Equality, diversity and inclusion is on the agenda of many regulators at the moment. In September last year, the SRA published new guidance setting out its expectations. If you are a law firm, you’ll want to pay close attention. This article explains what’s in the guidance and some of its practical implications. The New Year could be an opportune time for a refresh of your existing systems and controls, with this guidance in mind.

What’s prompted the new guidance?

The SRA Principles (which set out the SRA’s “fundamental tenets of ethical behaviour”) require regulated firms and individuals to act “in a way that encourages equality, diversity and inclusion” (EDI). 

The SRA first published guidance on what this means in practice back in 2019. Much has changed since then. Aside from shifting expectations and practice within the legal industry, there have been two key regulatory changes since the SRA’s original guidance:

1. In 2023, the SRA brought in an explicit rule requiring regulated individuals and firms to treat colleagues/those who work for them, and with them, fairly and with respect. This includes an obligation not to bully, harass or discriminate unfairly.
2. In 2024, the law was changed to require all employers (not just law firms) to take reasonable steps to prevent sexual harassment.

It was therefore high time for an update. In its news release, the SRA recognised recent progress but acknowledged there is “more that we and others can do to encourage EDI in the legal profession” pointing out that:

• a diverse and inclusive legal profession is vital in maintaining public confidence in our sector and the justice system; 
• a legal profession that both welcomes and reflects the diverse community it serves will encourage more people to seek legal help, improving access to justice; 
• a diverse and inclusive workforce can deliver benefits in terms of productivity and innovation. 

What does the new guidance say? 

The updated guidance can be seen as a codification in some respects, bringing together the SRA’s expectations when it comes to EDI and in many places linking to existing guidance. There are, however, some key additions, including:

• Additional guidance for managers on challenging the behaviour of other people. This builds on the SRA’s existing Workplace environment guidance (see our earlier article here). The new guidance includes an example explaining that a partner at a law firm must act when a solicitor complains about repeated suggestive comments made by security staff.  
• Some new useful case examples about treating colleagues, clients and others fairly and with respect, and when acting for clients who behave in a discriminatory way, together with example communications which may be considered offensive.
• A list of example proactive steps (proportionate to the size of the firm) to encourage a diverse workforce at all levels. These include keeping recruitment, progression, reward and recognition policies under review to make sure they are not creating unfair or unlawful barriers for underrepresented groups.
• New guidance on terminating a retainer with a client who behaves in an offensive or discriminatory way. The guidance makes clear that firms should have a process in place for warning clients that this sort of behaviour may entitle the firm to terminate the retainer and allowing clients a chance to challenge any proposed termination. 
• A new section on reporting obligations. In this section, the SRA has emphasised: “[w]e do not act on all complaints and reports. We focus on conduct or patterns of behaviour which amount to serious misconduct. This will generally include, but is not limited to sexual misconduct, unfair discrimination, abuse of position and taking unfair advantage.”
• A reminder that sexual misconduct, unfair discrimination and non-sexual harassment, are unsuitable for a financial penalty, except in exceptional circumstances. 
• A reminder that, while the SRA is primarily concerned about conduct which relates to an individual or firm’s legal practice, conduct does not need to take place in a workplace in order to relate to practice. Some matters, including discriminatory conduct, sexual misconduct or offensive communications on social media, are so serious that they are capable of damaging public confidence in the solicitors’ profession, even if they are not linked to legal practice. 
• Two new annexes which set out terms used in the guidance (Annex 1) and actions that law firms can take to support compliance (Annex 2). The SRA makes clear at the start of Annex 1 that when it is considering conduct in breach of its Principles, the SRA is not constrained by the legal definitions set out in the Equality Act, nor limited to considering conduct which is related solely to the protected characteristics in the Equality Act (more on this point below).

What this means for law firms in practice

In its news release, the SRA is keen to underline that it has not changed its approach and that the updated guidance provides, “further support for those we regulate to help them understand our expectations and what those expectations mean in practice.” While the new and expanded guidance will generally be welcomed by law firms, this statement potentially creates some uncertainty over whether the SRA would apply the new guidance retroactively, to situations that happened before its publication. 

While the updated guidance is far more detailed than its predecessor in many respects, it remains detail light in some areas. For instance, there’s no example of when it would be acceptable to terminate a client retainer without notice. Also, the additional guidance on challenging behaviours only gives one practical example. In practice, keeping a close eye on decisions made by the SRA and the Solicitors Disciplinary Tribunal will continue to be important for understanding the SRA’s expectations. 

You will want to comb through the guidance to check that you are implementing all the recommended actions. This is particularly so if you are a large firm: the SRA has made clear that where the term ‘should’ has been used in Annex 2, “the suggestions are not mandatory for every firm, although we would expect larger firms to be undertaking many of these actions to make sure they are meeting their obligations set out in the guidance.”

Take note, also, that the SRA’s expectations around EDI are broader than the Equality Act 2010. For example, the guidance states that the SRA would not only consider the nine protected characteristics under the Equality Act 2010, but misconduct related to e.g. someone’s socio-economic background or because they have a strong regional accent. This makes clear that SRA-regulated firms are under duties to uphold EDI that go further than the legal requirement applying to all employers. You’ll want to consider if your current diversity and inclusion training is suitable to address this.

What’s next?

The updated guidance and corresponding news release make clear that EDI will remain a hot topic for the SRA in 2026. Given the new guidance and the ongoing levels of EDI-related misconduct reports being made to the SRA (which have apparently not reduced despite the 2023 Code updates), law firms should look to start the New Year with an EDI review and refresh, to ensure the SRA’s updated expectations are being met 

You can download the updated guidance here and the news release here. The training team at Lewis Silkin work regularly in this area, devising training programmes for law firms which highlight issues around harassment and bullying within the regulatory framework. We regularly deliver training to partners, managers/directors, fee earners and business services. If you would like to have a conversation about how we can support you with training, please contact our head of training Lucy Hendley or your usual Lewis Silkin contact.