Workplace stress can have significant consequences for employee wellbeing, and negatively impact productivity and performance. For solicitors, this can lead to a heightened risk of technical or judgement errors, increasing the likelihood of a professional indemnity claim. To avoid such a scenario, firms need to take action to cultivate a positive workplace environment and combat the sources of stress.
Stress is common within the legal sector
By the very nature of their work, solicitors are under constant pressure to perform. Solicitors handle critical cases and transactions for their clients, and are required to prioritise a number of tasks during the course of every working day. The need to maximise fee earning time makes heavy workloads and tight deadlines a frequent occurrence.
While a certain amount of pressure can help to achieve targets, meet deadlines, and deliver results, problems can arise when that pressure becomes too intense. Research shows that high levels of stress are common among lawyers. Of the respondents to LawCare’s 2020-21 Life in the Law report (opens a new window), 69% of legal professionals stated that they had experienced mental ill health. The study also found that burnout ranks high among the challenges faced by the legal profession.
The consequences of workplace stress
High levels of stress have a significant impact on employees’ health and wellbeing. However, there are also consequences from a risk management perspective. At a basic level, a professional-client relationship rests firmly on that professional’s ability to deliver quality client services. For solicitors, this means approaching engagements with appropriate levels of effort, competence, and objectivity.
By contrast, a stressful environment in a law firm can lead to a diminished client service. Solicitors suffering from stress and anxiety are more likely to suffer from reduced productivity, or encounter issues with their performance. They may show a greater tendency for making errors, both technical and in judgement.
With regard to solicitors’ professional indemnity insurance (PII), technical errors are an inevitable cause of claims, but an anxious or stressed workforce is likely to increase the risk of such errors exponentially. In some cases, solicitors inheriting files from colleagues have failed to recognise and meet essential deadlines within the files. Similarly, there have been claims arising from simple errors such as failing to register a standard security, or to intimate notice of an assignation of rights, serving defective notices to quit, or missing key clauses from commercial contracts.
Creating an environment of wellbeing
Taking effective steps to manage workplace stress are paramount to ensuring a positive and healthy organisation. This, in turn, will help to reduce the likelihood of future PII claims.
Earlier this year, the Solicitors Regulation Authority (SRA) released new guidance (opens a new window) on wellbeing at work. The guidance highlights how bullying, harassment, discrimination, and victimisation can also serve as sources of workplace stress. It also sets out expectations for firms to look after the wellbeing of those who work within the firm, while supporting them so they can work safely and effectively.
This means taking steps including:
Having effective systems and controls to supervise work, and monitor concerns which may affect individuals’ wellbeing and competence.
Providing a safe environment for people to raise concerns and addressing them promptly and in a constructive manner. Firms should also be aware that that poor performance by an individual could be a warning sign that an individual is working under stress or duress.
Treating people with dignity and respect to create an ethical workplace and an engaged workforce that provides a better client experience.
Having in place and implementing policies on bullying, harassment, discrimination, and victimisation as well as disciplinary procedures for breach of those policies.
Risk management – making an assessment
By conducting a risk management assessment of their working environment, firms can identify potential sources of workplace stress, and tailor policies and support systems to minimise the likelihood of its occurrence.
Key questions as part of a risk management assessment include:
What are the risks of stress?
Would you be able to recognise signs of stress in yourself or in others? Do you know how to respond to stress?
Do you assess the workloads of staff, as opposed to simply measuring hours worked?
Does a pattern of absence within the firm reveal an underlying problem?
Do you record and analyse actual and potential complaints and claims to identify where there might be issues? Does the issue of “stress” feature in this analysis?
Is everyone within the firm able, willing, and actively encouraged to admit mistakes or say that they need help? Is there a fear or blame culture within the office?
As with all areas of effective risk management, the benefits are likely to be realised in more than one aspect of the practice. For instance, minimising the risks which could result in complaints, or a negligence claim against a practice are also likely to result in better job satisfaction and morale, and improve efficiency.
Typical employee benefit packages (opens a new window) can also provide mental health support and services through policies, often at no cost to the employees themselves. Firms should ensure these services are accessible and visible to employees to ensure help can be given to those in need.
For further information, please contact:
Steve Holland, Senior Vice President, Global Professional & Financial Risks