aid has long been a way of making sure that legal advice is accessible to those who otherwise might be unable to afford it for certain legal problems.30 Recent cuts in the amount of legal aid available, and associated changes to the way in which it is allocated, have resulted in larger numbers of consumers unable to afford legal advice or representation in court. For example, in private family law cases, the Ministry of Justice found that the majority of litigants in person 29 Judicial Office (2016) Lord Chief Justice’s Report 2015 30 Article 14, paragraph 3 (d) of the International Covenant on Civil and Political Rights states that everyone is entitled to “have legal assistance assigned to him in any case where the interests of justice so require, and without payment by him in any such case if he does not have sufficient means to pay for it.”

were in that position “because they were ineligible for or had been unable to obtain legal aid, but could not afford legal representation”.31 One survey found that 63% of the public do not believe professional legal advice is an affordable option for ordinary people.32 Other research by the Legal Services Board suggests that “perceived high costs is [one of the] main barriers to accessing legal services for small businesses”. 33 For those who can afford legal advice, providers do offer some different ways to pay. These include “no win, no fee” (or “no win, discounted fee”) arrangements such as conditional fee agreements, fees that are fixed regardless of the time spent by the provider, bulk payments for an agreed amount of work and standard hourly rates. It appears that the introduction of damages-based agreements in the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO), another form of “no win, no fee” arrangement, has perhaps not widened consumer financing options as hoped. A Bar Council report found that one year on from LASPO, only 3% of barristers had used a damages-based agreement.34 Unbundling can also be a way to reduce the cost of legal advice. This involves separating “a package of legal services into parts or tasks”.35 The consumer and provider then agree which parts the provider will do, with the consumer doing the rest.

31 Ministry of Justice (2014) Litigants in person in private family law cases 32 Hodge, Jones & Allen (2015) UK Perceptions of the Legal and Justice System 33 Legal Services Board (2016) Cost of Services 34 The Bar Council (2014) The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO): One Year On 35 Legal Services Consumer Panel (2015) Qualitative research exploring experiences and perceptions of unbundled legal services


Alongside the perception of affordability, many consumers struggle to judge the quality of legal advice. The Legal Services Consumer Panel found five reasons for this:36

• Seeking legal advice is an infrequent event for some consumers;

• Consumers felt they had limited legal capability and as such may not understand the intracacies of their problem and how the law applies to it;

• The value of legal advice can sometimes become apparent in the long term, rather than the short term;

• There is minimal information – outside of the

consumer’s engagement with their lawyer – to help them assess the suitability and value of the advice they are receiving; and

• Consumers are relatively passive and unlikely to

compare different lawyers before obtaining legal advice.

As a result of this, many consumers judge the quality of the advice largely on the customer service they have received or the outcome of their case. They assume all lawyers have an acceptable level of legal knowledge and are not able to evaluate the technical accuracy of the advice given.37

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Client experience and choice Service expectations

In brief

• Demand for legal services is changing. Some

consumers are looking for providers to provide services in more flexible ways, such as working directly for clients and/or being instructed on a more limited basis allowing consumers to tackle other elements themselves.

• Adjusting to clients’ changing expectations can

pose challenges for providers, particularly around adoption of (and investment in) new technologies.

• There are demands for greater transparency,

flexibility, and clarity around cost and quality.

Clients increasingly expect transparency, responsiveness, convenience and flexibility in the delivery of legal services.38 This reflects changes in the way other professions and service providers interact with consumers, particularly driven by adoption of technology to support delivery of services.

The Competition and Markets Authority has, at the time of writing, announced a study into “longstanding concerns about the affordability of legal services and standards of service”. This will explore areas such as whether consumers can make informed purchasing decisions, whether they are adequately protected if things go wrong and if regulation and the regulatory framework impacts on competition between providers.

For the Bar, past studies have suggested a gradual increase in demand from consumers seeking to instruct barristers on a public access basis.39 We are undertaking further research on this, due for publication in mid-2016. The combination of unbundling and public access could allow consumers to minimise the cost of legal services considerably. First, they would not need a professional intermediary and second, they could receive advice only on the parts of a case they are not confident in handling themselves. The Bar may need to deal directly with members of the public more often, and change their ways of working in order to meet the changing expectations of their clients. To help with this, they are required to complete public access training.

36 Legal Services Consumer Panel (2010) Quality in Legal Services 37 ibid.

38 LexisNexis (2015) The Age of the Client: Bellwether Report 39 Robins (2010) Direct Access to Barristers


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Providers will also need to consider changes necessary to the way in which they offer services and in particular the support available to clients. This may include greater transparency or clarity around barristers’ fees or greater administrative support for clients. Practices like charging by the hour rather than fixed fees can deter clients who have limited funds available, and there is limited information available even to enable comparison of hourly rates at present. The Legal Services Board is currently exploring this. Its research, due to be published in 2016, aims to “develop a robust methodology for understanding the prices paid for some key legal services commonly purchased by consumers”.40 Consumers often lack the experience or knowledge to judge the quality of legal service they have received – instead, they may judge based on the outcome of their case (ie whether they “won” or not) or on some other factor often relating to customer service and communication.41 Consumers’ reliance upon word of mouth when faced with legal problems means that perceptions will be spread through family, social and community relationships. Failure to understand what is important to clients and to deliver legal services in a way which clients find accessible and which builds their confidence in the legal process can have a detrimental impact beyond “customer satisfaction” levels. Public confidence that the legal system works effectively in the interests of justice is an important aspect of maintaining the wider rule of law.

Availability of alternative providers

In brief

• The wide range of providers and unreserved legal activities is blurring the divide between different types of lawyer and other providers.

• Whilst reserved legal activities can still only be

undertaken by those authorised under the Legal Services Act 2007, much legal work is unreserved and can be provided by regulated lawyers, other professionals or other types of provider altogether with often fewer or no regulatory restrictions.

• Many charities and organisations will help

consumers to navigate the legal system without a lawyer, increasingly supported also by the courts and judiciary. Many newer providers are taking advantage of technology to enable new ways of delivering legal services.

• Consumers have an expectation that all legal

providers will be regulated. The breadth of options available can make choosing the most appropriate provider, with the appropriate level of regulatory protections, particularly challenging.

There are a wide range of providers offering legal services. Those who provide reserved legal activities need to be authorised and regulated under the framework set out in the Legal Services Act 2007. These activities are:

• exercising rights of audience; • conducting litigation; • reserved instrument activities (activities related to conveyancing);

40 Legal Services Board (2015) Understanding changes in prices of legal services 41 Legal Services Consumer Panel (2010) Quality in Legal Services

• probate activities; • notarial activities; and • administering oaths.


Providers often specialise in one or two of these areas, though some provide a wider range of services. Barristers are traditionally known for advocacy and their role in courts, though much work takes place outside court and focuses on specialist advice as well. More recently barristers have also been able to apply to conduct litigation (previously the reserve of solicitors), and solicitors have been able to apply for permission to exercise higher rights of audience in the higher courts since the 1990s. Unreserved legal activities are not restricted in the same way. Many regulated providers offer unreserved legal work (such as corporate work or tax advice) and compete with those under different regulatory regimes or in some cases, providers who are not regulated. For example, tax law and company law are examples where both barristers and accountants have significant expertise and can compete with each other. Lines are becoming further blurred as accountants, for example, can also apply to be regulated specifically as a legal services business. Unregulated providers may be able to offer more affordable services because they do not have to pay for the direct costs of being regulated and the indirect costs of complying with the regulator’s rules and requirements. This impacts on competition to an extent, but it could be argued that a significant portion of unregulated providers are not taking work away from lawyers but catering for otherwise unmet legal need. Some regulators have responded by offering greater flexibility to providers. For example, we have enabled barristers to deliver legal services direct to the public and through entities. This enables them to have a wider range of businesses models. Alternative business structures (ABS, which permit non-lawyer or external ownership of law firms) and multi-disciplinary practices (combining delivery of legal services with other areas of business activity), have also been introduced by some legal regulators, including one accountancy body. The LSB has recently agreed to recommend that the Lord Chancellor designates the

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Bar Council, acting through the BSB, as a regulator of ABS. This will offer the Bar more flexibility to innovate and compete to better meet consumer needs. There is a need to educate consumers that only some of the providers of legal services are regulated and/or covered by the Ombudsman scheme. Research by the Solicitors Regulation Authority found that interviewees had a “general expectation that all providers within the sector would be regulated (in parallel with other sectors)”.42 Finally, there are charities that provide legal services at little or no cost to consumers and providers that enable or support consumers who navigate the legal system without a lawyer. McKenzie friends are a good example of the latter. These individuals are not required to be legally qualified and will help consumers through the court process. They can provide moral support, take notes, assist with case papers and quietly give advice on any aspect of the conduct of the case.43 While these groups may not directly compete with regulated providers, they may impact on the development of the market. The wide range of providers, and the response by regulators, is continuing to blur the divide between different types of lawyer and other professions or unregulated providers. While this should lead to more providers being in direct competition with each other, which in turn increases choice, it also adds to the complexity faced by consumers.

42 Solicitors Regulation Authority (2010) Research on Consumer’s Attitudes towards the Purchase of Legal Services 43 In line with practice guidance on McKenzie friends provided by the Courts and Tribunals Judiciary, Available at: https://www.judiciary. gov.uk/publications/mckenzie-friends/


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Structural changes within the sector Regulatory change

In brief

• Several changes to legal services regulation

have been introduced by us and the other legal regulators over recent years.

• These are focused on encouraging flexibility, innovation and new business models.

• Changes to regulation can provide flexibility for

the Bar but can also add to the cost of regulation in the short term and create uncertainty in the market.

• Adjusting to change provides both opportunities and challenges for the Bar.

The regulation of legal services is undergoing a sustained period of considerable change. Factors driving this include:

• Concerns about the extent to which the current

structures inhibit the development of competition. This is the subject of a specific market study by the Competition and Markets Authority, but is a theme that the legal regulators and the LSB are concerned about in any event;

• The Regulators’ Code

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and other initiatives that seek to promote a risk-based approach that minimises regulatory burdens and promotes innovation in the sector;

• The LSB’s Regulatory Standards Framework,

adopted by the BSB, which requires us to be riskbased and outcomes-focused in everything that we do; and

• Our programme to re-shape the future of legal

education and training for the Bar (Future Bar Training). The Solicitors Regulation Authority is undertaking a similar exercise for solicitors.

As discussed above, several reforms have been introduced to encourage flexibility, innovation and new business models in the market to meet consumer needs better. These include allowing the Bar to provide services directly to the public and also via a range of different business models. The changes to regulation provide additional flexibility for the Bar to meet clients’ needs in new ways. This allows the Bar to compete with a larger section of the market. However, in the short term, these changes could add to the burden of regulation. They may need to adjust their processes, policies or systems to accommodate new approaches, for example.

• Concerns that the legal regulators are not

sufficiently independent of the professional and representative bodies who are “Approved Regulators” under the Legal Services Act (this is soon likely to be the subject of consultation by the Ministry of Justice);

44 The Department for Business, Innovation & Skills (2014) The Regulators’ Code


Changes in the justice system, eg Court reform

In brief

• Court closures could lead to greater travel and

time demands on clients and members of the Bar.

• Technological reform in the courts could mean the Bar needs to invest in new technology or improve their technological expertise.

• Changes to court fees may change demand for the Bar’s services.

