Workplace Culture – the SRA Goes Public

Workplace Culture

Workplace culture and mental health issues have been the subject of debate for some time.  One of the triggers for this has been a series of high profile cases in which young solicitors were struck off for dishonesty. The circumstances surrounding their employment were examined in some detail by the Tribunal and revealed a lack of support, poor supervision, bullying, long working hours, extreme pressure to achieve billing targets and disregard for mental health by the employing firms. The Tribunal identified what it described as a “toxic workplace culture” amongst some firms.

That this subject was taking root when the SRA’s new rules were published in 2019, is evidenced in the SRA Code of Conduct for Firms (“the Code for Firms”) which begins with an aspirational statement which says that its standards and business controls “aim to create and maintain the right culture and environment for the delivery of competent and ethical legal services to clients”. What the “right culture and environment” might look like has, however, been unclear and this lack of clarity had been reinforced by an apparent reluctance on the SRA’s part to take action against firms that operate these so called toxic work environments.

All this might be about to change with the publication on 7 February by the SRA of three documents on the subject of workplace culture. This may be the time, therefore, for firms to start thinking about how well they support their staff and the supervision arrangements they have in place. The three documents are:

• Guidance entitled “Workplace environment: risks of failing to protect and support colleagues”.
• Case studies which give some indication of the circumstances in which the SRA is likely to take action and how it approaches dealing with complaints concerning workplace culture.
• The results of an SRA “Workplace Culture Thematic Review”. This review draws evidence from several sources, notably LawCare’s “Life in the Law”, which was a major study which analysed responses from over 1700 individuals about their experiences of workplace culture. It sets out examples of good and bad behaviour and is intended to help firms reflect on their own culture and to identify strategies they could put in place to make improvements.

SRA Workplace Environment Guidance

One of the problems the SRA has had in taking action against firms with poor workplace environments has been linking its aspirational statement which prefaces the Code with the rules. Firms can only be disciplined for breaches of the rules – not failure to achieve aspiration. The guidance, therefore, aims to provide the link and sets out which rules are likely to be breached, and why, where workplace culture is poor. It makes clear that it is targeted at managers and those within “senior leadership” in firms and other organisations delivering legal services. It gives a clear message that it is those at the top who have responsibility for setting the right culture. It also encourages individuals to report to the SRA issues of bullying, harassment, discrimination and victimisation in their workplace.

It starts, however, with a broad statement about those behaviours which, it says, will help ensure compliance with the rules. These are :

• having effective systems and controls to supervise staff, and monitor concerns which may affect their wellbeing and competence;
• providing a safe environment for employees to raise concerns and addressing them promptly and in a constructive manner. Firms should also be aware that poor performance by an individual could be a warning sign that an individual is working under stress or duress;
• treating staff with dignity and respect to create an ethical workplace and ‘engaged’ employees thus creating a better client experience; and
• having in place and implementing policies on bullying, harassment, discrimination and victimisation as well as disciplinary procedures for breach of those policies.

This is nothing new and follows guidance from others, notably LawCare. It does, however, provide a clear tick list for firms to reflect on and to use as a basis for setting the right culture in which employees can give their best.

The guidance then highlights how it will link failures in relation to these behaviours to rule breaches. The rules highlighted are these:

• Paragraph 2 of the Code for Firms, dealing with the need to have effective governance structures, arrangements, systems and controls. This includes monitoring and managing risks to the business.
• Paragraph 3 of the SRA Code of Conduct for Solicitors, RELs and RFLs (“the Code for Individuals”) and paragraph 4 of the Code for Firms and the need to demonstrate competence and effective supervision. Managers and employees are required to be “competent” to carry out their roles. The SRA guidance addresses this to an extent. It says that “at the very least, firms have in place arrangements to regularly monitor and assess employees’ workloads and capacity as well as their competence to do the work”.
• Principle 6 of the SRA Principles and the need to act in a way that encourages equality, diversity and inclusion. The guidance ties this to issues such as treating employees fairly and with dignity and notes that this includes creating an environment that is “inclusive and free from discrimination, bullying, harassment or victimisation”. It makes clear that part of this is that employees are confident that complaints of discrimination, bullying, harassment and victimisation will be dealt with by firms promptly, fairly, openly and effectively.

This should not be regarded as an exhaustive list but sets out where rule breaches are most likely to occur.

To give a bit more clarity about situations in which the SRA will take action, it sets out situations where this is likely. These include:

• a pattern of abuse of authority by senior staff that has been left unchecked by the firm,
• a complaint of discrimination, victimisation or harassment not dealt with by the firm in a prompt and fair manner,
• complaints of bullying raised with the firm over a period of time involving a number of staff and inadequate action taken by the firm as a result; or evidence that the incidents had not been brought to light sooner because of the firm’s culture and/or inadequate reporting and disciplinary procedures,
• a firm pressurising staff to withdraw their complaints,
• ineffective systems and controls, including failure to supervise or support staff leading to serious competence or performance issues or delivery failures, and
• the imposition of wholly unreasonable workloads or targets.

These all tend to be patterns of behaviour rather than one-off incidents and would tend to indicate ongoing poor management and failure to grasp the nettle where there are issues that fester. They are helpful in indicating where the rules are likely to bite.

SRA Case Studies

There are only three which suggests the SRA is just beginning to develop its approach to dealing with these issues. They make an interesting read with just one leading to disciplinary action in the form of a regulatory settlement agreement. In that particular case a newly qualified solicitor was found to have been given an overwhelming number of cases which were beyond their expertise and had resulted in numerous complaints from clients. A breach of Paragraph 4 of the Code – failure to support and supervise staff – was found.

Solicitor Workplace Culture Thematic Review

This review draws evidence from several sources, notably LawCare’s “Life in the Law”, which was a major study which analysed responses from over 1700 individuals about their experiences of workplace culture. It sets out examples of good and bad behaviour and is intended to help firms reflect on their own culture and to identify strategies they could put in place to make improvements. It provides good background reading to the guidance.

Conclusions – SRA and Workplace Culture

It seems evident that the SRA has laid down a marker that it will look more closely at how firms treat their staff in terms of supervision, workloads and support generally. Apparent failings in this regard will be viewed from the perspective of a firm’s overall management – particularly at the higher levels – its policies, systems and procedures, the way it treats its staff and the actual supervisory arrangements that are in place. Although this does not let those employees off the hook who fail clients, it does encourage them to report their firms if they do not pay attention to these important management issues.

The extent to which the SRA will get stuck into the whole issue of workplace culture and bring about real change is yet to play out. It will be interesting to see how this develops over the coming year. Related to this is an in depth look at how competence should be measured in lawyers and law firms currently being undertaken by the LSB. It wants to see measurable outcomes demonstrating competence and this is set to embrace wider issues such as managing workplace environments. It seems likely that this will lead to possible rule changes and further guidance. Watch this space!