A year in the law

This round-up from just published Best in Law looks back at the last 12 months in the legal profession, including the immediate impact of Brexit, the last year’s mergers and the big issues that will still be facing lawyers in 2017.

The legal landscape has changed dramatically over the last year. From Britain’s vote to leave the European Union – which has thrown so much of the legislation that lawyers rely on up in the air - to ongoing attempts to open up access to the law, much that previously seemed certain is now in a state of flux. Even traditional hot-button issues such as the entrenched gender inequality at the top of the profession and swingeing cuts to legal aid could soon be coming to the boil, as a new generation clamours to have its say.

Meanwhile, the fluctuating fortunes of global financial systems continue to influence almost every aspect of commercial life. Recent years had seen a slow but steady recovery from the worst effects of the 2008 financial crisis, with mortgage lending rates climbing back to pre-recession levels and a rise in interest rates also looking likely. However, the fallout from the Brexit vote – a plunge in the value of the pound, a decision by the Bank of England to cut rock-bottom interest rates even further and ongoing uncertainty about the nature of the country’s future relationship with Europe and the new trade deals which need to be struck – has cast a pall over proceedings, while risky practices in the banking sector mean that another collapse is well within the bounds of possibilities. For more on the big business stories of 2015-16, see “The commercial year”; but let’s first look at the issues that have specifically been exercising the legal profession in the last 12 months.

The fight for equality

Unfortunately, gender inequality remains rife in the highest echelons of the law. Although over 50% of new entrants to the profession since 1993 have been women, the Law Society’s most recent annual statistics report for 2014 shows that while women currently represent around 57% of all trainee solicitors and associates, only 24% of partners are female (dropping to 19% in the magic circle). The most senior ranks of law firms, barristers’ chambers and the judiciary are still overwhelmingly dominated by white, privileged men. Although this is widely acknowledged as a problem, calls for change have been met with intransigence at the top. Lord Justice Sumption – who as one of 12 Supreme Court judges (only one of whom is a woman) is one of the most senior lawyers in the country – said this year that women should be patient and that it will take another 50 years to achieve gender equality in the judiciary.

Although the legal regulators have extensive rules and guidance on promoting equality, as well as professional and ethical behaviour, it would appear that these are not being taken seriously. A wide-ranging survey of women barristers found that discrimination and harassment are still rampant in the profession, prompting the Bar Standards Board to write to every chambers in the country to remind them of the rules on equality. Whether this will have any real impact remains to be seen.

The achingly slow pace of progress has led some lawyers to call for the introduction of quotas for senior positions. The issue is deeply controversial, with many finding the very idea that this might be needed to achieve equality offensive. However, this argument presupposes that women are competing on a fair and meritocratic playing field, when the overwhelming evidence is that the system is structurally stacked against them.

Whatever your view on quotas, women lawyers are doing a lot to further the cause. Lawyers – both female and male – can now join the Feminist Lawyers Society, which was established relatively recently as a platform to organise events, scholarship and campaigns; while the First 100 Years project celebrates the pioneering women who have achieved success in this male-dominated profession.

Education and training shake-ups

The Solicitors Regulation Authority (SRA) is continuing its attempts to widen access to the profession by diversifying its training pathways. Last year saw the introduction of ‘equivalent means’, through which paralegals can qualify as solicitors without doing a training contract, provided that they can demonstrate that the skills and experience they have gained are equivalent to those of a trainee at the point of qualification. The SRA has also been consulting on a new Solicitors’ Qualifying Exam (SQE) which all aspiring lawyers will have to pass in order to qualify, whether they go through the traditional training contract, the equivalent means route or a legal apprenticeship. This could potentially eliminate the need to study the Legal Practice Course (LPC) and make training as a lawyer more flexible.

The move has proved controversial, with criticisms ranging from question marks over the value of testing rote learning so soon before qualification to fears that it will create even greater segmentation among law schools and students, as well as arguments that the exam-based criteria it focuses on are pretty similar to those of the current LPC. It is also worth pointing out that the SRA’s concerns over the cost and quality of the LPC are a direct result of its previous decision to cede any regulatory responsibility for the course. In any event, leading universities have decided to stick with the LPC for the foreseeable, while the SQE looks set to be introduced in some form in the next few years – with the SRA’s final decision due in Spring 2017.

Fees and guarantees

As universities signal their intent to increase tuition fees for undergraduate degrees beyond the previous high of £9,000, and law schools likewise hike the cost of their expensive vocational courses year on year, finances have inevitably become a more important factor than ever for would-be and current students.