Our Criminal and Civil Courts are entering a period of major transformation, with the proposed Online Court, online dispute resolution and fundamental redesign of the court system with users placed at the centre. This has the potential to be a much-needed modernisation, which can have positive benefits for access to justice. Making the justice system more user-friendly has the potential to assist those who wish to represent themselves without a lawyer and to enable legal services providers to serve their clients more effectively. More flexible hours, increased use of technology and streamlined procedures can all have a positive impact. Adapting to changes in use of technology will be important for the Bar. At a more practical level, further court closures could (if not offset by technological improvements) have an impact on access to justice for some, resulting in additional travel requirements for clients and their legal advisers. The Law Society’s research found that following the court closures, those attending court via public transport may struggle to make the journey in an hour or less, increasing the possibility of delays and disruption.45 This could, in turn, further impact on the publicly funded Bar – that tends to rely on high numbers of lower-income cases – or other barristers operating on a fixed-fee basis. We have also heard that this increases the difficulty in making time to meet 45 The Law Society (2015) Proposal on the provision of court and tribunal estate in England and Wales: The Law Society Response

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clients face to face in advance of hearings, for example for immigration hearings which take place regionally. The introduction of new technology-based solutions poses both opportunities and challenges for the Bar and its clients. The introduction of significant technological reform of court proceedings could lead to greater efficiency in the provision of legal services if technological solutions can be effectively deployed. However, the changes in working practices required by such developments may lead to a number of risks to the delivery of legal services. Greater expectation around technical competence could place additional burdens on the Bar, particularly if clients are unable to access the required technology. This is likely to lead to an increasing need for investment in new technology and training for any members of the Bar who have not already adopted more modern technologies. With this may come an increased potential for data security issues to arise. These changes could also lead to a reduction in face to face legal service offerings, which past research found to be the preference for the majority of clients.46 However, where a consumer and provider are unable to meet, technology-based solutions such as the facility to “live chat” (an online exchange of written messages in real time) are found to have higher satisfaction levels than phone and email alternatives.47 Providers who balance face to face and online services may find they can serve a wider pool of consumers with more flexibility and greater customer satisfaction. Another aspect of court reform likely to impact on consumers and the Bar is changes to court fees. These may discourage or prevent some consumers from seeking legal advice or representation, thus reducing demand for certain legal services (particularly publicly funded services) and leading to an increase in the number of legal problems going unaddressed. See 46 YouGov (2010) Shopping Around: What consumers want from the new legal services market 47 The eDigital Customer Service Benchmark found 71% of customers were satisfied with live chat, as compared to 61% for email and 44% for phone. See https://www.maruedr.com/ live-chat-tops-customer-service-league-table-thanks-to-highsatisfaction-and-low-customer-effort/


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page 60 for more on this in our third risk theme. These shifts may also lead to increased demand for alternative approaches to legal problems, such as unbundled services or Alternative Dispute Resolution, or contribute to the increase in litigants in person.

External Factors Technological development

In brief

• Technological developments are bringing many

positive opportunities for consumers and for the Bar.

• Increasing adoption of technology could leave

some consumers behind and have an impact on the wellbeing of those who rely heavily upon it.

• Data security is a particular area of concern, as the Bar increasingly works directly with clients and is expanding its use of digital communication.

• Increasing use of technology may create gaps in regulation, posing risks for clients.

Technological change is likely to affect the behaviour of consumers and the way in which members of the Bar operate. This presents both opportunities (eg automation, easier communication) and risk (eg cyber-security) for the future development of legal services. New online methods for delivering legal services could improve access to justice for some consumers. The Online Dispute Resolution Advisory Group believes that supporting people to resolve disputes over the internet, even where matters may require a judge, is one means of doing this. They are seeking “not just to have better methods of resolving disputes but also to have effective ways of avoiding and containing disputes”.48 However, as the Legal Services Consumer Panel report on empowering consumers outlines, “whilst the internet is a cost-effective means of delivering information rapidly to a wide audience, legal regulators should be aware of digital inclusion 48 Online Dispute Resolution Advisory Group, Civil Justice Council (2015) Online dispute resolution for low value civil claims


challenges”.49 The interim Civil Courts Structure Review report suggests that, among current litigants in person, over 50% could “find the use or even ownership of computers challenging”.50 It is therefore important that technology in the legal system is “designed to ensure that [those who find it difficult to conduct civil litigation through a computer] suffer no impairment in their access to justice”. The report suggests that “telephone help-lines and face to face human help” are also being considered. The increasing expectation from clients that lawyers are always connected, including outside standard office hours,51 risks affecting the work-life balance and wellbeing of the profession. This may have knock on consequences for consumers in terms of the quality of service provided by members of the Bar. Our supervision of chambers has found that “dedicated IT resources and specialist information risk management expertise are rarely found within chambers themselves”.52 This is partly a result of the structure of the Bar, with the relatively small size of many chambers. Dependency on third parties as providers of technological services rather than the use of in-house expertise leads to third party supplier risks, particularly given that certain large-scale providers often dominate the market providing information technology services to the Bar. Data security is a particular source of concern solicitors have already fallen victim to a range of IT threats and cyber-attacks53 and the Bar could become equally vulnerable too. It is imperative that barristers protect and preserve the confidentiality of their clients’ information and affairs. The Bar Council has recently provided information to help the Bar to do this.54 The 49 Legal Services Consumer Panel (2013) Empowering Consumers Report 50 Lord Justice Briggs (2015) Civil Courts Structure Review: Interim Report 51 LexisNexis (2015) The Age of the Client: Bellwether Report 52 Bar Standards Board (2015) Report on High Impact Supervision Returns 53 Solicitors Regulation Authority (2014) Spiders in the Web – the risks of online crime to legal business 54 Bar Council (2016) Information Security, Available at: http://www. barcouncil.org.uk/media/414748/information_security.pdf

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growing use of electronic communication at the Bar represents a clear data security threat if the risks are poorly managed. The Information Commissioner’s Office has previously issued a warning to the legal profession relating to “troubling” reports of data breaches.55 This highlights the need for the Bar to keep on top of data security in order to protect client data and to avoid potentially high fines. We are currently undertaking a research project on different ways that barristers are now delivering services. We believe there are a growing number of chambers operating exclusively online. This innovation provides new ways of working and providing services. However, it also presents new challenges for regulation. Developments in artificial intelligence bring the potential for significant disruption to traditional models for legal services in the future. Artificial intelligence can be defined in a number of ways, but the majority centre around use of computers to obtain large amounts of data, learn from that data and use it to make informed decisions in a similar way to humans. There are products currently being used, such as IBM Watson,56 which are sometimes termed “augmented intelligence”. Rather than seeking to replace human decision-makers, these systems obtain and learn from data so that they can enhance users’ capabilities to answer specific questions and they provide analysis to support decision making. Products like this are expected to transform tasks like legal research, giving providers an advanced analytical tool that lets them invest more time in working with, and representing, clients. Companies are already developing this technology for application specifically within the legal sector to support legal research work by 55 Information Commissioner’s Office (2014) Information Commissioner ‘sounds the alarm’ on data breaches within the legal profession 56 IBM Watson is a technology platform that uses natural language processing and machine learning to reveal insights from large amounts of unstructured data. More information can be found on IBM’s website


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searching large volumes of documents for relevant information.57 If the Bar fails to adapt to modern technology successfully it risks being left behind as new providers enter the market which may be better positioned to cater to the needs of clients and to do so more efficiently and perhaps cost-effectively.

Globalisation

In brief

• International legal work is valuable both for the Bar and the wider UK economy.

• Overseeing how barristers operate abroad is

challenging for regulators. This may put clients at risk and damage the Bar’s reputation.

• Other jurisdictions may consider individuals

who have been called to the English and Welsh Bar, but who have not completed pupillage, as qualified to be a barrister.

The international reputation of the legal system in England and Wales means that the Bar is increasingly providing services internationally. Estimates put the total value of legal exports at over £3 billion, with their proportion of the legal services market increasing year on year.58 For the England and Wales Bar specifically, latest figures show that in 2014 1,489 self-employed barristers received instructions from clients based overseas. This led to “30% of the overall increase in the self-employed Bar’s earnings [coming] from international work”.59 The international market for legal services provides considerable benefit to legal practitioners and to the wider UK economy. Barristers working overseas or undertaking international work within England and Wales are often trading on the reputation of the English and Welsh Bar, and the English and Welsh legal system more generally. Regulatory oversight of barristers operating abroad is more difficult, which may put their clients at risk with few options for redress. This could damage the reputation of the Bar (and thereby confidence in the legal system of England and Wales more generally) both at home and abroad.

57 For example, a product called ROSS Intelligence

58 Law Society (2014) Forecasts of legal services sector real turnover and net exports 59 Chantal-Aimée Doerries contributing for Counsel magazine (2016) A Bar without borders


In addition, we know that there is a cohort of BPTC students each year who intend to return overseas following their studies. Whilst we require individuals to complete pupillage in order to practise as a barrister, other jurisdictions do not necessarily apply equivalent requirements of those called to the Bar of England & Wales.

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Political and economic considerations

In brief

• The legal sector as a whole is affected by wider economic trends such as low growth.

• Political developments such as funding cuts

and legislative reform can significantly affect the provision of legal services and the viability of certain areas of work.

• The upcoming EU referendum could cause considerable uncertainty and affect on the legal sector.

Economic developments influence both the provision of legal services and the behaviour of consumers. The legal services market is an important sector of the wider UK economy – estimates suggest that it has a total value (gross value added)of £25.7 billion annually60 and employs over 300,000 people.61 Inevitably, the legal services sector is vulnerable to national and international economic trends. Consumers and providers continue to experience a general climate of low growth. This can affect the demand for and use of legal services. Political developments can also affect legal service provision. The current government’s spending cuts across a range of areas include reductions in funding that directly impact the Bar (legal aid funding being a high-profile example). Reductions in funding can also indirectly influence the legal sector, for example by reducing funding for voluntary services that signpost and direct consumers to appropriate legal provision. A report by the Low Commission suggests that the reduction in local authority funding of advice and legal support is estimated to be at least £40m per annum by 2015.62 60 The Law Society (2016) Economic value of the legal services sector 61 TheCityUK (2015) UK Legal Services 2015 62 The Low Commission (2014) Tackling the Advice Deficit: A strategy for access to advice and legal support on social welfare law in England and Wales

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The forthcoming referendum on UK membership of the European Union could also have significant effects on the legal services sector, with Law Society research predicting that a UK exit could slow down growth in the legal services sector.63 We now turn in Part II of the Outlook to explore our three priority risk themes.

63 The Law Society (2015) The UK Legal Services Sector and the EU


Part II Priority risk themes

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Part II Priority risk themes Theme A Failure to meet consumer need This theme concerns areas in which the legal services market may be failing adequately to meet the needs of those who require legal help. We see indicators of rising levels of unmet legal need, and what consumers expect from the legal services market continues to change. We want to understand this better and help the profession we regulate to respond. We explored the varying types of consumer in the opening section of Part I (see page 18). Throughout this theme (unless otherwise specified) we focus on individual clients, especially those who are vulnerable. We are looking to broaden this in future work to explore the needs of small and mediumsized enterprises (SMEs) to understand better their experiences of legal services: research from 2015 indicates that only 13% of SMEs viewed lawyers as cost effective.64

Theme A in brief

• The needs and rights of consumers and the

public go to the heart of our regulatory objectives.

• Individual vulnerability, legal complexity, legal aid reduction and a lack of general understanding of the role of legal services potentially prevent access to justice.

• For those who do obtain legal advice, they can

sometimes receive poor service or inadequate advice and may view the advice as poor value for money.

• Obtaining redress when things go wrong can be

difficult for consumers. There are many routes to take, depending on what has gone wrong.

• We are keen to develop better our understanding of the interaction between consumers and providers of legal services.

• The profession needs to continue to develop its understanding of the consumers it serves.

Why we think this matters The regulatory objectives within the Legal Services Act 2007 clearly set out our responsibility, alongside the other legal regulators, to improve access to justice, to protect the interests of consumers and to encourage strong and effective legal services providers. The right of the public to obtain an appropriate remedy through the justice system if they have not been treated fairly is fundamental to maintaining a fair and democratic society. 64 Legal Services Board (2015) The legal needs of small businesses: An analysis of small businesses’ experience of legal problems, capacity and attitudes


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This applies to everyone, whether they are individuals, small to medium-sized enterprises, large international corporations or government bodies. Legal consumers may be in uncertain and lifechanging situations when they are approaching the legal services sector for help. Consumers who are vulnerable may feel additional fear and stress in such situations. Ultimately, this could lead to them deciding not even to approach lawyers for assistance in the first place. This section looks at what may hinder consumer needs being met. The risks from our Regulatory Risk Index associated with this theme are: 1.1 Failure to provide a proper standard of service 3.3 Lack of cultural competence and people skills 5.1 Failure to meet consumer demand 5.3 Poor public perception of legal services 5.4 Affordability or value concerns

The kind of market we want to see We want to see a market where:

• providers offer good value to consumers; • consumers have enough information to be able to make an informed decision about when they need legal help and where to go to get it;

• consumers understand the protections afforded

to them as a result of choosing a regulated lawyer – protections they are able to draw on easily when required;

• providers can anticipate and respond to changing consumer needs; and

• all providers are trained to identify consumers who

are vulnerable, whether because of their immediate situation or because of long-term characteristics. Once identified, additional support and reasonable adjustments are provided to accommodate that particular consumer’s needs in a way that does not pose a barrier to access to justice. This would apply to the entire court system.

