ACL survey predicts redundancy wave across PI firms
The Jackson reforms are likely to trigger a wave of redundancies across “demoralised” personal injury firms when they come into force in April.
Some 62% of claimant personal injury firms say they expect to make staff redundant as a direct result of the reforms, according to a snapshot survey of 50 firms conducted by the Association of Costs Lawyers (ACL). Only one in 10 firms say for sure they will not.
Lord Justice Jackson’s reforms to civil litigation, which include abolishing recoverability of success fees in “no win, no fee” cases, will be introduced by Pt 2 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 and are due to begin next April.
The majority of claimant lawyers responding to the ACL survey say they expect to lose work and make less profit as a result of the reforms.
More than two-thirds of respondents think the reforms will make their firms less willing to take on riskier cases, while more than three-quarters predict they will have less work, and 84% believe they will make less profit.
Nine out of 10 lawyers say they expect competition to drive down success fees once they are no longer recoverable from the other side. The survey also revealed confusion over who would pay for after-the-event insurance—the client, the solicitor or a mixture of the two.
Iain Stark, chair of the ACL, says: “It is easy for the public and policymakers to be indifferent to the impact of the Jackson reforms on claimant lawyers, but the responses to our survey indicate a demoralised group of people who will not be able to hold open the door so that injured people can access justice.”
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