Sensing the prevailing mood, the University of Law has launched a ‘100% employability promise’ for its LPC students, who will be eligible to claim back 50% of their fees in cash if they are without a job in the legal or commercial sector nine months after graduating, plus an additional discount –equal to half the cost of the LPC – on a further postgraduate course. However, as always, the devil is in the detail: the offer excludes graduates who are working as paralegals, but have not yet secured a training contract; while the utility of an invitation to enrol on a further (albeit discounted) postgraduate course is questionable, given that most recruiters are at pains to stress that a master’s does little to boost one’s chances of securing a training contract or make up for poor grades. However, in some good news for aspiring solicitors, the Law Society’s latest statistics show that training contract numbers are up 9% on last year, although they still have not returned to their all-time high before the 2008 financial crisis.

Brexit

The referendum on EU membership has caused chaos from both a legislative and commercial perspective. Now that the electorate has voted for Brexit, the profession is left facing considerable uncertainty on everything from immigration – with new Prime Minister Theresa May refusing to guarantee the right to stay to EU nationals whose contributions are vital to our economy and public services – to the environment, employment and the commercial transactions which are the lifeblood of the City. Lawyers will have plenty to do as the dust settles and the country negotiates a new relationship with the trading bloc.

Legal challenges have also ensued: Mishcon de Reya is bringing the first of these on behalf of a group of anonymous clients, demanding that the government not invoke Article 50 – which will officially start the two-year process of leaving the European Union – without the proper parliamentary procedure being followed.

The outcome of the referendum also brought about change at the very top of the legal profession, as Justice Secretary Michael Gove – a leading Leave campaigner – botched a power play following David Cameron’s resignation which ultimately led to him being sacked from the Cabinet by the victor, his old rival May. The new justice secretary and lord chancellor is Liz Truss, the first woman to hold the position in its thousand-year history; she will doubtless be a key figure in next year’s edition of this piece.

The legal aid crisis

The outlook for people’s ability to access basic justice in this country in the 21st century is increasingly bleak. There has been a little good news for lawyers and prison workers, as (now former, after his post-Brexit power play went wrong) Justice Secretary Michael Gove embarked on a series of U-turns on policies introduced by his predecessor Chris Grayling, whose competence was continually questioned while he was in the role. Perhaps the most important volte face were the abandonment of an unworkable dual bidding process for firms applying for legal aid contracts, the suspension of a further 8.75% fee cut for duty criminal solicitors (lawyers who represent suspected criminals in police stations and magistrates courts), and the abolition of a draconian ban on prison inmates being sent books by their families. Perhaps Grayling had seen too many movies where prisoners escape using smuggled nail files and toothpicks – we’ll never know. Gove suffered an embarrassing defeat himself when the Ministry of Justice’s attempt to introduce a discriminatory residence test for legal aid claimants was unanimously thrown out by the Supreme Court.

However, the overall picture for the justice system has been one of funding cuts and exorbitant fee rises, despite the fact that UK law guarantees that justice be accessible to all. The House of Commons Justice Committee, a cross-party group of MPs, has called on the government to reduce employment tribunal fees in the wake of overwhelming evidence that the fees – introduced on the back of flimsy research and evidence – have blocked many meritorious and genuine claims from progressing.

The government has also proposed a 500% increase to Asylum and Immigration Tribunal fees – a move which appears to be aimed at enabling the Home Office to make decisions without scrutiny (currently a high number of its decisions are overturned on appeal) and stopping refugees and migrants from exercising their rights, which the Law Society has said could constitute unlawful discrimination.

Meanwhile, dramatic fee increases for employment and family cases have led to a rise in litigants in person – people forced to represent themselves because they cannot afford a trained lawyer. A report by Citizens Advice revealed that nine out of 10 people who have had to represent themselves as litigants in person in the family courts have suffered strain on their mental and physical health, while there has been a 30% rise in cases in which neither side has access to a lawyer, with 22% of those involving children. Many such cases centre on domestic violence issues, where forcing a woman to face her abuser in court is clearly detrimental both to justice and to the victim’s mental and physical health.

Another result of the fee increases has been a rise in the use of ‘McKenzie friends’ – people who are not qualified lawyers, but who assist litigants in person in court appearances. Often a McKenzie friend can be a friend or family member, but in other cases they are fee-charging ‘armchair experts’. The SRA has dubiously argued that McKenzie friends can help to fill the gap left by cuts to legal aid, but the Judicial Executive Board has proposed a ban on McKenzie friends charging fees for their services – a move which has been welcomed by the Law Society and the Chartered Institute of Legal Executives.