Background Consumer vulnerability Anyone, including an organisation, with a legal problem is potentially susceptible to loss or harm. In addition, many legal issues arise through some of the most difficult life events, such as illness, bereavement, detention or family breakdown. The process of seeking and engaging legal assistance can present further challenges. There are a range of individual factors that can increase vulnerability.65 There are a number of physical, emotional and environmental factors that can disadvantage individuals, outlined in Part I on page 21. For people with one or more vulnerabilities, their experience as a legal consumer can be considerably affected. A report for the Legal Services Board found that “where there are deficiencies in the civil justice system, they are attributable largely to the difficulty of enabling vulnerable populations with limited capability and resources to access appropriate help in a complex market”.66 65 Legal Services Consumer Panel (2014) Recognising and Responding to Consumer Vulnerability 66 Legal Services Board (2014) How People Resolve ‘Legal’ Problems


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It is not just individuals’ characteristics and situations which contribute to vulnerability, but features of the market too. These include the availability of information to help consumers make a choice. Consumer vulnerabilities are explored below as we start to look at the four stages of the “consumer journey” that consumers will typically go through when accessing the legal services market.

Understanding consumer needs An individual or organisation with a legal problem will go through several different stages in identifying and responding to that legal need. Whilst every consumer’s experience will be individual to their circumstances, we can characterise this in general terms using a simple four stage model (we will refer to this as the “consumer journey”).

The four stages of the consumer journey

STAGE 1

STAGE 2

STAGE 3

STAGE 4

IDENTIFYING

CHOOSING

RECEIVING

FOLLOW-UP

• Receiving legal advice /

• Satisfaction with service,

• First awareness of the problem or legal need

• Deciding upon a response to that problem

• Selecting a provider to assist

• Engaging that provider

representation

escalation of any issues

• Feedback, recommendations and referrals to others

• Repeat client?


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Thinking about this as a “consumer journey” allows us to consider how an individual may deal with a problem. We can start to explore their experience of the legal sector, and in particular any interaction with those we regulate, through each sequential stage. More nuanced consumer journeys will exist for different areas of the Bar’s work. For example, while reviewing immigration services, we established that the second stage involves very little “choice” for some in vulnerable situations. People may have to rely on legal services and/or funding locally, when there is little time to influence which legal representative is assigned.

In addition, the nature of the historical model for instructing members of the Bar means that a solicitor often makes an instruction on behalf of the consumer, acting as a professional intermediary. Solicitors are required to act in the best interests of their client in making this choice. The Legal Services Consumer Panel has developed a set of Consumer Principles that apply specifically to the legal sector.67 These are a valuable tool to help identify the consumer interest. In turn, they help us to identify barriers faced at different stages of the consumer journey.

Legal Services Consumer Panel – Consumer Principles Principle

Definition

Access

Can all people get the goods and services they want?

Choice

Is there any? Do people know their options?

Quality

Is the consumer getting a good quality service experience?

Information

Is it available, accurate and useful?

Fairness

Are some or all consumers discriminated against?

Representation

Do consumers have a say in how services are provided?

Redress

If things go wrong, is there an accessible system for putting them right?

67 These principles are based on those provided by the United Nations. See The United Nations (2003) United Nations Guidelines for Consumer Protection.


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We have identified several barriers to consumers in identifying and taking steps to remedy a legal issue, outlined in the table Challenges and above. barriers facing consumers

through their journey

STAGE 1 BARRIERS

STAGE 2 BARRIERS

STAGE 3 BARRIERS

STAGE 4 BARRIERS

IDENTIFYING

CHOOSING

RECEIVING

FOLLOW-UP

• Legal capability amongst the general population is low. Consumers may not recognise an issue as a legal matter, may not know their legal position or how to address it. The legal system is complex to navigate. Unfamiliarity with legal system and where to begin with exploring options. Legal services can often be a distress purchase made under time pressure and in difficult circumstances. Perception issues, particularly around cost, and lack of trust in legal professionals.

• • •

•

• Difficulty for consumers • Consumers can in assessing quality and value. Difficulty in finding an appropriate provider to meet needs – lack of good quality comparison data. Lack of clear information on costs. Choosing basis of instruction (public access, intermediaries, terms of engagement etc) may be confusing.

•

• •

struggle to build trust and communicate their needs effectively, especially under tight time constraints. It is important for consumers to build rapport with their lawyer. Consumers need a service that is tailored to their particular needs, especially if they are vulnerable. Understanding necessary protocol and procedures and implications if the legal outcome is complex. Consumers who take an ‘unbundled’ approach will need to manage lines of responsibility carefully.

• •

•

•

• Complex variety of routes for redress, differing between regulated and unregulated providers. Lack of take-up of redress routes even when dissatisfied. Clients can “find the overall process confusing and often intimidating”. They may perceive that it “is stacked against them” and that it involves “taking on lawyers at their own game”. Limited mechanisms for providing and sharing helpful feedback on service received. Difficulty in separating satisfaction with outcome from quality of service.

• •

• •


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Some of the key barriers on page 39 are explored in more detail below, taking each stage of the consumer journey in turn.

STAGE 1: IDENTIFYING Key issue: Unmet legal need and an increasing number of consumers taking forward cases themselves as litigants in person, mainly due to financial constraints. Legal issues are common. It has been reported by Law for Life that: 68

• Half of the UK population will experience a civil

justice problem every 36 months, falling to just under a third of the population every 18 months.

• The most common legal issues emerge from day-

to-day social and economic interactions: everyday consumer issues, employment, neighbour and money management issues account for more than half of all problems reported.

However, in some cases, individuals may not even realise they have a legal problem. The same study found that only 11% of people identify legal problems accurately.69 When people do identify something as being a legal problem, “it more than doubles the likelihood of … seeking legal help”. For example, one in ten people in rented accommodation had faced a legal problem of some kind relating directly to their housing. Nearly half (47%) characterised their problem as “bad luck”, 18% as “bureaucratic” and just 15% as being a “legal” issue.70

68 Law for Life (2015) Legal Needs, Legal Capability and the Role of Public Legal Education 69 ibid. 70 The Legal Education Foundation (2015) The Legal Problems of Renters

Around 13% of those identifying a legal problem reported taking no action, increasing to 15% for the most severe problems (including clinical negligence and domestic violence). The most common response (43%) was to handle the problem alone, with a further 15% relying on informal advice from friends and family. The proportion of people turning to law firms for assistance sits at just 6%, with 4% turning elsewhere in the advice sector for help.71 63% of the public do not believe that professional legal advice is an affordable option for ordinary people.72 55% of respondents to the Civil and Social Justice Panel Surveys believed that, at the time legal problems arose, they only “partly” understood their legal position, or did not understand it at all.73 Consumers who decide to simply accept their legal issue are likely to underestimate the long term impact it can have on their wellbeing. This can have a significant impact on vulnerable consumers, who are made even more vulnerable as a result. Findings from the Civil and Social Justice Survey show that approximately 15% of 18-24 year olds suffered from physical ill health and 25% from stress-related problems, as a result of their unresolved legal problems.74 Ultimately, people may be disenfranchised from their rights and fail to see justice done if their legal journey stops at this stage. Nearly 10% of respondents to the Legal Services Consumer Panel’s tracker survey stated they had represented themselves in court at some point (referred to as “litigants in person”).

71 The Legal Education Foundation (2015) How People Understand and Interact with the Law) 72 Hodge, Jones & Allen (2015) UK Perceptions of the Legal and Justice System 73 The Legal Education Foundation (2015) How People Understand and Interact with the Law 74 Legal Services Commission (2010) Civil and Social Justice Survey 2006-2009


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The number of people appearing in court without representation in recent years has been rising. Analysis by the National Audit Office suggests that there has been a 30% increase in cases in the family courts where neither party has legal representation.75 For cases specifically involving contact with children, the figure is 22%. This report also found that many litigants in person were not representing themselves by choice but because they could not get legal aid. In evidence to the Justice Select Committee, the President of the Family Division described the situation as follows:

relationships between the barrister, their client and any litigants in person on the “opposing” side can be difficult to manage. Misunderstandings and ineffective communication can result in loss of confidence in the process for one or both sides. We have also received some complaints from litigants in person that are based on a misunderstanding of the role of the opposing barrister. One review we carried out found “a common misconception amongst litigants in person that the opposing barrister will be presenting all of the evidence and a neutral interpretation of the facts”.78

“Previously we had a lot of litigants in person who were there through choice. They tended to be people who had a particular point of view, but who understood the case, were articulate and had the confidence to appear in court. We now have a lot of litigants in person who are there not through choice and who lack all these characteristics.”

These findings suggest that there is an opportunity for members of the Bar and other lawyers who find new ways to make themselves accessible to consumers not currently benefiting from legal assistance. This could be achieved, for example, by effective marketing and public legal education work, adoption of new technologies and an increased online presence. Another option could be exploring how new models such as online crowd-funding for litigation could open up access for more clients to legal services. 79 There is a high level of unmet need. More needs to be done to understand what is preventing this need from being met and therefore restricting access to justice for some sectors of society.

Sir James Munby, President of the Family Division of the High Court of England & Wales76 Many litigants in person face a significant challenge in navigating the complexity of the law and associated procedures and protocols during what can, for some, be a particularly difficult time. Alternative sources of support and assistance play an important role and demand for these services has increased significantly.77 McKenzie Friends cannot act as legal representatives, but provide other assistance and in some cases are now charging clients for their services.

The Bar can assist by continuing to support provision of free or affordable legal services where possible. It can work to keep costs at accessible levels, offer flexible pricing models and client financing options and provide clear information to help manage expectations and provide certainty (where possible) around costs.

Courts and tribunals continue to adapt the way they operate to help ensure the effective administration of justice and the judiciary may call upon barristers for one party to assist any unrepresented parties. The 75 National Audit Office (2014) Implementing reforms to civil legal aid 76 House of Commons Justice Committee (2015) Impact of changes to civil legal aid under Part 1 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 77 Personal Support Unit (2015) Annual Report

78 Bar Standards Board (2012) Thematic review: Complaints received from litigants in person 79 Facilitated by websites such as www.crowdjustice.co.uk

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STAGE 2: CHOOSING Key issue: There is a lack of information to help consumers to choose an appropriate lawyer. There is little to help consumers to distinguish between lawyers on quality, value and affordability. The affordability of professional legal advice is a significant issue. The Legal Services Board’s research suggests that “perceived high cost is [one of the] main barriers to accessing legal services for small businesses”.80 Increased court and tribunal fees are likely to have exacerbated this issue in our view. While there are many challenges in deciding how best to respond to a legal issue, there are also positive developments in the market that are helping to improve consumer choice. There is a large range of legal service providers and an increasing number of different business models they can adopt to deliver services more effectively, ie in a way that better meets consumer needs. Barristers, for example, can now operate within entities that are authorised and regulated by us, and can also offer consumers the choice of instructing them directly without the need to go through an intermediary (such as a solicitor). This may help to simplify matters and can help to keep costs down. Consumers are able in some cases to have more flexibility around what portion of a legal matter is handled by their legal advisor and what they will do themselves, through “unbundling” of services. This can help people to retain more control of their own case, and of the costs involved. 70% of recent users of legal services felt they had a choice when looking for a provider, and 25% said they shopped around to choose the best provider.81 Some websites allow consumers to review the service they 80 Legal Services Board (2016) Cost of Services 81 Legal Services Consumer Panel (2015) Tracker Survey 2015


have received, so others can be better informed. Takeup of these websites has been limited to date and we would like to see that increase. Further opportunities exist for members of the Bar who are able to market themselves directly to their target consumers. Stronger legal brands could actually help consumers to navigate the legal system by making it easier to find providers who can meet their specific needs and offer regulatory protections.

