Google Quality Management for Legal Practices: March 2014

Monday 24 March 2014

What are the rules of engagement at your legal practice?

If you are in the management team of your legal practice it would be usually your responsibility to establish an engagement policy. This policy sets out the matters in which your practice will accept instructions.

Why do you need an engagement policy?


Because this policy is a risk management tools that will help you eliminate potential sources of failure to achieve your objectives. For example you will only accept instructions in areas of law in which either you or other lawyers in the practice have the expertise and experience to provide a service that will match the practice's quality objectives.

The policy will also filter out services which you cannot provide effectively, efficiently or economically. For example you may decide not to provide Legal Aid funded services or services to clients in another state.

The negative effect of uncertainty on your objectives will be minimised by establishing the rules of engagement.

This is an example of an engagement policy.

Engagement Policy


The engagement policy of [name of firm] is to accept legal work in the following areas of practice:
  • wills & administration of deceased estate 
  • commercial law 
  • commercial litigation 
  • property settlements & purchases of business 
  • liquor licensing 
  • migration advice 
  • franchises 
  • patents, copyrights & trademarks 
  • personal injuries 
  • family law matters 
  • police charges, traffic offences, and criminal offences.

[Practice Name] does not accept Legal Aid and does not represent clients residing outside of Western Australia. An engagement document is prepared at the start of an engagement or whenever a change in the service has been agreed to.

Our engagement policy is in harmony with all relevant legal profession statutory requirements.

The policy follows our practice's business plan and risk management policy.

The engagement policy is reviewed for continuing suitability once a year as part of the quality management system review.

The policy is included in our induction program and is communicated to all staff and clients on our website.

Terms of Engagement


Such terms often referred to as retainer or service agreement define the narrower perimeter of the services you have agreed to provide to a client in a legal matter. Amongst other things they determine the scope of services you have agreed to provide to your clients.

The law societies of the states and territories offer compliant cost kits and agreements.  

In the next post I will cover the basic requirements of the LAW 9000 standard about the terms of engagement. 

Sunday 23 March 2014

Have you communicated the principles relating to undertakings to all professional staff in your legal practice?

From the perspective of good risk management all legal practices should maintain a register of professional undertakings.
Controlling undertakings is usually achieved by establishing the relevant policy and procedure.

These are questions to consider before drafting your undertakings policy and procedure:
  • Do you maintain a central register of undertakings?
  • Do you record all outstanding undertakings on the register? This will define the scope of your procedure.
  • Are all your undertakings signed by the principal/partner in your practice? Undertakings must be approved before being given.
  • Do you have defined responsibilities and authorities within your practice which include the names of personnel authorised to sign undertakings? This is a requirement under clause 5.5.1 of the LAW 9000 standard.
  • If you have a register how often and by whom is the register reviewed? You need a review process in place to ensure compliance.

Here is an example of an undertakings policy and procedure.


Maintaining an up to date and a good format risk register will help you:
  • evaluate your practice's risk exposure 
  • provide evidence to your insurers about your practice's risk exposure
  • track and monitor the status of all undertakings
  • prioritise the high risk undertakings 
  • with the matter supervision process.

Computerised client management system usually provide an undertakings register. For a paper based register consider including the following column headings:

  • file reference
  • name of client
  • name of fee earner
  • date of prior approval by principal/managing partner
  • value of financial liability (if financial undertaking)
  • date of undertaking
  • summary of undertaking
  • date for compliance
  • to whom the undertaking was given
  • review date
  • date of final review and discharge by principal/partner.

The implications of providing undertakings must be communicated to all professional staff. The policy and procedure should be included in the practice's induction training program.

In the next post I will discuss the engagement policy that a legal practice should develop and maintain under the LAW 9000 standard.

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Tuesday 18 March 2014

Are you the master or the slave of your legal practice document management system?

Have you ever spent more time than you thought you should have searching for the right information to complete a task? Have you ever looked for a document which was labelled incorrectly or filed in the wrong client's file?

Searching for information which should have been within an easy reach is frustrating, inefficient and a waste of time.

