Lawyers made redundant when the Solicitors Regulation Authority closed their Liverpool firms have blamed the regulator for their not being paid for August.

The Solicitors Regulation Authority intervened into BPS Solicitors and Langtons Law last month, forcing both firms to shut immediately and leaving dozens of staff – including trainees midway through training contracts – without jobs.

The effect of the intervention was to freeze the firms’ accounts, meaning that staff could not be paid for the month. Despite apparent efforts to broker a compromise through supervised access to the accounts to cover salaries, that was not possible.

Several staff have publicly expressed their dismay at the SRA for not seeking to help them as part of the intervention. One trainee solicitor told the Gazette they were still waiting to be paid, with many having mortgage or childcare commitments they are struggling to meet.

The trainee, whose identity the Gazette is protecting, said: ‘Many of us were left in the dark about what processes were in place to ensure we were paid and our former managers could only tell us that the SRA simply refused to release funds, it’s a shocking situation.’

It is understood that staff at BPS were told one day before payday they would not receive their salaries. Many had also recently transferred from another Liverpool firm subject to closure, McDermott Smith, so are unsure about their employment rights.

One BPS trainee wrote on LinkedIn: ‘At the moment former staff, such as myself, don’t have any idea if and/or when we will be paid nor if/how this will affect redundancy. Few staff were employed at BPS long enough to qualify for redundancy outright. We also have the joy of having two recently intervened firms on our CVs for life. The SRA, to date, have provided conflicting and confusing advice to both situations.’

Their former colleague wrote: ‘The people who have been put in this position through no fault of their own are the ones taking the brunt of everything. Can anyone who may have a little more experience with the SRA care to shed even the tiniest bit of light on this situation and explain to me why the SRA would not even allow supervised access to the bank accounts so that the innocent staff in this situation could be paid.’

It is understood that in general the SRA is reluctant to unfreeze accounts of intervened firms in case client money has been moved to the office account (although there is no suggestion that has happened here).

An SRA spokesperson said: ‘When we have to close down a firm, our role and focus is protecting clients and the wider public. We close down the law practice, and not the business that surrounds it. Owners of that business as employers remain responsible for their employees, including the payment of salaries. We understand that this will be an upsetting and uncertain time for those who were working at the firm, but this is an employment issue.’

The Liverpool Echo has reported that Langtons director Kathryn Langton – who was also suspended by the SRA – made unsuccessful representations for payment of the salaries to be made from the office account. 

Her representative, Anthony Nelson of Haworth & Gallagher Solicitors, said Langton was ‘utterly helpless’ and regretted the hardship that staff were suffering. Nelson told the Gazette: 'These are very complex matters and I am confident that once my client can mount a full explanation with corroborative evidence that she will be cleared of any dishonest practice.'

 

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