Spotlight on... Immigration services We are currently undertaking a thematic review of immigration services, building on research commissioned in 2013.82 Through engagement with community organisations, advisory agencies and practitioners who specialise in immigration we have been further building our understanding of issues facing those who need immigration and asylum advice. We have identified a range of concerns, including inadequate information for users of immigration services. With the fast pace of change to immigration and asylum laws, the current political climate and significant international factors fuelling immigration, this is a sector under considerable pressure. One of the points at which consumers face particular difficulties is in finding the right provider to suit their needs and at the right time. This is because many are in vulnerable situations with limited access to information including a lack of internet access. They are reliant on word-of-mouth, community-based advice or the guidance of other advice agencies. Even where somebody is able to search online for help, there is a lack of concise, reliable and independent information. If such information does exist it is hard to find amongst the volume of marketing information from organisations – regulated and

82 Bar Standards Board (2013) Immigration Client Experience Research


unregulated – offering legal services of one kind or another. We are working on our review with external stakeholders working in the sector, and one of the themes focuses on improving the accessibility of accurate information. This includes providing advice on when the services of the Bar are worth considering, how to find an appropriate barrister and what questions to ask them. We need to look beyond our own website for ways to reach those in vulnerable situations and to help them to find appropriate legal advice before things have already gone wrong for them. Our stakeholder group indicated that the Bar in particular tend to be called upon once people have already attempted to handle a matter alone or with limited advice and things are going wrong, indicating that a small amount of input earlier on in the process could be valuable. Judging the quality of provider, and the value for money on offer can be particularly challenging for legal consumers. There is little information or clear advice on how to assess the quality and appropriateness of different legal providers, and lack of clear information on costs means that affordability concerns pose a real barrier. This may be because the actual costs involved are too great. The absence of certainty around costs or perceptions about the value for money of paying for help can also be barriers for consumers. Whilst consumers now have more flexibility to instruct the Bar directly, to “unbundle” their matter and keep costs down by doing some work themselves, this generally relies upon the consumer taking a more confident approach to securing services and may not be a realistic option for many, particularly those in the most vulnerable circumstances.

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STAGE 3: RECEIVING Key issue: Cross-cultural communication and the Bar’s ability to accommodate client vulnerabilities In the course of practice, members of the Bar may engage with people from all kinds of backgrounds in a variety of different situations. This often includes people in vulnerable circumstances. Being able to engage effectively with clients is a vital skill for any competent legal services provider. This includes being able to elicit clear instructions and ensure that clients are informed of the process, outcome and impact of their legal matter. We have included these skills within the professional statement around which our changes to the education system for barristers will be built. An important aspect of being able to communicate effectively with clients from all parts of society is known as cross-cultural or inter-cultural competence. In other sectors and jurisdictions more research exists already, for example on the impact on patient care in a medical context. Speaking at our symposium in January 2016, Dr Ranjit Sondhi (Queen’s Counsel Selection Panel) described communication as the “stock in trade” of barristers. He said “I cannot think of any other profession where both the content and style of talk and text are so fundamental to achieving a just and fair society”. 83 We think that barristers who can communicate effectively with a wide range of clients will be better at understanding and meeting clients’ needs, will generate greater client satisfaction, and will be able to 83 From a speech given at the BSB’s Symposium on Cross Cultural Communication at the Bar, January 2016. Read our full report at: https://www.barstandardsboard.org.uk/media/1750588/bsb_ccc_ report_april_2016.pdf


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conduct their business more efficiently. Ultimately this will help to ensure fair access to justice for everyone. In a diverse society and for a Bar offering services within a global market place, the ability to offer culturallyappropriate services is an important differentiating factor for those providers who do it well. Identifying any client vulnerabilities and taking steps which may help to better accommodate that client’s needs is an essential element of acting effectively and in the client’s best interests. Client vulnerabilities can present themselves in a variety of ways. Some may be obvious and be easy to identify. Others may be invisible.84 Barristers and others who engage with clients can take steps to build skills and introduce processes to help them to sensitively and systematically respond to client vulnerabilities and tailor their services accordingly.

Spotlight on...

The research found some examples of good practice. However, it also highlighted examples where advocates had struggled to communicate effectively with young defendants and witnesses including under cross-examination. The research also found examples where advocates had seemingly failed to recognise the significance of the Youth Court and the impact of decisions on the young people involved. Researchers heard first-hand from young defendants about the importance of rapport and effective communication with their legal representatives:85 “It’s important that they’re friendly as otherwise you’re not going to be able to interact with them and actually trust them enough because you’re obviously supposed to tell your solicitor everything and if they’re not friendly enough, people won’t be able to open up to them.”

Youth court proceedings

[Talib, aged 16]

Together with CILEx Regulation, we commissioned independent research into the risks associated with youth court advocacy. The research proved invaluable in understanding the impact of poor advocacy on young people. In particular it highlighted the difficulties that many barristers experience when communicating with young defendants and witnesses. We view this as an area of high risk given the vulnerability of the young people within the youth justice system and the impact that poor advocacy could have on them and their future life choices. The purpose of the research was to develop a better understanding of what was happening in the youth courts in order to determine what regulatory interventions, if any, would be needed. The research directly engaged with young people and those agencies that represent them and their interests in the youth justice system.

“He listened to us, he knew how it was affecting me, I could see it when I was telling him… he was like God, because he listened to me. Some of them are just like, it’s just another day, another kid to put in prison… He made me go through all of it, write everything down… he wanted to talk to us about it, he went through saying ‘how did that make you feel, how would that happen’ and this and that: it was good.”

84 Legal Services Consumer Panel (2014) Recognising and Responding to Consumer Vulnerability

[Riley, aged 16] In the light of the research, we are currently working with others in the Youth Justice sector to identify the best ways to address the concerns raised about the standards of advocacy.

85 Bar Standards Board (2015) The Youth Proceedings Advocacy Review: Final Report


STAGE 4: FOLLOW-UP Key issue: a need for a clear and effective means of redress when things go wrong The Legal Services Consumer Panel’s tracker survey found in 2015 that 8% of users of legal services were dissatisfied with the service they had received from a provider and 6% were dissatisfied with the outcome of their legal matter. Of those dissatisfied about service, 42% did nothing about it. This is higher than the average of 25% for the services sector overall.86 Judging the quality of the legal work undertaken on their behalf can be difficult for many consumers. This is because their legal issues can be complex and many clients are inexperienced in dealing with lawyers. Distinguishing between poor service and bad advice can be difficult. An adverse outcome from the legal process is likely to have a negative impact on a client’s satisfaction with the handling of their matter by the provider. Consumers in particularly vulnerable circumstances may face additional barriers when seeking or when entitled to redress. For example, those with low literacy levels, the time-poor, detainees or those who have been deported find it especially challenging to seek redress for the poor service or advice they have received. The variety of different routes available to seek redress further complicates the situation. The following list demonstrates the complexity:

• Complaining directly to the provider concerned –

clients are required to do this in the first instance.

• Clients can then escalate any unresolved matters to the Legal Ombudsman for consideration. The

86 Uswitch (2015) Only 25% of Brits complain when subjected to poor customer service available at: http://www.uswitch.com/ gas-electricity/news/2013/05/29/only-25-of-brits-complain-whensubjected-to-poor-customer-service/

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Ombudsman can award redress for inadequate service but only for regulated providers.

• Clients also have the option of using Alternative

Dispute Resolution, now signposted to them by barristers, following the Consumer Rights Act 2015.

• Some regulated providers are covered by a financial compensation scheme which could help those affected by a lawyer’s, or third party’s, failure to account for client money.

• For some problems, clients will need to engage with a lawyer’s professional indemnity insurers.

• Some consumers may also complain to Trading

Standards, who may investigate unfair commercial practices.

• Regulators such as the BSB, who may investigate

concerns about the conduct of legal professionals are able to assist in more limited circumstances, and also deal with complaints from non-clients.

• In other circumstances, it may be that further legal

action is appropriate, such as an appeal following litigation or judicial review. This may involve instructing further professional legal assistance, and in some immigration cases, an appeal can only be launched from an individual’s home country.

For many of the Bar’s clients, the picture may be further complicated by having multiple parties involved who may have contributed to any issues – for example, a solicitors’ firm acting alongside the barrister; or a client may have retained responsibility themselves for some activities as part of an “unbundling” arrangement with a public access provider. For any service provider, client feedback is a good way to improve practice, client offering and to build business through positive referrals. Clearly signposting opportunities for clients to raise concerns through making a complaint is a regulatory requirement.


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Service providers can gain additional benefit by ensuring that clients also have a means to provide feedback more generally. Being able to learn from any feedback received can help to improve the quality of service offered and to improve client satisfaction in the future. Our supervisory staff share examples of good practice and work with chambers to help them to improve the way in which this is done. We are also improving our information for the public to help them to know what to expect from the Bar and to make it easier for anyone to contact us to raise concerns or complain about those we regulate.

The role of the regulator Our role in relation to the risks and issues in this theme, of failure to meet consumer needs, involves:

• regulating members of the Bar to ensure that the consumers they engage with are given a service which meets proper standards and is in the consumer’s best interests;

• encouraging legal service providers – and in particular the Bar – to adjust their service to vulnerable consumers where appropriate;

• working with others to provide information that

helps consumers to navigate the legal services market and the legal system more widely, whether or not they decide to use a barrister; and

• balancing the need to safeguard consumers and

to uphold standards with the need not to constrain the supply of barristers’ services unnecessarily through disproportionate regulatory barriers or cost burdens.

What we need to do Having described our role in this area above, here is a list of actions that we need to take:

• We need to develop our understanding of how

consumers interact with the legal market and the legal system by engaging directly with consumers and the organisations representing them. Our Consumer Engagement Programme is one of our main vehicles for doing this.

• By better understanding consumer needs, we will

be better able to target our regulation where there is evidence of greatest risk and consumer detriment. Specifically, we are continuing with our work on immigration and asylum services and on youth court advocacy. We are also building our understanding of the experiences of other court users who may be in particularly vulnerable situations, such as victims, witnesses and litigants in person.

• We will need to work together with others in the

sector to understand our specific role in addressing the education of consumers and the public on legal matters.

What the Bar and its institutions can do to help

• The Bar needs to continue to develop their

understanding of the consumers they serve and ensure that their service meets the standards expected.

• The Bar and their chambers can improve clarity for consumers about costs and their charging structures.

• The Bar should focus on being able to provide

services to consumers from all backgrounds and especially those who have one or more of the vulnerability characteristics. This should include being able to communicate effectively with consumers from different cultures and backgrounds.


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Theme 2 Lack of diversity; discriminatory working culture and practices This theme considers the lack of diversity within the Bar and the risk of discriminatory working culture and practices. These can affect the Bar’s ability to be strong and effective, to meet the diverse needs of consumers and to present sustainable career opportunities for future barristers.

Theme 2 in brief

• For society to have continuing faith in the legal

system, the system needs to reflect the changing make-up of the people it serves. The Bar is a key source of appointments to the judiciary, making it especially important that it is diverse.

• The Bar has worked hard to encourage diversity, but there is room for improvement.

• Some of the challenges of achieving equality

and diversity within the Bar are as a result of challenges within wider society. There are ways in which we and the Bar are trying to mitigate some of these challenges.

• Members of the Bar face many work demands

that could affect their general wellbeing. This could encourage anti-social or inappropriate workplace behaviours, potentially affecting not just the Bar, but the public they serve as well.

• As the regulator, we must continue to adapt

our own approach. We must lead by example in order to strike a balance between enabling and requiring the Bar to improve diversity and encouraging a positive working culture.

Why we think this matters Valuing individual and group differences, promoting equality of opportunity and eliminating discrimination are hallmarks of a fair society. Those who provide legal services are instrumental in maintaining an equitable society and using the legal system to hold people to account under the rule of law. For everyone in society to continue to have faith in the legal system, that system needs to reflect the changing make-up of the society it serves. Our statutory regulatory objectives require us to promote a strong, independent, diverse and effective legal profession. Most senior judges in England and Wales are recruited from the Bar and so it is especially important that the Bar is diverse and that its practices are nondiscriminatory, culturally aware and sensitive. If this is not the case, some in society may not have confidence in the legal system’s ability to provide justice for them. Every member of a society is bound by, and entitled to the protection of, the law. Consumers of all types and from all backgrounds have a fundamental right to be treated fairly by the legal system. ‘Diversity is important, not just [for] public confidence in justice. It is inherent to justice itself because it represents both fairness and equality in opportunity.’ Lord Chief Justice, Lord Thomas of Cwmgiedd, 2015 87

• We want the Bar to work with us to develop

strategies that encourage diversity and positive working practices.