Mastering the information chaos of your paper based or computerised document management system is not rocket science. It is actually achievable through the design and implementation of document and record control procedures.

I already discussed the document control procedure in my previous post. Now I turn to the LAW 9000 requirement for a records control procedure.

Definitions


Records - in the context of a legal practice include client communications, feedback, purchasing, corrective action reports, staff training, audits, meeting minutes, trust account, insurance, computer system backups and other internal and external records.

Compliance requirements


Besides being a good business practice records control is a mandatory requirement under your legal profession legislation.

For example under the Western Australian Legal Profession Act 2008 trust records must be kept in permanent form which means printed or capable of being printed. Where a legal practice maintains a computerised accounting system it will be necessary to ensure that a backup copy of all records is kept in a separate location.

The Regulations prescribe time frames:

  • within 15 working days after the end of the month trust records are to be printed
  • backup copies of trust records are to be made not less frequently than once a month
  • trust account receipts must be recorded within 5 working days
  • trust account payments must be recorded within 5 working days
  • trust account receipts payments or transfers must be recorded in the trust ledger accounts within 5 working days
  • reconciliation of trust records must be prepared within 15 working days after the end of the month
  • written notification to the Legal Practice Board of the establishment or closure of a trust account must be within 14 days.

Your legal practice should also comply with the identification, storage and retention requirements for your trust account and other records.

Unless you have a records control procedure communicated to all, is reinforced and records are audited regularly it would be hard to imagine that you are the master of your practice's information chaos.


Hints on drafting a records control procedure


You may find it useful having the answers to the following questions handy before drafting a document control procedure:
  • Have you identified your quality records? These are the records you need to control. See examples in the enclosed procedure.
  • Do you have a method for collecting, indexing, accessing, filing, storing, maintaining, and disposing of your internal and external quality records?
  • Who ensures that records are maintained in your practice?
  • How do you ensure that records can be traced and located quickly?
  • If you are storing records externally do you have a written process about controlling and accessing those records?

For an example of a document control procedure see the embedded procedure below.



In the next post I will discuss further the requirements for records control under the LAW 9000 standard with emphasis on pre-engagement communication records.


Sunday 16 March 2014

Document control is fundamental to any efficient legal practice. How do you control the currency, accuracy and distribution of your corporate knowledge?

Document control is one of the most important elements of any quality management system. It is essential for the management of information in any legal practice, including practices that don't have the resources to develop and maintain a fully fledged QMS.

Have you or your lawyers or support staff ever tried to locate a document and only succeeded after a long search, used a document not authorised for use or that had been superseded by a newer version, followed the wrong process because a procedure was never drafted and your good intentions were not enough to do the job correctly?

Without a document control procedure it is arguable that your legal practice can provide its staff with reliable information.

To aid in the understanding of this subject I have defined several terms:

Information
In the legal practice context information includes internal documents such as policies, procedures, working instructions, office documents, forms and templates, precedents, standard contracts and agreements and external documents such as equipment manuals, reference texts, legislation and any other internal and external documentation used in the provision of client services.

Document control
It is governing document quality and involves methods for controlling the currency, accuracy and distribution of your corporate knowledge. It also involves the control of documents of external origin.

Records Control
It is identifying, storing, protecting, retrieving and disposing of records. Records in the context of a legal practice include client communications, feedback, purchasing, corrective action reports, staff training, audits, meeting minutes, trust account, insurance and other internal and external records.

To distinguish between documents and records for the purposes of the above definitions here is an example.

A client questionnaire is managed by a document control procedure. When the questionnaire is completed by your client it becomes a record and it is then managed by the records control procedure.

