Training for success

Businesses increasingly recognise the role of training in their continued success and development. The argument, that when you make a commitment to training you ensure that you/your employees learn the necessary skills to work safely, efficiently and cost-effectively, is widely acknowledged.

Solicitors, in common with most other professionals, are now required to undertake significantly more formal training than has ever been required in the past. Long after the law degree, the Diploma of Legal Practice, and the Professional Competence Course are successfully put behind them, solicitors still must undertake a minimum of 20 hours’ continuing professional development annually in order to continue in practice.

In the lifetime of training that a solicitor now receives, one might query how much is given over specifically to risk management? With professionals facing an increasingly complex and challenging environment, including a culture of increasing claims against them, there is a sound business case for raising awareness of risk issues and risk management measures though dedicated risk management training.

How do you raise your/your practice’s awareness of risk issues and reduce the risk of costly claims? Consider the following action points:

1. Plan your training

When reviewing or developing a training plan for yourself or your firm, you should consider:

• What are the training needs you need to satisfy?
• What form should that training take? Can it be provided in-house, or is it best addressed by external trainers? What training medium would be most effective, given any time and cost restraints?
• Does the existing/proposed training satisfy the defined goal or objective?
• Can any procedures or follow-up to training increase the effectiveness of that training?

If you are the person responsible for training in your firm, you may also wish to consider:

• How will members of the firm apply the training?
• How is this being monitored?
• How are people being selected for particular training events?
• How is cost effectiveness going to be measured?

Training needs can be identified by a number of means. File audits, appraisals and supervisory reviews may highlight development needs of an individual or identify gaps in the application of existing procedures. An analysis of claims and complaints may, on the other hand, reveal instances where the necessary risk mitigation procedures are simply not in place.

Incorporating risk management within your annual training plan can help address lack of awareness of risks, help improve compliance with existing procedures, and help with the effective introduction of new systems and procedures.

An outline training plan is available on the Marsh solicitors’ website. This details some of the risk management training available to the profession, and suggests who in the firm might benefit from the training (and how often). This can be used as one of the steps towards establishing a comprehensive annual training programme for partners and staff, and equally gives individual solicitors an “at a glance” guide to the risk management training available.

2. Keep up to date

If you are reading this, the chances are that you already follow that advice – but perhaps you do not recall some of the other articles over the past year or so?

The risk management articles in each Journal are specifically targeted to address:

• significant current risk issues (e.g. fraud risk, potential break notice defects)
• perennial procedural matters and client engagement and communication issues which continue to feature in the claims experience.

These articles are designed to raise awareness of a wide range of risks and provide practical advice on how to mitigate those risks. When taken as a whole, they can inform, and perhaps even form the basis of, a risk management strategy and risk management training plan.

The panel below provides a résumé of some of the risk issues addressed in the Journal over the last year.

Consider signing up for relevant e-bulletins. The Law Society of Scotland’s e-bulletins regularly flag risk issues of particular relevance to your area of practice (for example in April last year an e-bulletin was issued highlighting the danger signals for identifying possible identity fraud by clients).

3. Take advantage of available training

Seminars and workshops

A range of training resources are available from Marsh.

In addition to the events run by Update as part of the Society’s CPD/training programme, Marsh can provide seminars or workshops addressing a variety of practical risk issues. These are available on request (generally free of charge), subject to availability.

The workshops use case studies based on the claims history of the profession as a whole and risk issues concerning insurers, to raise awareness of possible risks – and, more importantly, consider practical ways in which such risks can be mitigated.

Online resources

The Law Society for Scotland website contains a range of practical guidance on a range of risk management issues.

Marsh have launched four e-learning programmes, each providing between half an hour and an hour of CPD, accessible via the Marsh Scottish solicitors’ website: www.marsh.co.uk/lawsociety.

The four interactive e-learning modules currently available (more are in the pipeline) are:

Module 1: Introduction to risk management. This introductory module provides a brief summary of what risk management is and why it matters. As well as illustrating the problems which can arise where good risk management procedures are not embedded in the office culture, the module raises awareness of business benefits which an effective risk management strategy can bring. Case studies provide practical illustrations of some common transaction risks, and focus on the effective reduction of the most significant risks.

Module 2: Client and transaction vetting. Taking on new work and new clients is vital to the health of your business. The danger is that, particularly when times are tight, it is easy to drop your guard when it comes to vetting possible new instructions, where there is the temptation of a seemingly attractive piece of new business.

Through the use of a range of materials including practical case studies, the Client and Transaction Vetting module raises awareness of the importance of applying effective vetting procedures, highlighting the risks which may otherwise lead to claims, complaints and lost fees. The course also identifies procedures and behaviours to help you get the most benefit from your vetting process.

Consider what vetting issues arise in the following case study:

Nifty & Co handle mainly domestic property work but do take on occasional commercial property transactions. One of Mr Nifty’s clients approaches him about the opportunity to get involved in a major property development. It is a particularly high value transaction but the work involved seems relatively straightforward.

Is there any reason Nifty & Co should hesitate before taking this on?

For an answer to this question, and a more detailed discussion of the requirements for effective client and transaction vetting, visit the Marsh Scottish solicitors’ website and log onto the Client and Transaction Vetting e-learning module.

Module 3: Terms of engagement. It is clear from discussions at risk management workshops that terms of engagement are increasingly recognised as being a vital risk management tool. The single biggest source of claims against solicitors each year is poor communication: whether it be misunderstandings as to the scope of work, failure to clarify instructions, or a lack of clarity in the allocation of responsibilities between the client and the solicitor. Terms of engagement are the foundation on which clear and effective communications can be built.

What also seems apparent is that, following exposure to the experiences of other solicitors regarding the drafting of terms of engagement, a number of solicitors are reviewing the drafting in their own terms of engagement to address particular risk issues which have been identified.

The Terms of Engagement e-learning module suggests examples of suitable wording addressing a number of such issues, including managing client communications, setting out fee arrangements and identifying likely timescales for the work.

Regular refresher training for fee-earners can help ensure that the firm’s terms of engagement procedures are being properly implemented.

Module 4: Critical dates and timescales. Failure to comply with critical dates and deadlines is responsible for claims in every practice area, not just litigation. Claims are not infrequent, and can be costly. There are instances of critical date-related claims resulting in seven figure settlements.

Marsh’s latest e-learning programme follows the history of a particular personal injury claim to see where critical dates can arise – sometimes unexpectedly – and then considers how critical dates and timescales impact on other practice areas through a range of interactive case-study based exercises.

The module considers how critical date claims arise, and suggests a range of procedures and practical risk controls to address those particular risks.

4. Visit the Marsh website for Scottish solicitors

In addition to our e-learning offerings, the Marsh Scottish solicitors website contains a wealth of additional information relating to the Master Policy, a range of insurance matters relevant to solicitors, and a variety of risk assessment and risk management materials.

Marsh’s website for solicitors can be found at www.marsh.co.uk/lawsociety

If you do not know your firm’s password (required to access the site), either contact your risk management partner for details, or contact Marsh (contact details below).

Calum MacLean and Marsh

Calum MacLean is a former solicitor in private practice who works in the FinPro (Financial and Professional Risks) National Practice at Marsh, the world’s leading risk and insurance services firm. To contact Calum, email: calum.maclean@marsh.com

The information contained in this article provides only a general overview of subjects covered, is not intended to be taken as advice regarding any individual situation and should not be relied upon as such. Insureds should consult their insurance and legal advisers regarding specific coverage issues.

Marsh Ltd is authorised and regulated by the Financial Services Authority.