87 Thomas (2015) Speech for the Temple women’s forum, Leeds, available at: https://www.judiciary.gov.uk/wp-content/ uploads/2015/10/temple-womens-event-leeds-oct-2015.pdf


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The risks from our Regulatory Risk Index associated with this theme are: 2.6 Discrimination, victimisation, harassment or bullying 3.3 Lack of cultural competence and people skills 4.4 Poor recruitment, retention and promotion practices 4.7 Workplace culture 5.6 Lack of diverse and representative profession 5.7 Excessive barriers to supply of legal services


• The Bar supports equality of access to justice for all, and is recognised for effectively serving consumer needs locally and globally.

• The Bar consists of lawyers from a wide range

of backgrounds whose different perspectives are valued in driving innovation and new thinking within a vibrant legal sector.

• Socio-economic background or other characteristics do not preclude any individuals with the right potential from developing their capabilities, joining the legal profession and progressing in their career.

• The Bar continuously identifies and overcomes

practices which could have enabled unconscious bias to impact on opportunities for certain groups. It also ensures its ways of working are inclusive to all.

• Barristers are known for their skills in providing

culturally appropriate services that meet the needs of clients from a wide range of backgrounds both at home and abroad.

Background Some fifty years ago, approximately 95% of the selfemployed Bar was male88 and at the end of the 1960s, female Queen’s Counsel numbered just three. There has been a great deal of progress since then at the Bar, not just in terms of gender diversity, but with other characteristics too. The following chart shows the latest available diversity data for barristers progressing through each key milestone in their careers, including the early stages of qualification.89 The higher levels of diversity amongst those joining the profession (shown in the chart overleaf) should in time be reflected increasingly across the Bar. For example, whilst 36% of practising barristers are female, the proportion amongst newlypractising barristers is almost 50%, and nearly 20% of that same intake are Black and Ethnic Minority (BME), compared to 12% in the general population of practising barristers.90 However, it has been suggested that there is less diversity amongst practitioners who specialise in some particular areas of work. We are interested to improve our understanding of any trend here. At present, we do not have sufficient data to support further analysis but we would like to investigate the diversity within different segments of the Bar, and to understand better the career paths taken by different individuals and groups. In this section of the Outlook, we will explore some significant barriers and challenges for barristers at different stages of their careers. Some of these affect

88 Bar Council data 89 BSB Diversity data (2015). Note, we have focused here on gender and ethnicity, for which we have the best available data at present. 90 BSB Diversity data (2015)


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the diversity of people looking to join the Bar and through to the first couple of career milestones; some affect people practising as a barrister and some affect barristers looking to progress into senior roles. In all circumstances, they can restrict the Bar’s ability to meet consumer needs and those of the wider public.

Chart showing diversity at key stages of progression through a barrister’s career by gender and ethnicity This chart shows diversity of individuals recently progressing through eight key points on the path through qualification to practise and subsequent progression to senior roles. The equivalent figures for the adult population of England and Wales are also shown for comparative purposes.

56%

43%

40% 36%

19% 14% 8%

%BME

Path to qualification and practice

Law degree intake

BCAT* cohort

BPTC** intake

Newly called to Bar

Pupillage intake

Newly practising barristers

QC*** appointments

England & Wales 10% population: 14% BME

Judicial recommendations

Senior roles

%Female

23%

40% 48% 52%

50%

48%

48%

England & Wales population: 50% Female

62%

*BCAT: Bar Course Aptitude Test **BPTC: Bar Professional Training Course ***QC: Queen’s Counsel

Sources: 2011 Census: Population estimates for the United Kingdom & Ethnicity and National Identity in England and Wales 2011, Law students: Law Society Entry Trends, Bar Course Aptitude Test: BSB BCAT Candidate Diversity Data 2014, Bar Professional Training Court: BSB BPTC Key Statistics Report, Newly called to the Bar: BSB Core database, Pupillage intake: BSB Pupillage Statistics, Newly practising Barristers: BSB Core database, Queen’s Counsel appointments: Report of the QC Selection Panel, Recommended for Judicial office: provided by the Ministry of Justice


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Joining the Bar: financial and social barriers We have sought here to explore factors affecting social mobility in the context of qualification as a barrister. In doing this, we face the inevitable danger of oversimplification and failure to convey the nuance and complexity of the situation. We have nonetheless below set out a partial picture based on proxies where we have them of where some of the barriers to qualification may lie. We invite readers to challenge, refine and build upon this starting point.

difficulty in obtaining finance or be unwilling to take on debt of this level.

• Elitism around the type of school attended:

It is reported that certain legal providers “have developed stronger links with selective and independent schools, compared to comprehensives” and “assist private schools in their careers education programmes”.95 It is important to understand how these relationships are perceived and how they affect those considering qualifying as barristers. However, significant work is needed to improve social mobility and make the Bar representative of society. Recent analysis by the Sutton Trust has shown that over 70% of QCs and judges were privately educated and a similarly high proportion had attended Oxford or Cambridge Universities.96 This is in contrast to 7% of the public who have attended private school and less than 1% who attend Oxford and Cambridge.97 Our recent diversity analysis of data provided by practising barristers showed that 38% of respondents to our diversity monitoring questionnaire who went to school in the UK attended one that charged fees.98

In the Government’s “Opening Doors, Breaking Barriers” publication91, it is noted that “only one in five young people from the poorest families achieve five good GCSEs including English and Maths, compared with three-quarters from the richest families”. Given that BME groups are more likely to be in poverty than white British people92, as are disabled individuals relative to non-disabled individuals93, this socio-economic disadvantage has wide-ranging effects that can negatively affect the diversity of those joining the Bar. We explore five different types of barriers below, acknowledging the limitations of such a brief analysis:

• Preference for traditional qualifications: The Legal

Education and Training Review found A-levels to be the dominant qualification in determining access to higher education, especially “in controlling access to high demand subjects (like law) at elite universities”.99 This can indirectly impact on BME students, who may study other qualifications. One study found that “nearly two-thirds (65%) of black students took an alternative route into higher education [relative to the traditional A-level route] versus an average of 35%”.100 An older study found similar results: “fewer [BME students] take the traditional ‘A level’ route, and are more likely to come into higher education from further education

• Financing the cost of training: The impending

replacement of maintenance grants for students from low-income households with larger maintenance loans will increase the long-term cost of going to university. This risks reducing the diversity of students studying law. The Bar Professional Training Course (BPTC) fees range between £12,500 and upwards of £18,000. This does not account for living costs while studying, and BPTC students are not usually eligible for student finance.94 Students in lower income households may struggle to afford this, have

91 HM Government (2011) Opening Doors, Breaking Barriers: A Strategy for Social Mobility 92 Data available at: http://www.irr.org.uk/research/statistics/ poverty/ 93 Data available at: http://www.poverty.org.uk/40/index.shtml 94 Changes to postgraduate funding may enable the BPTC to be eligible for up to £10,000 of finance if provided as part of a Master’s degree.

Legal Services Board (2010) Barriers to the legal profession The Sutton Trust (2016) LEADING PEOPLE 2016 ibid. Bar Standards Board (2015) Report on Diversity at the Bar Legal Education and Training Review (2012) Literature review: 7. Current Equality, Diversity and Social Mobility Issues 100 Department for Business Innovation and Skills (2009) Alternative routes into and pathways through higher education 95 96 97 98 99


colleges”.101 This also impacts disabled individuals, who are less likely to be studying three A-levels than non-disabled individuals.102

• Role of personal contacts: Personal relationships

and networking can provide advantages in the recruitment process for mini-pupillages and pupillages (though there is a requirement in our Handbook for these processes to use objective and fair criteria).103 The extent of a person’s personal contacts is highly dependent on social position and the occupations of a student’s parents/guardians. In one survey, a large number of respondents from the South of England believed they owed their career to “one or two key legal professionals… who had gone to extraordinary lengths [for them]”.104

• Perceptions of the legal profession: Having to

overcome the hurdles described above affects students’ perceptions of the Bar. In turn, this may cause the most able candidates to opt for a different career. Research by Ipsos MORI in 2007 showed that only 50% of female barristers believed the Bar attracted the best candidates and nearly nine in ten barristers believed that “uncertainty of acceptance into chambers and the cost of training” were barriers to entry.105 Another study showed that almost 40% of black students believed they would encounter discrimination if they pursued a career in law.106

A number of outreach activities and social mobility initiatives exist to promote the Bar to diverse groups, many run by the Bar Council and Inns of Court. For example, the Bar Council organises placement weeks each year for Year 12 and Year 13 students to learn

101 Connor et al. (2004) Why the difference? A closer look at higher education minority ethnic students and graduates 102 Legal Education and Training Review (2012) Literature review: 7. Current Equality, Diversity and Social Mobility Issues 103 Bar Standards Board (2015) Handbook 2nd Edition Section D, Part 2, D1.2, rC110 104 Legal Services Board (2010) Diversity in the legal profession in England and Wales: a qualitative study of barriers and individual choices 105 Bar Standards Board (2007) Perception of barristers: Research study conducted for the Bar Standards Board 106 Elevations Networks Trust (2012) Race to the Top – The Experience of Black Students in Higher Education

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more about the Bar107 and the Inns of Court offer financial assistance through annual awards.108 Our own Future Bar Training programme is looking at the way we regulate education and training for barristers. We have identified areas for improvement. For example, in 2015 we spoke of our concern that “our current requirements [for the Bar Professional Training Course] are unnecessarily prescriptive”.109 This may have affected applications from those who have taken non-traditional routes, including many students from diverse groups. We are working to ensure that our regulation does not get in the way, but supports a healthy market for training to become a barrister. More on the Future Bar Training programme can be found on our website.110

In practice: working culture at the Bar Our report, “Barristers’ Working Lives”, shows that the average hours worked by full-time practising barristers is 52 hours per week111 as compared to 43 hours for all full-time employees in the UK.112 There are logistical challenges in the working practice of barristers, such as:

• The uncertainty for barristers about when and where they may be needed to work;113

• The significant breadth of geographical areas in

which some barristers are expected to represent clients within some Circuits; and,

107 See http://www.barcouncil.org.uk/media-centre/news-and-pressreleases/2015/february/bar-council-holds-second-annual-barplacement-week-in-leeds-and-manchester/ 108 The Council of the Inns of Court (2011) Response to the Legal Education and Training Review Discussion Paper 109 Bar Standards Board (2015), Future Bar Training Programme Update 110 See: https://www.barstandardsboard.org.uk/qualifying-as-abarrister/future-bar-training/ 111 Bar Council and Bar Standards Board (2013) Barristers’ Working Lives: A second biennial survey of the Bar 112 BBC News (2011) UK employees work longer hours than most EU neighbours, available at: http://www.bbc.co.uk/news/ business-16082186 113 The Law Society Gazette (2015) Short-notice listing will harm diversity – criminal practitioners, available at: http://www.lawgazette. co.uk/law/short-notice-listing-will-harm-diversity-criminalpractitioners/5052369.fullarticle


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• The practice of being expected to accept briefs at

very short notice. This requires barristers to invest substantial amounts of effort in a very short period of time.