Hints on how to draft a document control procedure

Before drafting your document control procedure answer the following questions.
  • Where do you store your documents? For example in paper files or online.
  • What is the process of authorising the development and release of new policies, procedures, precedents, working instructions etc?
  • What is your process for review, update and release of existing policies, procedures, precedents, working instructions etc?
  • How do you ensure that all of your documentation is current?
  • How do you ensure that only the current version of a document is available and all previous version have been archived/obsoleted?
  • How do you ensure that all of your reference texts, legislation and other external documents are up to date?
  • How do you ensure that your documents are available to staff when they need them?
  • Do you have a process in place which ensures that any new documents and changes to existing documents are communicated to staff? How do you know that staff have received and read the communication about such documents?
One of the hardest elements of document control is maintaining an up to date list with all of your practice's documents. There are two things which you can do to help this process.

1) Have the following information inserted on each document:
  • Issue date
  • Author
  • Approver
  • Review date.
2) Create a master index of all your documents.

The number of documents in any legal practice, no matter how big, is significant. You may find it easier to group your documents in several master indexes. You may have one master index of precedents for each area of law, another one for HR, a third one for your accounts etc.

In the days of paper based master indexes each document had its own unique identifier. Today, electronic document management systems such as SharePoint use your documents names as unique identifier.

Here is a sample of a paper based probate documents master index. You will be pleased to know that if you are already using an electronic document management system you won't have to allocate resources for the maintenance of your master indexes, they will update automatically every time you include a new document or update an existing one.



Here is an example of a document control procedure for legal practices.



In the next post I will discuss the requirement of the LAW 9000 standard for records control.

Saturday 15 March 2014

Your law firm processes are only rumours about how you do things if you haven't documented them

Previously I gave definitions of terms such as policy, process, procedure and working instruction used to describe the elements of the quality management system.

It may be obvious but it should be emphasised that all of your policies and supporting documentation that will help you put your policies into effect must be documented.

The second principle is that you should "say what you do and do what you say". It is of no use having a pile of policies and procedures which don't reflect what you do in your firm. Your quality management system is not a wish list of what should or might be done, it is what you do now.

With the above two principles in mind I now turn to the quality manual as a requirement of your QMS.

The quality manual is a collection of all your policies, procedures, work instructions and requirements of the QMS and describes the interactions between the processes.

Requirements under the LAW 9000 standard

The quality manual should include:
  • the scope of your QMS - since all activities performed within your practice will affect the quality of service delivery no activities should be excluded from the scope
  • all your policies and procedures or reference to where they can be found
  • a description of the interaction between the processes of your QMS.


All of your policies and procedures form part of your QMS so they all should be included or referenced in your quality manual.

I have enclosed an example of a quality manual establishing procedure.



In the next post I will cover the requirement of the standard to control the documents of your QMS.

Thursday 13 March 2014

Compiling a list of quality goals is easy, just recall all the promises that you have made to yourself, your clients and staff

Previously I covered the requirement of the LAW 9000 standard for having a quality policy as part of your QMS.

Now you need to plan for your quality goals that should address your priorities, your business intentions and your contractual obligations. Your business plan would have most likely addressed such goals under the heading "Operational objectives" or a similar heading.

Irrespective of whether you have already defined your quality objectives you should, when implementing your quality management system, review the current objectives. A review will establish if they still apply and help you determine what the quality management system distinctive goals are for its performance, such as:

  • Addressing corrective actions within a defined period of time
  • Providing quality system induction training to lawyers and staff
  • Conducting file reviews according to scheduled timeframes.

Things to consider when drafting your quality objectives procedure
  • When do you develop your quality objectives? For example it could be at your annual strategic planning meeting.
  • What are the business areas that the quality goals aim to sustain and improve? These may include administration, management, personnel, purchasing and procurement, client management and others.
  • Are your objectives measurable? Are they suitable for measuring KPIs?
  • Do you have a process in place for reviewing and updating of your quality objectives? Quality objectives may change over time and you need to monitor those to continually improve your services.

Examples of quality objectives
  • To provide clients with a unique service experience
  • To build relationships so our clients are comfortable communicating issues
  • To provide prompt, practical and easy-to-understand advice
  • To help our clients achieve their goals and objectives without unnecessary costs and delays
  • To handle client correspondence promptly upon receipt
  • To aggressively and tenaciously protect our clients
  • Provide mentoring and training of junior legal professionals
  • Ensure all staff know of our firm's policies and procedures
  • To provide clear and prompt bills to clients
  • To increase productivity
  • To share firm expertise and experience throughout the organisation
  • Improving compliance with external requirements
  • Reduce the number of client complaints
  • Improve levels of staff satisfaction
  • Improve levels of client satisfaction.

