SRA Issues First Fixed Penalties For Fee Transparency Non-Compliance

Is your law firm’s fees/prices page/section up-to-date and compliant with the SRA Transparency Rules? If it’s not, you might want to address the issue swiftly, as the SRA has issued the first fixed penalty notices against firms that have not met compliance regarding the transparency rules in relation to fees. According to the Law Society Gazette (LSG), three legal practices have recently been fined £750 each for failing to publish information on costs, service levels and the credentials of lawyers who would be instructed.

Paul Philip, chief executive of the SRA, told LSG:

“Compliance is clearly not optional. Our transparency rules are there to benefit the public, helping people compare law firms’ services and make informed choices. All those firms that are publishing the correct information rightly expect that we will take action against those who don’t.

“We brought in fixed penalties so we could deal with non-complex breaches of our rules more swiftly. That saves everyone time, cost and stress. It also appears that the threat of fixed penalties is proving effective in bringing firms into compliance.”

Read on to find out the basics of complying with the SRA’s transparency rules related to pricing.

What are the SRA Transparency Rules?

The SRA introduced the Transparency Rules on 6 December 2018. There purpose was to assist potential clients in making informed decisions about legal services. All regulated law firms and sole practitioners must set out their complaints procedure, plus their prices and services if they practice in the following areas of law:

• Conveyancing (residential)
• Probate (uncontested)
• Motoring offences (summary offences)
• Immigration (excluding asylum)
• Employment tribunals (unfair/wrongful dismissal)
• Debt recovery (up to £100,000)
• Licensing applications (business premises)

What does the fees page on my law firm’s website need to contain?

You need to include the total cost of a particular service. If this is not possible, you must state an average cost or a range of costs. And don’t forget VAT – not only whether it is included, but the rate that applies.

The basis for your charges is also important – you need to make clear which part of the service is provided on an hourly rate and situations where fixed fess apply. In addition, you must set out all likely disbursements that may relate to a particular practice area.

It is vital to note that setting down pricing is not enough to meet compliance. The prospective client must clearly be able to identify what they will get for their money. Therefore, you must publish:

• The services covered by the stated fees,
• How long a matter normally takes, and
• The people in your firm who specialise in the particular practice area, their biographies, and their general and specialist experience.

Although it is not essential, it is good practice to include the time frame, services, and pricing for a common legal matter so potential clients can see how the pricing works in a practical setting. What is important is that your law firm’s pricing is clear and illustrated using simple language, similar to the example below.

Example of an employment law pricing page

Our Employment law department has over [insert number of years] of collective experience in delivering high quality work in all matters relating to Employment Law. They have particular expertise in Employment Tribunal claims (representing Claimants and Defendants).

We have two Employment Law partners who may work on your matter [insert names and profiles].

We provide and charge for the following services

• Receiving initial instructions, reviewing any applicable documents, and providing legal advice at the outset.
• Drafting or reviewing Employment law-related contracts.
• Reviewing and advising on certain employment law matters such as redundancy, whistleblowing, and discrimination policies and procedures.
• In cases involving Employment Tribunal claims we charge for: taking initial instructions, preparing the ET1 form, dealing with ACAS early conciliation, dealing with ET3, preparation witness statements, preparing schedule of loss preparing case management hearing, and advising and representing you at a full hearing.

This is not an exhaustive list. The work we carry out on a particular case depends on the issues involved and the particular facts of the matter.

How long will my matter take?

The timescales from taking your initial instructions to resolving your matter depends largely on the stage at which your case is settled.

If a settlement is reached during pre-claim conciliation with ACAS, your case is likely to take up to [insert number of weeks].

If your claim proceeds to a Final Hearing, your case is likely to take [insert number of months] depending on the time estimate for hearing and availability of the Employment Tribunal at which the claim will be heard. Where a separate remedy is listed, this can add a further [insert number] months to the above estimates.

We will be able to give you a more accurate timescale once we have more information and as the case moves forward.

Non-contentious employment law matters, for example, drafting an Employment Contract, may take up to [insert number of days/weeks].

Our fees for employment law

Type of fee: Our fees for employment law matters are set out as follows: –

Fixed fees: No win, no fee agreement
Private hourly rate agreement

Fixed fees

Generally speaking, our fixed fee for employment cases is set between [insert fixed fee]  + VAT depending on the nature of the matter and the work involved.

Hourly Rates

Our hourly rates for all including employment are as follows: –

Partners and Solicitors with over 8 years’ experience: [insert rate] per hour + VAT

Partners and Solicitors with over 8 years’ experience: [insert rate] per hour + VAT

Assistant Solicitors with over 4 years’ experience: [insert rate] per hour + VAT

Trainees/Paralegals/Legal Assistants: [insert rate] per hour + VAT

Likely disbursements

Disbursements are costs related to your matter that are payable to third parties, such as barrister fees. We handle the payment of the disbursements on your behalf to ensure a smoother process.

Example of the cost of bringing or defending an unfair or wrongful dismissal claim

Each case is unique and in our initial consultation, we will provide an estimate of the services we will need to provide to achieve the result you want.

 On average, most employment law matters take between [insert number of hours] to complete, depending on the complexity of the case. This means that on average costs are between [insert fees] plus VAT.

The exact number of hours it will take will depend on the circumstances of your case, such as:

• If it is necessary to make or defend applications to amend claims or to provide further information about an existing claim
• Defending claims that are brought by litigants in person
• Complex preliminary issues such as whether the Claimant has a protected characteristic under the Equalities Act 2010 (if this is not agreed by the parties)
• The number of witnesses and documents
• If it is an automatic unfair dismissal claim e.g., if you are dismissed after disclosing your pregnancy

The services covered by the fees include:

• Taking initial instructions
• Preparing the ET1 form
• Dealing with ACAS early conciliation
• Dealing with ET3
• Preparation of witness statements
• Preparing schedule of loss
• Preparing case management hearing
• Advising and representing you at a full hearing.

This is not an exhaustive list. The work we carry out on a particular case depends on the issues involved and the particular facts of the matter.

Wrapping up

The above example has been created using the SRA’s official guidance on drafting a fees page. When writing your fees page, a good rule to follow is – if in doubt, don’t leave it out!

The SRA is undertaking random spot checks on law firm websites to ensure the firm has complied with the transparency rules. To avoid a nasty fine and being named and shamed, have a quick check over your pricing and complaints pages and check they are compliant with the guidance. If you require any help or need your fees page drafted, please do not hesitate to contact us.

To find out more about how our team can assist with all SRA compliance matters, please email us at [email protected] or phone 0121 249 2400.

The content of this article is for general information only.  It is not, and should not be taken as, legal advice.  If you require any further information in relation to this article, please contact 43Legal.