These challenges can be compounded for barristers who are disabled or who have caring responsibilities. A 2015 Bar Council report looked at the experiences of women at the Bar, many of whom now feel that the inconvenience of long hours at the Bar and a lack of flexibility is not compensated for by income levels.114 We are concerned that these challenges may be driving those with caring responsibilities out of some areas of the profession. On top of the issues highlighted above, there are also reports of barristers experiencing bullying and harassment. The “Barristers’ Working Lives” survey showed that 18% of employed barristers and 7% of self-employed barristers have personally experienced bullying or harassment.115 In 73% of cases, the bullying and harassment identified was “linked to” protected characteristics.116 Another survey showed that 41% of employed barristers were either not treated fairly or only sometimes treated fairly within their organisation, as compared to 19% of self-employed barristers within chambers.117 The numbers in absolute terms are concerning issues within both the employed and selfemployed Bar that need investigation. Detailed evidence of specific cases is rare. Members of the Bar should speak up when witnessing or being subjected to such behaviour – protections exist for both employed and self-employed barristers. For those within chambers, the Equality and Diversity Officer (required under rC110 (3) (a) of the BSB Equality Rules) could be a first port of call. In addition, the requirement to report serious misconduct to us (rule rC66 of the BSB

114 Bar Council (2015) Snapshot: The Experience of Women and the Self Employed Bar 115 Bar Council and Bar Standards Board (2013) Barristers’ Working Lives: A second biennial survey of the Bar 116 As defined in the Equality Act (2010) 117 Bar Council (2015) Wellbeing at the Bar

Handbook) encompasses instances of discrimination, harassment and victimisation. We have specific guidance on this on our website.118 This guidance makes it clear that “action [in response to serious misconduct] will only be taken in relation to the barrister or lawyer concerned where this is appropriate, proportionate and in accordance with [our policies].” We have referred instances of discrimination, harassment and victimisation to our Professional Conduct Committee119 for disciplinary action. The impact of these cultural issues on barristers’ wellbeing is a key concern for us as a regulator. We need to understand better how we can tackle these issues. The Bar Council, which represents barristers in England and Wales, is currently exploring wellbeing too as there are representative concerns they can assist with, alongside the regulatory concerns for us. You can find out more about the Bar Council’s work in this area on their website.120

Opportunities and progression at the Bar While evidence is limited, there are also indications of senior barristers misusing their position of power over pupils and junior barristers. Talking with barristers, we have also heard about women being given lower paid work than men, and suggestions that clerks are not always allocating work or agreeing fees fairly for junior barristers. Ensuring positions of power are not misused at the Bar should help increase the number of applications from diverse groups to senior roles. This is because these groups will be less likely to leave the Bar before obtaining the necessary experience. Improving the culture of the Bar will also facilitate this. The graph below shows the current position for applications to Queen’s Counsel and the judiciary. This focuses on female and BME barristers.121 118 See https://www.barstandardsboard.org.uk/media/1666565/ reporting_serious_misconduct_of_others__august_2015_.pdf 119 The Professional Conduct Committee makes decisions about complaints regarding the conduct of barristers. More information can be found on our website. 120 See http://www.barcouncil.org.uk/supporting-the-bar/wellbeing-atthe-bar/ 121 The percentage of barristers who tell us about their position for the other protected characteristics are lower; making it difficult to draw a comparison between applications and recommendations and the Bar.


53

Achieving a representative profession in senior roles requires a significant increase in both applicants and appointments from diverse groups. Supporting these groups in having better control over their careers is a

key means to achieve this. This relates directly to our regulatory objective to encourage “an independent, strong, diverse and effective legal profession” and will help sustain public confidence in the legal system.

Chart showing progression to senior roles by gender and ethnicity This chart shows the diversity of practising barristers with over 15 years’ call compared to those progressing to QC or judicial status.

40%

40%

39%

27% of barristers with 15+ years call are female

30% 23%

14%

Queen’s Counsel

Judiciary Female

10%

Applications

9% Successes

Applications

Successes

0%

Successes

10%

Applications

13%

Successes

20%

12% of barristers with 15+ years call are BME

20%

Applications

% of all individuals who are female or BME

50%

Judiciary

Queen’s Counsel BME

QC applicants are compared with the set of people subsequently recommended by the panel for appointment by the Lord Chancellor during the latest available period. Judicial applicants are compared with those recommended for appointment, whether immediately or as a vacancy becomes available. Sources: BSB Core database and Ministry of Justice data


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Spotlight on... Experience of Women at the Bar Earlier this year, we launched a survey to improve our understanding of women’s experiences of the equality rules in our Handbook. The survey invited all women from the Bar to respond and explored areas including harassment, recruitment practices and work allocation. This follows on from what has been learnt about the impact of the Bar’s working culture for women through previous research – a report in 2011 for example highlighted the sudden decline in the number of women at the Bar at 12 years of call.122 The equality rules were originally introduced in 2012, in part, to support women’s retention and progression at the Bar and we have since monitored and helped barristers to improve compliance with the rules. The survey attracted over 1,300 responses, which refer to both positive and negative experiences of women at the Bar. We are currently analysing these responses and intend to publish quantitative and qualitative analysis in a report later this year. It will, for example, explore the reasons why women who experienced harassment may have chosen not to take any action at the time. We are already working with stakeholders to review findings and look forward to engaging further to determine what actions we can take in response. There are two specific areas of focus for us in starting to address some of the issues around working practices at the Bar – cross-cultural competence and anti-discriminatory working practices.

122 Bar Standards Board (2011) Barristers’ Working Lives: A Biennial Survey of the Bar

Cross-cultural competence In theme 1, we explored cross-cultural competence from the perspective of a barrister engaging with a consumer (see page 43). It is also important for the Bar to be able to communicate well with each other and with other legal professionals. This extends beyond those that they may work alongside in chambers and into places such as the court room. The concept of cross-cultural competence tends to be associated with ethnicity, race and language as these are the most visible cultural differentiators. However, the concept covers the ability to understand, empathise and communicate with people from all different backgrounds and across all protected groups. Socio-economic status is also an important cultural factor within the legal system, affecting the public’s experience of the legal system. For example, a survey by one law firm found that 50% of people earning £48,000-£55,000 believe the legal system is accessible to anyone, whilst only 34% of people earning at the lower end of the income scale feel the same way.123 There have been numerous high profile examples of the impact of poor cross-cultural communication, in particular with regard to recent reports of sexism and racism at the Bar.124 More widely, a breakdown in cross-cultural communication can affect relationships and can escalate into instances of discrimination. Being unaware of colleagues’ preferences, beliefs and views can prevent effective working relationships. It can also lead to unintentional harassment or victimisation – and in instances where they are made public – undermine the public’s confidence and trust in the Bar. We have a programme to explore the importance of cros-cultural communication at the Bar. Details of our first report are on page 43.

123 Hodge, Jones & Allen (2015) UK Perceptions of the Legal and Justice System 124 For example, The Guardian (2015) Barristers face ‘career suicide’ for exposing lawyer’s sexist remarks, Available at: http://www. theguardian.com/law/2015/sep/10/barrister-career-suicideexposing-lawyers-sexist-remark


Anti-discriminatory practice The term “anti-discriminatory practice” refers to policies, procedures and actions taken to prevent unlawful discrimination against individuals. This discrimination could be direct or indirect.125 The recruitment, promotion and retention of individuals is one area where it is important that good practice is adopted. For example, the concept that networking – leading to increased opportunities and ultimately promotion – can happen “in the pub after work”126 can discriminate against those with caring responsibilities or those who choose not to consume alcohol on religious or health grounds. Often, biases in how we judge and evaluate others are unconscious. One study found that for identical job applications, simply changing the apparent gender of the applicant had a substantial impact. Candidates given male-sounding names were rated as better qualified, deserving of a higher salary and more investable in terms of their development compared with the candidates given female names.127 The unconscious preference to hire people who reflect the recruiter’s own image and personality128 is another bias which occurs in all industries. In the context of the Bar, the lack of diversity at the top is likely to hinder change as unconscious bias will favour the status quo. This makes it more difficult to move from a position of low diversity to greater representation of minority groups in senior roles. Making assumptions about an individual or group, based on the communities they belong to, can sometimes lead to discrimination. Although these assumptions may have good intentions, this does not excuse them. For example, clerks may assume that 125 The Equality Act (2010) considers direct discrimination as one individual discriminating against another because of a protected characteristic. This is contrasted against indirect discrimination, where one individual applies a provision, criterion or practice that has a discriminatory impact on some groups or individuals. 126 Bar Council (2015) Snapshot: The Experience of Women and the Self Employed Bar 127 Moss-Racusin et al. (2012) Science faculty’s subtle gender biases favour male students 128 HR Magazine (2010) Equality: Unconscious bias and the mini-me syndrome

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barristers returning to work from parental leave do not have the time to handle certain cases. This is an inappropriate assumption. Instead, the clerk should communicate with each barrister to understand their specific circumstances. These practices threaten social justice and equality. Adopting an anti-discriminatory approach enables any business to ensure it recruits, retains and promotes the best talent, bringing clear benefits. The policies, procedures and actions required to prevent these situations do not need to be complex. Opening up networking opportunities to more people could be achieved by holding some networking events during lunch time within a café or restaurant, for example. Similarly, asking barristers returning from maternity or paternity leave if they require any adjustments will be more effective than making assumptions.

Spotlight on... Disabilities at the Bar According to a report by the charity Scope, despite progress driven by disability discrimination legislation, negative public attitudes and awkwardness about disability persist. This is demonstrated by the following statistics found in the report:129

• Two thirds (67%) of the British public feel uncomfortable talking to disabled people;

• Over a third (36%) of people tend to think of

disabled people as not as productive as everyone else;

• Over four fifths (85%) of the British public believe that disabled people face prejudice;

129 Scope (2014) Current attitudes towards disabled people


56

• A quarter (24%) of disabled people have

experienced attitudes or behaviours where other people expected less of them because of their disability;

• One fifth (21%) of 18 – 34 years old admit that

they have actually avoided talking to a disabled person, because they were not sure how to communicate with them.

For the Bar, there are issues that warrant attention for disabled barristers and consumers. These include physical access, attitudinal barriers, service delivery, widening access to the profession, training and education, career development, disability discrimination and data collection. We have limited data about the number of disabled barristers. Our last diversity report showed that 1.6% of practising barristers consider themselves to have a disability. However, over 70% of barristers have not declared their disability status to us.130 There is a perception held by some people that disabled lawyers “cannot physically meet the demands of practising law”.131 Some chambers premises, particularly in London, are listed buildings where physical adaptations can be a challenge to implement. This can limit the ability of physically-disabled barristers to work effectively. Likewise, many court buildings are old or listed. With regards to mental health, it is concerning that one survey found that almost two-thirds of barristers agreed that “showing stress at work indicates weakness”.132 This encourages barristers to manage their problems without getting appropriate support.

We need to ensure that the Bar can identify concerns, share them without shame or regret and receive appropriate and confidential support.

The role of the regulator Our role in relation to the risks discussed in this theme, lack of diversity; discriminatory working culture and practices involves:

• Leading by example through the way in which we

promote equality and diversity as an organisation.

• Encouraging access to the Bar, for diverse groups, from the earliest stages of training.

• Promoting diversity at the Bar by helping to

eliminate unlawful discrimination, by advancing equality of opportunity and by fostering good relations between different groups. These actions mean upholding our statutory obligations under the Legal Services Act 2007 and Equality Act 2010

• Collecting and making available, high-quality

data on diversity at the Bar. This role includes making sure that the evidence to demonstrate any problems is robust and that where necessary, it supports a social and commercial case for improvement.

• Adopting a regulatory approach that strikes the right balance between enabling and enforcing compliance in this area.

What we need to do Having described our role in this area above, here is a list of actions that we need to undertake:

130 Bar Standards Board (2015) Report on diversity at the Bar 131 The Guardian (2011) Disabled lawyers still face discrimination, Available at: http://www.theguardian.com/law/2011/sep/01/ disabled-lawyers-still-face-discrimination 132 Bar Council (2015) Wellbeing at the Bar

• We need to increase diversity and to influence antidiscriminatory cultures within our own staff and governance structures.


• We need to ensure our Future Bar Training

programme helps to create means of training which facilitate equality of opportunity for those with the right aptitude to join the Bar.

• We need to review our equality and diversity

commitments and action taken to date, such as the introduction of the Equality Rules and commitments to “positive action”133 approaches.

• We need to understand better the experiences of

barristers across areas including sexual orientation, race, disability, mental health and religion/belief, including the impact on wellbeing. If we identify problems, we will work with others to tackle them.

• We need to explore how access to justice is affected by equality and diversity issues and to explore any opportunities for improvement. Where good practice exists in the Bar, we should promote this.

• We need to learn more about best practice by

forming partnerships with a diverse range of internal and external stakeholders. This will help us to shape our future diversity objectives.

• We need to share our experiences and knowledge with other legal regulators and seek to learn from them.

133 The term “positive action” is introduced in Equality Act 2010, Chapter 2. The Equality Human Rights Commission defines it as “the steps an employer can take to encourage people from groups with different needs or with a past track record of disadvantage or low participation to apply for jobs”. Available at http://www. equalityhumanrights.com/your-rights/employment/applying-job/ positive-action-and-recruitment

57


• We want barristers to ensure that they fully

understand their regulatory responsibilities and comply with them. This includes exposing poor practices within chambers and reporting serious misconduct and discrimination to us.

• The Bar should promote good practice in equality and diversity practice, including the adoption of “positive action” approaches, and challenge bad practice.

• The Bar needs to improve its understanding of

how conscious and unconscious bias can lead to inequality of opportunity, and discrimination.