This list is only a small sample of the vast array of quality objectives you can set for your firm.
Remember when planning your list of quality objectives that they should support your quality policy and mission statement. Support staff are often at the front line of client service so ensure that they are included in the planning of your quality objectives.

For an example of a client service standard see the web pages of Stewart McKelvey law firm.

Next I will cover the requirement of the standard for having a quality manual.

Monday 10 March 2014

Is superior quality service a way of life at your law firm?

I guess that like most lawyers you believe that you are doing a good job at delivering a good quality client service.

But unless you have stated and communicated your quality policy and quality objectives to staff and clients you may be only preaching what you should practice.

In the LAW 9000 standard words about quality service alone are meaningless. They have to be backed up by your commitment to action. 

The question you should ask yourself is: "What evidence do I have to show that I really deliver a superior quality service to my clients?"

The starting point is to state what you and your organisation stand for. The quality policy should reflect the overarching commitment  of your organisation to comply and improve your QMS and to set up and review your quality objectives. The quality policy is a great place to state your mission, vision and values.

Quality policy - practical hints

Your quality policy should include:

  • a commitment to comply with requirements
  • a commitment to improve the effectiveness of the QMS
  • a commitment to set up and review your quality objectives
  • the firm’s ‘mission, vision and values statement’
  • a commitment to meeting client requirements 
  • an image the practice wants to convey to your clients
  • staff characteristics and how the practice treats staff
  • quality or legal goals
  • a description of the work that the practice undertakes.


Your firm should also have a process:
  • To review periodically the quality policy to keep it current
  • About how the quality policy is communicated to staff and clients.

An example of a procedure about your quality policy


1. Purpose
To define our firm's quality policy.
2. Scope
This section covers the overall intentions and direction of our firm as they relate to quality and as expressed by management.
3. Example of a Quality Policy
State the firm vision, mission and values to guide and drive the organisation towards its goals.
The [name of firm] is committed, at all levels of the company, to total customer satisfaction. To meet this commitment, we provide products and services that fulfil customer expectations, and provide quality at levels greater than that available from any of our competitors at a competitive cost. Our quality management system is based on the International Standard LAW 9000, and we are fully committed to continually improve the effectiveness of our system with constant top management review and oversight. This level of attention is complemented by formal management reviews, internal audits, extensive training, and an aggressive corrective and preventive action program that includes cross-functional teams for root-cause analysis and problem resolution. To ensure the integrity of our system, quantitative quality objectives based on operational metrics are established, monitored, measured, and reviewed by lawyers held accountable for their results. In addition, all of our employees are thoroughly trained in quality management methods and are supplied with the resources required to ensure that such methods are effective. At [firm name], business objectives and quality objectives are synonymous.
Signed:
Dated:

4. Review of Quality Policy

This quality policy is appropriate for our firm and consistent with our overall business policies and shall be reviewed on an on-going basis to ensure its continuing suitability.


5. Communication of Quality Policy
The firm shall ensure this policy is communicated and understood by all levels within the organisation by providing training sessions and by conducting internal quality audits under this quality manual.


In the next post I will discuss the quality objectives and give an example of a procedure that will assist you to establish objectives which are measurable and consistent with your quality policy.

Friday 7 March 2014

Management commitment to quality - an essential component of any QMS

Previously I summarised the general and documentation requirements of a quality management system for law firms under the LAW 9000 standard.

In this and the following posts I will dissect each requirement and provide examples.

Management commitment - an essential requirement

I want to make sure that all law firm directors and partners understand the following. If you think that you can develop, implement and maintain a quality management system for your firm by delegating all responsibility to someone within your firm or to an external consultant without your full commitment than you may forget about it. It isn't going happen.

