Gaining Vital Insights from Client Complaints
We have previously written about the regulatory focus on complaints handling, first on the Legal Ombudsman’s proposed reforms and then on the SRA’s supplementary consultation on first-tier complaints. Both articles focused on what the rules are changing and the heightened scrutiny on the way. This article looks at something less obvious but arguably more important: what the SRA does with complaint data once it has it, and what your own firm can learn from analysing the same information.
Most firms see complaint handling as an obligation and an added administrative burden. A client complains, the firm responds, the matter closes, and the file goes away. However, the SRA views it differently, and expectations on how complaints are handled and recorded are increasing. Complaint volumes, categories, resolution rates, and escalation patterns are supervision data. They tell the regulator which firms are generating problems, what kind of problems, and whether those problems are being managed or simply accumulating.
That is not a speculative reading. The SRA collects first-tier complaint data from firms through the annual regulatory return, and the Legal Ombudsman’s own published data on escalation rates and handling quality sits alongside it. A firm with a high volume of complaints that are resolved quickly and rarely escalate looks very different from a firm with a lower volume but consistently fails to issue a first-tier response. Even with a lower complaint volume, it’s the latter that is more likely to attract attention.
Making sure every complaint reaches a clear first-tier response and evidence it, is one of the areas our Outsourced Complaint Management Service is built to handle.
The Valuable Complaint Data Firms Are Sitting On
The record every firm must maintain under the SRA’s complaint handling rules captures more than individual grievances. Taken together over twelve months, it shows important patterns that are worth monitoring.
Are the complaints clustered in one department, or spread across the firm? Do they point to a particular fee earner, or a particular type of work? Are the same issues recurring- delays, poor communication, unclear costs- or is each complaint a one-off? Is the firm resolving complaints at first tier, or are they drifting to the Ombudsman? And when changes were made in response to previous complaints, did the same problems stop appearing?
The answers to those questions are crucial management information. A firm that reads them is running a feedback loop. A firm that files them meets a regulatory requirement but learns nothing from it.
This is where the compliance team who knows how to read it properly makes a difference. The COLP or the person responsible for complaints is in a position to see what individual fee earners cannot: the pattern across the firm, the recurring cause, the department that keeps generating the same issue quarter after quarter. That overview is the value of the data, and it exists only if someone looks at it as a whole rather than closing each complaint in isolation.
What the SRA Looks For
When the SRA reviews complaint data, whether through its annual collection, a desk-based review, or a supervisory visit, it is looking for several things.
- Volume relative to the size and type of work the firm does. A high-street firm handling 500 conveyancing matters a year will generate more complaints than a boutique commercial practice. While that is expected, what matters is whether the volume is proportionate, what lessons are being learned, and whether new policies or procedures are being put in place in response.
- Escalation rate. How many complaints reach the Legal Ombudsman, and of those, how many result in a finding that handling was poor? The OLC’s own data shows that in the first three quarters of 2025-26, complaint handling was found to be poor in 46% of the complaints investigated. That figure is a regulatory baseline. A firm that sits well above it has a problem the SRA can see.
- Evidence of learning. Can the firm point to changes it made in response to complaint trends? A new process, a training session, a change to how client expectations are managed at the outset of a matter? This is where the data turns from a record into a defence. A firm that can show it identified recurring issues and acted on them is demonstrating effective governance. A firm that cannot is demonstrating that the complaints policy exists on paper, but it is not being implemented in practice.
Using the Data Rather Than Just Keeping It
The practical shift is relatively small, but it changes the mindset for a firm’s senior management, supervisors, and compliance officers. Instead of treating complaints as individual cases to be closed, treat the aggregate data as a standing item for senior management.
Report complaint trends to the partners or board at least quarterly. Include the categories, the departments, the outcomes, and whether previously identified issues have recurred. Note what was done in response and whether it worked. Keep those reports, because they are exactly what the SRA will ask for if it wants to understand how the firm governs itself.
This is not additional bureaucracy; the compliant data already exists in the central record you are required to maintain. The step that most firms skip is reading it as a whole and acting proactively on what it says.
How RACO Can Help
Our Outsourced Complaint Management Service handles complaints from first notification through to resolution, and where necessary through to the Legal Ombudsman. As part of that service, we maintain the central record to the standard the SRA expects and provide trend reporting that gives the firm the management information described above, rather than leaving the data sitting in a file.
For firms that manage complaints in-house and want to strengthen their approach, our Detailed Risk Management and Compliance Review includes a review of complaint handling procedures, record-keeping, and reporting. Our Training courses cover complaint handling as part of the wider compliance framework.
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To ask any questions about the Regulation and Compliance Office and how we can support your Law Firm, please call us on 0203 985 8550, complete the online enquiry form, or email us info@regulationandcomplianceoffice.co.uk