• Representative bodies, such as the Bar Council,

can work with us to develop strategies that influence positive anti-discriminatory outcomes within the profession and to build cross-cultural communication skills. They also have a role in promoting good practice

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Theme 3 Commercial pressures on providers Commercial pressures are a fact of life for many organisations, not least legal services providers. These pressures can stimulate innovation and creativity, enabling competitive advantages to be created, improving the consumer experience and potentially driving down costs. However, providers react to commercial pressure in different ways. Many respond positively, but others respond in ways that could lead to outcomes that harm consumers. This is usually because organisations find it hard to manage the pressure they are facing – especially if the commercial pressures are excessive. Sometimes, it can be difficult to acknowledge the extent of the pressure. At other times, a lack of knowledge can prevent providers finding appropriate solutions. Occasionally, providers may be driven to take inappropriate or reckless actions. In this risk theme, we look at the most significant causes of commercial pressure on the Bar and the outcomes that can arise: both good and bad.

Theme 3 in brief

• Whilst commercial pressures and interests do

not themselves constitute a regulatory issue (in fact they may stimulate positive growth and innovation), the potential negative impact these pressures have on the quality and coverage of legal services remains a concern for us.

• Commercial pressures that result in a

compromising of ethical principles, lowering of standards and/or unrealistic or hidden pricing in order to win business, may not be in the interests of those who rely on the market for quality advice, nor sustainable for providers.

• A significant proportion of those whom we

regulate have historically relied on publicly funded work. Cuts in government spending impact upon the Bar and its clients adversely. Some of the pressures identified have reduced the demand for or affordability of legal services. The amount of work available to the Bar in some areas has reduced.

• Other pressures involve the risk of increased

competition from alternative providers and certain clients having unrealistic – and sometimes possibly unethical – expectations of their lawyer.

• In line with our statutory economic growth duty,

we need to stay abreast of market developments and identify opportunities to remove unnecessary burdens. We need to support and encourage the development of a diverse and healthy legal services market.

• The Bar needs to understand, plan for and adapt

to the changing economic situation. It needs to maintain its focus on its Core Duties and identify opportunities to innovate.


Why we think this matters It is not the role of any regulator to safeguard the commercial interests of those it regulates. Commercial pressures do not of themselves constitute a regulatory issue and, in fact, providers entering and leaving the market can be a sign of healthy competition and a vibrant market. Commercial pressure in the market does have the potential to stimulate positive competition and innovation. It forces providers to find more efficient and attractive ways to stay competitive and do business. We believe that competition can ultimately help to bring positive benefits to consumers. However, commercial forces can be powerful and if not carefully managed, those pressures can have an adverse impact on the quality of services, availability of services and longer term sustainability. They may – in certain circumstances – even threaten professional independence and integrity.

The risks from our Regulatory Risk Index associated with this theme are: 1.1 Failure to provide a proper standard of service 2.3 Lack of independence 2.5 Conflict of interest 2.6 Lack of financial or administrative competence 4.1 Viability 4.6 Supply chain risks

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• A strong and healthy market for legal services offers consumers meaningful choice and access to legal help when they need it.

• The Bar is able to diversify and adapt in order to meet shifting consumer needs.

• The market for specialist advocacy services is vibrant and sustainable.

• Newly-qualified barristers have opportunities to develop their capabilities and to progress.

• High ethical standards are accepted as

underpinning, rather than being in tension with, commercial success.

• Effective regulators allow freedom of entry and exit

to the extent permitted by the public interest. For example, minimum entry requirements are set only at the level needed to ensure appropriate standards for consumer protection.

• Barristers and entities are only prevented from

leaving the market by rules that are necessary to protect consumers. This would include preventing an unmanaged departure happening mid-case and ensuring that appropriate insurance remains in place.

• Regulators will provide a flexible environment for

providers to innovate. They safeguard consumers against the potential adverse consequences of commercial pressure, whether these occur within individual practices, or within the justice system as a whole.

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Background In this section, we explore some of the reasons why the Bar may be feeling commercial pressure and the consequences of this for the regulatory objectives. We are aware that some of these reasons do not apply to every area of practice at the Bar. However, it is helpful for all barristers to have an understanding of the challenges faced.

Causes of commercial pressure Introduction of the Legal Aid, Sentencing and Punishment of Offenders Act The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) was enacted in April 2012. Its aim is to cut £350 million from the legal aid budget – alongside introducing other changes.134 These cuts have reduced the ability of consumers to get legal advice, with many now becoming litigants in person “because they were ineligible for or had been unable to obtain legal aid, but could not afford legal representation”.135 Cuts have also negatively affected the commercial viability of members of the Bar undertaking publicly funded legal aid work. The Bar Council’s survey of barristers one year after LASPO was introduced,136 revealed that over 80% of barristers undertook less civil legal aid work than before LASPO, including some who reported that they no longer undertook any at all. For criminal legal aid, the response was similar. The cuts may also have negatively affected barristers who might have acted for the opponents of those receiving public funding, because fewer cases have gone to court. LASPO and its associated orders also introduced changes to conditional fee arrangements (CFAs) and the extension of damages-based agreements (DBAs) from employment cases to the majority of civil cases. 134 House of Lords Constitution Committee (2011) Part 1 of the Legal Aid Sentencing and Punishment of Offenders Bill, 21st report of session 2010-12, HL Paper 222 135 Ministry of Justice (2014) Litigants in person in private family law cases 136 The Bar Council (2014) The Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO): One Year On


The changes to CFAs include the introduction of a cap on the success fee for personal injury and the recovery of this success fee from the client rather than the opposing (unsuccessful) party. The impact of these changes has included additional financial pressure on providers and the need to adjust how they manage the terms of the work they offer. The Bar Council’s report found that almost 50% of barristers using CFAs no longer charge success fees, with 60% of these barristers adjusting their base fees as a result. This change impacts on consumers, particularly those with lower incomes, who are now expected to pay a higher hourly rate for their barrister. This has more impact for those on lower incomes. In addition, the changes can mean that fees are now payable whether or not a case is successful. The provision in LASPO to extend damages-based agreements has had little impact. The Bar Council report also showed only 3% of barristers had used them. This suggests that there has been only a limited widening of choice around consumer financing for those instructing the Bar.

Changes in the court system The courts are currently in a period of significant change, as detailed in the regulatory context on page 29. This reform across civil and criminal courts seeks much-needed efficiencies, but will necessarily present challenges for the Bar and others in enabling and adapting to changes. For example, the extent of court closures and other challenges have reduced the amount of time barristers can spend providing legal advice in some instances. A further 86 court closures are currently scheduled to go ahead between February 2016 and September 2017.137 The rise in litigants in person in the court system has placed pressure on barristers, especially when they are representing the other party in a case. As a barrister

137 HM Courts and Tribunal Service (2016) Response to the proposal on the provision of court and tribunal estate in England and Wales/ HM Courts and Tribunal Service (2016) Potential implementation dates [for closure of courts and tribunals]


has an overriding duty to the court, it can mean that they find themselves providing additional assistance to the litigant in person, to ensure that the court can reach the correct decision. This could be on a point of law which affects the case. This has a cost implication, which either has to be met by the barrister or their client. In addition, it may seem to clients that their barrister is not acting in their best interests during proceedings. Finally, the increases in court and tribunal fees (across a wide range of different areas of law) have limited many consumers’ ability to seek redress for their legal problems. They are less able to afford the costs involved in having a matter heard. This has an impact on access to justice as well as on the Bar, which may receive less work as a result. For example, following the introduction of Employment Tribunal fees in 2013, claimants must now pay at least £390 for a simple case or £1,150 for a more complex case to be issued and heard. As a result, the volume of claims dropped by almost 75%. Even though the volume has now started to increase, it remains at about half the level of cases seen before the introduction of fees.138 In December 2015, the proposed criminal courts charge was dropped, but not before attracting challenge around the impact of such costs on the proper administration of justice.

Alternative providers of legal services The Bar faces increasing competition from other legal services providers, some of whom – such as solicitoradvocates – are regulated, and others who are not. Traditionally, the Bar has undertaken the vast majority of advocacy in courts. This is a reserved activity, known as “the exercise of a right of audience.” A barrister will usually be instructed through a professional intermediary – such as a solicitor. For many barristers, this happens through a chambers model: a clerk accepts instructions on behalf of the barrister. Since the 1990s, other lawyers, such as solicitors, have increasingly used their own rights of audience to 138 Ministry of Justice (2015) Tribunals and gender recognition certificate statistics quarterly: July to September 2015

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undertake advocacy in courts, including the higher courts. This has provided a source of competition for the Bar. The Jeffrey review stated that “between 2005-06 and 2012-13, the percentage of publicly funded cases in which the defence was conducted by a solicitor advocate rose from 4% to 24% of contested trials and from 6% to 40% of guilty pleas”.139 The review also estimated the number of solicitor advocates in 2014 at 11,000, of which nearly 5,000 had higher rights of audience. We understand that the number of solicitor advocates may since have increased further. This competition between the Bar and other lawyers is intensifying. Solicitors’ firms, in particular, are looking at new ways of appointing advocates from any professional background, rather than just instructing barristers. In June 2015, one law firm announced that it had developed technology that would enable it and other firms to instruct directly individual advocates for magistrates’ hearings and Crown Court appearances.140 This works by providing a platform where solicitors’ firms, police station representatives and advocates can see each other’s availability and advertise their own. It was suggested that the technology might “bypass chambers completely”. Another firm announced that it was opening its own “in house chambers”, consisting of barristers and solicitor-advocates.141 The advocates would be employees of the firm and would be taking instructions from other law firms. The Bar now has increased flexibility to respond to healthy competition. They can offer advocacy direct to the public (public access) and through new business models (entitybased regulation). As well as advocacy, the Bar also undertakes a wide range of other reserved and unreserved legal activities. For unreserved legal activities (such as legal advice or advocacy where rights of audience are not required), the Bar is experiencing competitive pressure from 139 Sir Bill Jeffrey (2014) Independent criminal advocacy in England and Wales 140 Solicitors Journal (2015) Exclusive: Leading criminal legal aid firm to sidestep chambers 141 Legal Futures (2014) Cartwright King launches first “in-house chambers”

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unregulated providers and professionals who are regulated outside of the Legal Services Act 2007. The Office of the Immigration Services Commissioner’s most recent annual report suggests they regulate 1,670 organisations providing immigration advice.142 The Legal Services Board estimates that “20-30% of turnover in the legal sector can be attributed to unregulated providers”.143 While competition is expected – and encouraged – it can be difficult for consumers to make an informed choice about providers in such a complex landscape and they may not realise that they are choosing a provider without the benefit of regulatory protections or an ombudsman service. If the Bar’s services are inaccessible and driving consumers to have to use alternative providers, this may pose risks to consumers. Research by the Solicitors Regulation Authority found that interviewees had a “general expectation that all providers within the sector would be regulated (in parallel with other sectors)” and there was a “degree of concern” when they were informed that the legal market has both regulated and unregulated providers.144 However, unregulated providers may be more easily able to cater for otherwise unmet need than those with regulatory requirements to meet. If this is the case, there may be benefits for consumers despite little direct competition between the two groups. There is the possibility that a new form of competitive pressure could become significant in the future. Organisations providing services to consumers which enable them to navigate parts of the legal system without needing a lawyer could offer new ways for consumers to meet their own legal needs. 142 Office of the Immigration Service Commissioner (2015) Annual Report and Accounts 2014/15 143 Taken from the Legal Services Board’s website: http://www. legalservicesboard.org.uk/Projects/Unregulated_Legal_Services_ Providers/index.htm 144 Solicitors Regulation Authority (2010) Research on Consumer’s Attitudes towards the Purchase of Legal Services


Providers, both regulated and unregulated, would need to communicate clearly the value of their service to these consumers if they want to provide legal services to them. Recent analysis by the Ministry of Justice identified 1,462 providers145 who provide advice and guidance for consumers on a not for profit basis, some of which will be focusing on supporting consumers who choose to represent themselves. The Courts & Tribunals system itself is also seeking to redesign its services to make them more accessible to those without a lawyer.

