1 year on from OFR's introduction, and the SRA are reviewing the regulatory burden imposed on firms.
SRA plans to drop 16 hours CPD Requirement
In contrast to the the introduction of OFR last year, which many law firms considered as increasing the burden on solicitors, the SRA have announced proposals, which if passed today, will lead to the removal of the mandatory minimum CPD requirement of 16 hours per annum.
There is a well-recognised problem that the current CPD regime facilitates a 'tick-box' approach to CPD learning, without any real tie in to solicitors specific needs. The approach being proposed by the SRA is somewhat controvertial however, and astark contrast to the approach taken by the Law Society of Scotland - whose members retain a 21 hours per annum CPD requirement, which must be verifiable, and tied to annual development needs.
The plans are due to come into force in November 2016, although accreditation of CPD will cease from November this year. Clearly the intention is not that firms should stop training their staff - but there is a danger that small firms, already without the resources to undertake training in-house, may simply cease providing training for staff altogether.
Law Society chief executive Desmond Hudson has criticised the plans, saying: 'At a time when it is almost universally accepted that undertaking CPD is the mark of a professional, the abolition of the requirement may send the wrong signal to employers and clients.'
SRA Regulatory Proposals remove red tape, but increase COFA responsibilities?
Under OFR, your firm's CoFA was required to report material breaches to the SRA as and when they occurred. One of the less reported changes proposed by the recent series of SRA Consultations would remove the requirement for an independent report from an Accountant/Auditor, and instead, the COFA would be required to sign a declaration that they are satisfied that the firm is complying with the SRA Account Rules with regard to the management of client accounts.
This may reduce the cost of compliance for smaller firms, although many firms will choose to continue to use the services of an Accountant to assist satisfy their compliance requirements in this regard.
To have your say, respond to the SRA Consultation by 18th June.
SRA investigate failures in PII disclosures by law firms
The SRA's supervision and enforcement teams are investigating more than 80 firms which failed to disclose their insurance status after the 1st October renewal deadline, according to a report in the Law Gazette today.
The work is being carried out by the SRA's supervision and enforcement teams and relates to firms that did not inform the regulator about their full insurance status after the 1 October renewal deadline passed.
The SRA is also undertaking a project to revoke the practicing certificates of solicitors where major non-compliances have not been addressed. of the 2013/14 practising certificate revocations enforcement project.
While over 130 firms closed at the end of the extended indemnity period (EIP) on 29th December, the SRA has intervened in two firms which were still trading without insurance after the EIP.
Do you have concerns regarding your firm's PII, or the proposed changes to solicitors' regulation?
Lockton can assist you ensure that you are best placed for PII renewal this October. Despite coverage in the press about the difficulties of obtaining insurance with rated insurers, the vast majority of firms are still able to secure good terms from an insurer with a strong financial rating.
We recognise that regulatory compliance is a significant issue for many firms, and the recent SRA consultations are endeavouring to address some of the criticisms made by smaller and medium-sized firms in particular. Whether the proposed solutions will have the desired consequences is more open to question - as Des Hudson's comments reported in Legal Futures magazine this week, clearly evidence.
We would encourage firms to contribute to the consultations. Alternatively, if you wish to flag a particular issue for discussion, please contact us - as we are seeking to collate a range of issues for debate prior to the consultation closing on 18th June.