LSB looks to improve complaint handling and foster innovation

The Legal Services Board (LSB) has outlined new measures aimed at improving the handling of initial ‘first tier’ consumer complaints so that they are “dealt with promptly and as close as possible to source”.

This followed LSB research which found nearly half of complaint cases escalated to the Legal Ombudsman were found to have been handled inadequately at first stage and that 30% of complaints to the Legal Ombudsman were made prematurely, before the first-tier process had been exhausted.

According to the LSB guidance issued by in May, initial complaints made to legal services providers should ensure consumers feel empowered, know their complaint will be taken seriously, and that their feedback will be used to improve services. Complaint procedures should be easy for users to find and to make in a manner of their choosing, and updates on progress should be given. 

Regulators are required to put in place “the best possible complaints resolution system for legal services users by using information and intelligence gathered from first-tier complaints and second-tier complaints” and to foster “a culture of continuous improvement and learning from complaints and feedback.”

Alan Kershaw, chair of the LSB, said that too many people experienced challenges in having their complaints dealt with fairly and promptly. “Often this is because it is not clear how to complain or they feel they come up against a wall of silence,” he explained.

“The process should be clear, easy and as stress-free as possible. Addressing complaints promptly is not just about resolving issues; it’s good for business too. By tackling grievances early on, we prevent them from escalating into resource-intensive problems down the line. This proactive approach not only fosters better customer relationships but also enhances a competitive edge in the market and reduces the need for a regulator to become involved.”

In separate guidance, the LSB is pushing the frontline regulators to be proactive in creating an environment that enables legal services providers to be more innovative in how they connect people to legal services.

LSB research showed videoconferencing was still relatively new to many firms and that less than a third had interactive features such as a chat function on their website. At the more advanced end of the scale, only 2-5% of firms used innovations such as blockchain, tech-assisted review, or robotic process automation.

The statutory guidance published by the LSB in April stated that regulators must ensure regulation “enables the use of technology and innovation to support improved access to legal services and to address unmet need” and that it balances the benefits and risks as well as the opportunities and costs of technology and innovation “in the interests of the public and consumers”.

Regulators should also work to actively foster a regulatory environment that is open to technology providers and innovators.

Mr Kershaw highlighted the role technology has to play in tackling the unmet need for legal services, saying there was a real opportunity to address the problem by fostering an environment that not only supported but actively encouraged innovation in the market.

“Our guidance puts beyond doubt the LSB’s commitment to ensuring regulation does not hold back innovation whilst recognising that regulators must continue to be alert to the risks,” he said. “From AI to videoconferencing, we want the sector to embrace technology and innovate to better connect people to legal services.

“We now expect the regulators to embrace our ambition and move with appropriate pace to understand the public’s needs and develop frameworks that balance the benefits and risks in the interest of people who need legal services.”

You can read about CRL’s approach to AI in this edition of the Journal