Influential clients There is a risk that the power held by influential and financially important clients increases significantly when the Bar is under commercial pressure and that this may threaten the independence of the Bar. This influence may be used to put members of the Bar under pressure to behave in a way which is not in the public interest or in the interests of justice. For example, there may be pressure to restrict a barrister’s freedom to act for or against certain clients in the future. The intermediary role traditionally performed by solicitors is also relevant to this risk. Our fear is that by trying to win and retain influential clients or intermediaries, some members of the Bar could resort to financial tactics that harm the wider public interest and threaten the Bar’s independence. In our call for evidence when considering changes to the standard contractual terms and cab rank rule, it was stated that the cab rank rule “had the real and important consequence of preventing financially important clients from stopping members of the Bar from acting against them in future cases”.146 This imbalance of power, whereby some clients could be in a position to dictate terms of contract, may threaten the independence of lawyers. Research released by the Solicitors Regulation Authority in 2015 explored some of the commercial

145 Ministry of Justice (2015) Survey of Not for Profit Legal Advice Providers in England and Wales 146 Bar Standards Board (2015) Annex A to Cab rank rule consultation: Summary of responses to call for evidence


pressures being placed on large law firms by their more powerful clients.147 These include:

• Contractual terms that heavily favour the client at the expense of the lawyer;

• Clients playing a “shadow” role in the law firm by

seeking to influence their relationships with other clients; and

• Clients imposing restrictions on who the law firm

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“The severe cut to the Legal Aid budget has placed individual tenants under considerable financial risk with, in some cases, consequent health risks.” 149 Our role as the regulator is to protect the public. While commercial pressures will affect barristers’ ability to meet their own business objectives, this pressure can also reveal itself in behaviours and actions that harm consumers and the wider public interest. We therefore need to be aware of any impact that these pressures might have on barristers’ practices.

can and cannot act for.

Quality of service There is a risk that these pressures could be passed onto the barrister by the solicitor. The cab rank rule ensures less influential consumers can still obtain representation. However, when barristers offer public access services, the cab rank rule does not apply.148 There is a possibility that if public access becomes more popular, powerful clients may instruct barristers and apply commercial pressure directly to compromise independence or integrity.

Evidence and consequences of commercial pressure Whilst we have identified several drivers of commercial pressures and can see some likely consequences, direct evidence of commercial difficulties themselves is limited as few are prepared to disclose them. However, we are confident the factors described above are having some impact on a significant number of barristers. Given the nature of some of those factors, this is not a universal picture across all areas of the Bar, with some more acutely affected by factors such as public funding cuts than others. We see the consequences of commercial pressures through the complaints we receive and the subsequent investigations and enforcement action we undertake. We also gain insight through our supervisory activity: as we were told by one chambers on their supervisory return in 2015:

147 Solicitors Regulation Authority (2010) Independence, representation and risk report 148 Bar Standards Board (2010) Public Access Work Guidance for Barristers

A natural response to decreasing revenue is to decrease costs. This is a response taken by all organisations in all industries. However, when these cost savings result in a poor quality of service, this has consequences for consumers. A reduction in quality may not be intentional and could arise even with the best of intentions. Situations that could lead to a poor service include:

• Rushing certain parts of a client’s case, for example, by conducting legal research quickly or failing to prepare properly ahead of a court appearance;

• Making mistakes due to overwork or stress; and • Failing to make reasonable adjustments for

disabled or vulnerable clients who need additional (sometimes more costly) support.

It is especially important that the Bar does not let commercial pressures impede its ability to identify and accommodate vulnerable consumers. The table on page 21 provides a selection of different indicators that can suggest vulnerability. The decision to diversify into new areas of work, perhaps as a strategic response to anticipated commercial pressures, poses challenges in delivering proper standards of service. Service may be stretched throughout a period of change, given the potential

149 See our website for more information on Supervision Returns.


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training requirements to build competency in a new area and amendments to processes and procedures required.

Use of referral fees Under LASPO, referral fees are banned for all legal service providers working in personal injury. Our Handbook also places a ban on all referral fees for the Bar and this has been a feature of barristers’ practice for many decades.150 We believe this to be in the public interest and that not having a ban would lead to the following risks:151

• Referrals would be made on the basis of willingness to pay a referral fee rather than the best interests of clients;

• Client choice will be correspondingly reduced; and • The independence of the Bar will be compromised. Yet, through supervising and talking with barristers we have identified some arrangements where there may be some confusion as to whether certain referral arrangements amount to a prohibited referral fee or not. Often, this will depend on the facts of the case and the underlying purpose of any referral arrangements. On the one hand, we do not seek to interfere with the Bar’s ability to strike a commercial bargain with solicitors or others who may refer work. However, we are concerned about arrangements that may incentivise decisions to refer work that are based on the payment of a fee or payments in kind rather than an assessment of what is in the client’s best interests. This is more likely to be problematic where there is a direct relationship between payments made and the number of referrals between people or where a payment is linked to (and a requirement of) a specific referral. The guidance published by the BSB lists a number of features which, when present, indicate that a payment may or may not be a prohibited referral fee.

150 Bar Standards Board (2015) Handbook 2nd Edition Section rC10 states: “You must not pay or receive referral fees”. 151 Bar Standards Board (2012) Consultation Paper New Handbook and Entity Regulation: Part One

However, members of the Bar must exercise judgment on a case-by-case basis to determine whether an arrangement is appropriate in the circumstances. Through our supervision and enforcement activity we will continue to monitor the impact that different referral arrangements have on the market and amend our rules or guidance if necessary. If we receive a complaint about a referral arrangement we will look at its purpose and impact on the client or wider regulatory objectives before deciding whether enforcement action is appropriate. The concern that “referral fees are being paid in order to secure instruction” has led to the government issuing a consultation considering a “statutory ban on all ‘referral fees’ in publicly funded, criminal defence advocacy cases”.152 In our response to the consultation, we supported this ban.153 However, we believe it should not be limited to only one area of work, as proposed. “The Bar has an exemplary ethical history but there are some trends that concern me because they could seriously dilute that sound ethical reputation. I have especially in mind the developing practice of effectively paying disguised commissions to solicitors for the provision of instructions to counsel.” Lord Carlile of Berriew, 2015154

Retainer fee arrangements Commercial pressure could lead to the Bar focusing on wealthier or regular clients to guarantee income. This may be a legitimate business strategy in some circumstances. However, it can compromise the independence of the barrister if the client seeks to influence them outside of their particular case. The use of retainer fee arrangements is a possible 152 Ministry of Justice (2015) Preserving and Enhancing the Quality of Criminal Advocacy 153 Bar Standards Board (2015) Response from the Bar Standards Board to the Ministry of Justice Consultation: Preserving and enhancing the quality of criminal advocacy 154 ResPublica (2015) In Professions We Trust


example of this and is something we are hearing about anecdotally. Retainer fee arrangements typically involve the payment of a fee by the client before the barrister has started working on their case. These payments may continue throughout the case, and after it has concluded. While these arrangements are not banned under our Handbook155, when they exist purely to prevent a barrister from acting for other consumers, they can breach the “cab rank rule” (which in certain circumstances requires barristers to act for any client if they are available) and compromise the independence of the barrister. This limits consumers’ access to specific advocates. Barristers need to be aware of the intentions behind a client proposing a retainer fee arrangement and ensure that the arrangement is justified for the legal work required.

Innovation and sustainability of the Bar Commercial pressures could have an impact on the long-term sustainability of the Bar. For example, increases in the number of alternative providers, and limited funds to provide pupillages (especially within the publicly funded Bar) can restrict access to the range of experiences that newly qualified barristers need to develop and progress. A natural response to these pressures is to innovate. This involves identifying new means of achieving objectives. It could include strengthening relationships with other organisations, expanding the range of services provided and building a solid client base. For the Bar as a whole, initiatives such as the online court for claims up to £25,000156 may reduce demand for the Bar – and other legal professionals – except for very specific or complex parts of their case. On the other hand, there may be opportunities for the Bar to provide new services exploiting or helping to build new technologies and applications. Those barristers who 155 Bar Standards Board (2015) Handbook 2nd Edition Rule C9.7 states “you must only propose, or accept, fee arrangements which are legal”. 156 Lord Justice Briggs (2015) Civil Courts Structure Review: Interim Report

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innovate to meet the changing needs of consumers may have a more sustainable practice. One specific challenge for the Bar to overcome here is its lack of investment historically in “dedicated IT resources and specialist information risk management” within chambers.157 As a regulator, we have a duty to promote growth in the legal services market158 and to protect and to promote the public interest. As such, we want to encourage and enable innovation as much as possible, as this benefits both the Bar and consumers. Innovations we have already seen at the Bar include:

• Barristers marketing their services directly to

clients and offering them potentially at a lower cost than if a solicitor acted as a professional intermediary;

• Barristers, or entire chambers, specialising in new areas of practice;

• Public access work, including unbundling of

services where responsibilities are shared between barrister and client;

• Offering different pricing and funding models to clients, such as fixed fees;

• Chambers restructuring the fees that barristers pay as members;

• Splitting chambers into two or more departments that each have some autonomy in the way they work; and

• Using outsourced clerking services or marketing agencies to manage, or increase, the referrals to chambers.

157 Bar Standards Board (2015) Report on High Impact Supervision Returns 158 Department for Business and Innovation (2014) The Regulators’ Code & Section 108, Deregulation Act 2015


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It is important that the Bar consider the risks present when innovating. New ways of delivering services require careful planning and delivery and an awareness of how they impact on consumers and other stakeholders.

The role of the regulator Our role in relation to the risks and issues arising from commercial pressures on providers involves:

• Collecting and disseminating evidence about the

market and how it is changing. This means taking account of the varied experiences of different sectors within the Bar;

• Carefully balancing the freedom and flexibility for

the Bar to innovate with the regulatory protections needed to ensure adequate quality of services;

will do this in a way that ensures we identify first and foremost with the interests of the public whom we have a duty to protect, rather than the interests of those we regulate.

• We will identify opportunities to remove market

restrictions or regulatory burdens which are not justifiable or a proportionate response to the risks posed.

• We will aim to encourage the Bar to approach the

changing market conditions with an open mind. We will help the profession to retain its core strengths and values, because we think this is in the public interest.

• We will set future education and training

requirements that better equip the Bar to adapt to a changing market.

• Understanding when it is appropriate for us to


• Safeguarding consumer interests in specific cases

• Always adhere to the core professional duties and

intervene in the operation of the market, and when it is not; and

where they may need protection from poor quality or disrupted provision of services.

What we need to do Having described our role in this area above, the following are areas of activity for us in taking forward this theme:

• We will ensure we remain knowledgeable about

practice at the Bar and stay abreast of market developments. We will focus on the risks to our regulatory objectives as distinct from commercial concerns for any particular provider.

• In line with our economic growth duty, we will work with the profession to support and strengthen the Bar’s ability to innovate to meet clients’ needs. We

standards set out in our Handbook irrespective of any commercial pressures you may be facing.

• Understand, plan for and adapt to the changing

environment. Alongside commercial pressures, there will be opportunities to innovate and grow.

• If diversifying into new areas of work, ensure that

appropriate changes to procedures are made and that the levels of competence of those involved in delivery of new services are appropriately maintained.

• Ensure that anyone exiting the market does so in

an orderly fashion and that clients are aware of the implications for them.


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Let us know what you think Thank you for reading our Risk Outlook. We hope that you have found it interesting and informative. As stated at the beginning, this Risk Outlook is merely a snapshot in time as at publication in April 2016. We expect to issue updates and further insight papers whenever anything changes significantly. We will publish these updates on our website and announce them via social media. You can follow us on Twitter: @barstandards. We communicate regularly with all those we regulate. One way in which we do this, is via our monthly “Regulatory Update” email to the profession. We will announce any policy or rule changes which may arise as a result of the issues identified in this Risk Outlook via this monthly email and on our website. If you have any comments about any of the issues that we have raised, or can share useful evidence or insight on these topics, we would like to hear from you. Please get in touch at [email protected]

What to look at next Take a look at our Regulatory Risk Index which sets out the risks that we manage using this approach. If you want to know more about our risk priorities and context in which we regulate, read our Regulatory Risk Framework. Both these publications are available on our website.

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Contact us If you have questions about our risk-based approach, or would like to provide with information about any specific risk concerns that you have, please do get in touch with us. Write to us: Bar Standards Board 289-293 High Holborn London WC1V 7HZ Phone us: 020 7611 1444 Fax us: 020 7831 9217

[email protected] www.barstandardsboard.org.uk @barstandards www.linkedin.com/company/the-bar-standards-board

APRIL 2016