The standard recognises the importance of senior management providing commitment and guidance. This is expressed in the requirement for evidence of such commitment under clause 5 of the standard titled "Management Commitment".

Now we have established that you must be fully committed to the implementation and maintenance of your QMS I will set out what you need to complete to show sufficient evidence of commitment.

Definitions

Staff - includes both professional and administrative staff.

Practical guide to demonstrating management commitment 

The following are the minimum requirements you need to meet to show your commitment to the QMS:

  • You need to communicate to the firm the importance of meeting client needs and all statutory and regulatory requirements. Tip: Communicate the importance of meeting your client needs and statutory requirements by including them as a standard clause in your employment contract. Ensure that when training staff this requirement is regularly reinforced.
  • You need to draft and communicate your quality policy to staff and clients. Tip: This policy should reflect the management's commitment to quality. The quality policy must include a commitment to comply with the QMS and to continually improve it. The policy should also include your firm's mission, vision and values. The policy should be communicated to staff and clients. More details in later posts.
  • Establish your quality objectives and communicate them to your staff and clients. Tip: If you want to improve your service and increase the level of client satisfaction, reduce the number of complaints, train your staff so they can better serve the clients' needs and consequently increase the level of staff satisfaction than just include them in your quality objectives list. More details about the quality objectives will follow.
  • Ensure that you have a regular schedule for reviewing your QMS and the schedule is communicated to staff. Tip: Only implementing your QMS cannot demonstrate your commitment to quality. What you  need to show is that you are reviewing your QMS regularly and assessing the need for changes to the QMS and reviewing your quality policy and quality objectives. The review of the QMS can take place at a special QMS yearly review meeting or be included as an agenda item on any of your other regular business meetings.
  • You need to ensure that you can provide the resources needed for the implementation and maintenance of the QMS and its continual improvement. Tip: Part of the QMS review process in the previous paragraph must include also a review of the resources needed by the practice for the maintenance of the QMS. Before embarking on the quality journey ask yourself: Do I have the people, suppliers, information, infrastructure, technology, work environment and money required for implementing and maintaining the QMS? Am I prepared to fill in any resources related gaps?
  • You must encourage competent work practices and avoidance of negligence.
  • The management of the firm must ensure that the client's requirements are met to enhance customer satisfaction. Tip: You might meet the client's requirements only if you review the client's instructions in the context of the practice's capabilities. You need to determine the client's requirements and then prepare a working plan (project management plan) for the client's matter. This requirement can be satisfied by ensuring that a robust system for supervision of matter files is in place. I will post more details about this requirement later.
By now you would have seen that a management team committed to the development and continuing improvement of the QMS is an essential component of the system. You would have noticed that the QMS is not about drafting a bundle of policies and procedures and storing them in a safe place. It is about communicating your commitment and making it seen and felt by staff and clients.

I also hope that so far you would have considered none of the LAW 9000 requirements as outrageous. They are just good practice.

In the next post I will provide more information about the quality policy and quality objectives.

Monday 3 March 2014

What are the general and documentation requirements of a quality management system for law firms?

Last week I put forward my arguments for implementing a quality management system (QMS) in every law firm.

This week I will summarise the general and documentation requirements of such a system.

The term quality management system refers to the international LAW 9000 standard. It is a system because it is a collection of business processes and their interactions needed to implement quality management.

Next I have defined terms I will use often in my discussion of the QMS for law firms.



Definitions

Quality
“Quality is fitness for use“, the service should meet its specifications

Quality Policy
The quality policy is a general statement made by top management that it intends to achieve quality because of the firm's operation.

Process
Activities, actions or functions designed to bring about a desired result.

Procedure
The procedure documents the step-by-step detail for the process activities and actions that must be executed in the same manner in order to always obtain the same result under the same circumstances. They typically include what, when, where, and who should do the activity identified.

Work instruction
Whilst a procedure documents the step-by-step detail for the process, a work instruction defines further details of one or several process step(s) that the business has put in place. Work instructions are for work performed in one area or function and typically tell you “how” to do the activity.