Against the backdrop of this punitive fee regime, journalists at the Law Society Gazette found that the government has wasted some £400,000 on failed attempts to push through a new criminal legal aid contract bidding scheme (which would have forced many crime firms to close if it were implemented). However, the full cost of services enlisted by the government – such as those provided by the Legal Aid Agency – has been withheld due to restrictions in the Freedom of Information Act, so the true cost of this episode may be much, much more.

The rise and rise of apprenticeships

Although the magic circle is divided on apprenticeships – Slaughter and May and Clifford Chance reportedly have no plans to introduce schemes of their own, but Freshfields looks like it may soon start taking on apprentices – they have now become part and parcel of the wider legal landscape. Firms including DWF, Fletchers and Ashfords have launched new apprenticeship programmes in the last year, while Clyde & Co, Bond Dickinson and Horwich Farrelly are among those to have expanded existing schemes.

Apprenticeships have also been welcomed outside the legal profession, from local government to commercial companies. Another great example is the BBC, which has committed to run its legal apprenticeship programme into a third year.

Firm dates

Mergers have become a common consolidation tactic in response to increasing pressure to keep fees down, while thriving firms are as keen as always to expand their practices. Key deals in the last year included the tie-up between Withy King and London firm Royds; the £250 million union of Irwin Mitchell and Thomas Eggar; Addleshaw Goddard’s entry to the US market by merging with Hunton & Williams; and Clyde & Co’s launch in Miami by splicing with local litigation outfit Thornton Davis Fein.

Give me law

Some key legislation is being debated in Parliament at time of writing, while other areas remain blighted by uncertainty. All eyes will be on how May approaches UK human rights in the wake of Brexit, given that as home secretary she previously called for the scrapping of the Human Rights Act and the United Kingdom’s withdrawal from the European Convention on Human Rights.

May has also been the driving force behind the Investigatory Powers Bill (widely known as the ‘snoopers’ charter’), which proposes to allow intelligence agencies to hack the phones, computers and other devices of citizens without needing the permission of a judge, and to force all internet service providers to store customers’ ‘internet connection records’ – a vague term which the government has so far neglected to define or clarify further. Necessary security measure or Orwellian assault on privacy? Whatever your view, the progress of this bill will be one of the most important legal developments to look out for over the next year.

Turning to legislation which successfully came into force this year, it is now mandatory for businesses employing over 250 people to calculate and publicise any gender pay gaps at their organisations. The government also launched a new flat-rate pension and raised the national minimum wage, rebranding it the Living Wage in the process (although it has still not reached the level of what is actually meant by a ‘living wage’). The increase prompted a range of responses from many employers, which scrambled to remove other employments benefits to offset the cost so that they don’t end up paying any more than before.

Case in point

As ever, important judgments grabbed the headlines this year. The Court of Appeal set a legal precedent when it sided with the Home Office in the first legal challenge against the government’s ‘deport first, appeal later’ policy, which removes the right of foreign nationals convicted of criminal offences to appeal their deportations from inside the United Kingdom. Under the new rule, foreign nationals can now be deported and instructed to commence the appeal from their country of origin.

An important precedent was also established by this year’s ‘celebrity threesome’ case, in which the Supreme Court upheld an injunction banning the UK media from reporting on the sexual escapades of an olive-oil loving celebrity, even though the name of that celebrity and the scurrilous details of the story were all over the Internet and foreign media outlets. The journalists arguing for the right to report claimed that the landscape in which they operate has been transformed by the Internet, but the Supreme Court judges asserted the continuity of traditional legal values regarding privacy. The case has bolstered courts’ powers to grant injunctions and strengthened protections for celebrities trying to keep their personal lives out of the spotlight – especially those with children.

In other news, Chagos islanders – who were forcibly evicted from their homes in the Indian Ocean in 1971 to make way for a US military base – lost their challenge to overturn a resettlement ban in the Supreme Court, meaning that their fight to return home continues.

What to look out for in 2017

Aspiring lawyers should keep a close eye on further changes to training announced by the SRA and BSB, although it will likely be years before any major change is implemented. Beyond that, businesses, firms and law makers will have their eyes trained on the timetable for Brexit and the commencement of negotiations; as a trusted legal adviser in training, you should certainly be doing the same. Meanwhile, the legal aid crisis looks set to continue by a government which appears to have left vulnerable people and the lawyers who represent them off its radar.

It will also be interesting to watch how the solicitor apprenticeship pathway develops over the next year, as the first cohorts continue on the long road to eventual qualification. And as a generational shift in attitudes within the legal profession becomes increasingly pronounced, calls for change and greater equality may only grow louder.

No one can predict exactly how these issues will play out in the year ahead, or which new ones will arise, but those with serious ambitions of becoming lawyers themselves should stay on top of the latest developments.

Josh Richman is the senior editor of LawCareers.Net.