Dealing with Complaints in the Right Way
Your firm receives a complaint, how do you react? Are you angry? Are you affronted? Do you think, “what did we get wrong and how do we put it right”? Do you think, “let’s investigate and find out what really happened”?
As we know, the FCA defines a complaint as an expression of dissatisfaction whether justified or not – that is the abbreviated version. They require firms to deal with complaints whether they are in writing or oral and however they are communicated. That could be in a letter, an email, by phone, in person or any other means. They also expect complaints to be investigated independently from the advisory process and by a qualified individual.
Your clients expect a first-class service from you and that is what you aim to provide. However, sometimes they may not be happy with your service or, whilst you hope not to have done, you may have got something wrong. It may be your fault, or it may be because of the nature of the product or service your client has received.
What you need to do is ensure that whatever the problem is, you resolve it in an appropriate way, because one discontented customer has greater impact than ten happy ones. Not only that, there is a regulatory impact when firms do not handle complaints correctly.
Not all clients will be happy. Even in the finest run business, problems, mistakes, or even bad luck can cause people to be dissatisfied. The professional and efficient handling of complaints is a critical factor for all organisations. There are real benefits in prioritising and improving complaints handling.
Research indicates that four out of five clients spread the word if a complaint had been handled badly, and clients who have had complaints handled well can become advocates of the firm, even if the complaint is not upheld.
Your firm must submit complaints data to the FCA twice per year. They also require firms to establish, implement and maintain effective and transparent complaints management policies and procedures for the prompt handling of clients’ or potential clients’ complaints.
The sixth of the FCA’s TCF outcomes is that consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint. This principle is carried through into the Consumer Duty, whereby firms must act to deliver good outcomes for retail customers.
Whether you think the complaint is justified or not, complaints must be investigated competently, diligently, and impartially. You must assess fairly, consistently, and promptly:
what the complaint is about;
whether it should be upheld; and, if so,
what action and/or redress should be taken
If you can you satisfy your complainant within three working days, you know may send a Summary Resolution Communication confirming how the complaint was satisfied.
Otherwise, within 56 days of receipt of the complaint you should send a final response letter that gives your client a clear assessment of the complaint and offer redress or remedial action if appropriate. If you are not upholding the complaint, you should explain why to the client to ensure that they fully understand your reasons.
Your final response letter must give your client the option to refer the complaint to the FOS if they are unhappy with the outcome.
The management consultant Donald Porter said, “customers do not expect us to be perfect, they do expect us to fix things when they go wrong.”
It is important that you do not ignore complaints from clients and that you have robust policies and procedures in place to address them when they do.
Compliance Matters UK Limited can help you investigate complaints fairly and impartially and review your complaint handling processes and procedures. Schedule a free, no-obligation consultancy call with us today.
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