Quality Manual
The quality manual outlines the policies, procedures, work instructions
and requirements of the QMS and describes the interaction between the processes.


General requirements of the quality management system


The firm should:
  1. determine the processes needed for the QMS and their application
  2. determine the sequence and interaction of those processes
  3. identify and ensure control over any outsourced or subcontracted processes that affect the quality of goods or services
  4. comply with all statutory requirements that apply to the provision of legal services and conduct of legal practitioners.

I hope that the previous paragraph will make more sense when read in the context of the documentation requirements that follow.

Documentation requirements of the QMS


Earlier I referred to the QMS as a collection of processes which are activities, actions or functions designed to bring about a desired result (see the definition earlier on the page). Processes for management of activities, processes for provision of resources and processes for product realisation and measurement are all part of the QMS.

We saw in the definitions above that procedures and work instructions reflect your processes in writing. They are the bulk of the documents required by the LAW 9000 standard.

Below I have summarised of all the documents which must be included in the QMS for law firms:
  • documented statements of a quality policy and quality objectives
  • a quality manual - please see definition provided earlier
  • documented procedures required by LAW 9000 standard
    • Control of documents
    • Control of records (of all types)
    • Internal audits
    • Control of nonconforming product
    • Corrective action
    • Preventive action
  • documents needed by the organization to ensure the effective planning, operation and control of its processes
  • records required by this standard
  • an engagement policy
  • a business plan
  • a risk management plan
  • records as required by statutory or regulatory provisions applicable to the organization.

In the coming weeks I will discuss the importance of each QMS document and provide an example.                                                                                                                             

Saturday 1 March 2014

"Appropriate management systems" for incorporated legal practices in Australia

Does your law firm need a quality management system?

The number of incorporated legal practices (ILPs) has been growing steadily since they were initially permitted in NSW in 1991. The Legal Profession Acts in various Australian States and Territories require that legal practitioner directors of incorporated legal practices must ensure that an "appropriate management system" is implemented and maintained. For example see s 2.7.10(3) of the Legal Profession Act 2004 (VIC), s 140(3) of the Legal Profession Act 2004 (NSW), s 105(3) of Legal Profession Act 2008 (WA), s 125(3) of the Legal Profession Act 2006 (NT), s 117(3) of Legal Profession Act 2007 (QLD) and s 107(3) Legal Profession Act 2006 (ACT).
Failure to comply can amount to professional misconduct. I do not intend to discuss the effectiveness of regulating incorporated legal practices. This is a matter for the regulators.

What is the solution?

I am more interested in writing about how a law firm can satisfy the current legislative requirements and implement an "appropriate management system".
The most suitable solution is provided by the LAW 9000 Legal Best Practice internationally recognised quality framework for law firms. LAW 9000 incorporates all the requirements of ISO 9001 international standard and was developed by SAI Global, College of Law, NSW Law Society and the NSW Legal Services Commissioner.

I am not a director of ILP. Why do I need to know about quality management systems?

Running a law firm is a business and every business must manage risk. Even if the law does not mandate that you should implement and maintain a quality management system you may wish to:
  • protect your reputation
  • prevent loss by reducing and eventually eliminating malpractice claims 
  • lower operational costs 
  • improve efficiency 
  • achieve competitive advantage
  • improve the quality of the working environment.


Implementing a quality management system in your law firm should be the principal method used for reducing risk and improving service quality.

What are the benefits of a quality management system?

All of the advantages of such a system may not be immediately obvious. The most commonly cited ones are that a quality management system:
  • identifies and encourages more efficient and time saving processes (essential for law firms offering fixed fee service)
  • improves consistency in service delivery
  • provides transparency which ensures improved risk management
  • improves customer communication and reduces the number of customer complaints
  • highlights deficiencies
  • provides additional marketing opportunities
  • helps to attract and retain high calibre talent
  • helps to document all policies, procedures and working instructions.


Next week

I will discuss the general and documentation requirements of a quality management system for your law firm.