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MANAGING RISKS

4 ethics rules your staff might be violating

It’s not just attorneys in your office who have to follow the rules of ethics. Your staff members have to follow them, too.

It doesn’t matter where the violation comes from, says law management consultant Jan Henderson of RJH Consulting in Jackson Hole, WY. What governs is the rule of respondeat superior, or “let the master answer.” The employer is held accountable for the business actions of its employees, and the fallout of violations can be malpractice claims as well as the loss of clients’ respect—and their business.

Go over the ethics code with staff when they are hired, says Henderson, who is herself a former firm administrator and paralegal. “If people are going to be held responsible for it, they need to know what it says.” And every six months or so go over it with the entire staff and discuss any problems that have come up.

Here she cites 4 areas where ethics violations often occur among legal staff.

1. Client confidentiality

The first area is client confidentiality, and that starts at the front desk where risks are not always so noticeable.

Anybody knows to position the computer monitor so it can’t be seen by people walking through, Henderson says. But what people tend to forget is that the reception desk should be in a secluded area where the receptionist can’t be overheard, because the mere mention of a client’s name can be deemed a privacy violation.

When overhearing can’t be avoided, the receptionist should not mention any client’s name. If Client Smith calls in and there are people within earshot, the receptionist should not call the attorney and say “Client Smith is on hold for you.” Make it anonymous: “A client is on hold for you.” If the attorney needs to know who the caller is, the receptionist should send an e-mail or walk to the attorney’s office and give the name in private.

People also tend to forget that confidentiality risks lie on staff’s desks where files are left unattended. It’s not uncommon to see “piles of files that anyone who is curious could rummage through.” And it’s not always espionage that’s the concern. More often it’s the snoop who wants to see the particulars of somebody’s bankruptcy or nasty divorce.

When a file is left unattended, it needs to be closed or turned face down.

The same is true for the copier and fax machine where client papers are left stranded.

And as at the reception desk, the computer monitors need to be positioned so that someone walking into an office or workstation can’t see them.

“Client confidentiality can’t be over-emphasized,” says Henderson. Each new hire needs to sign a pledge of confidentiality, and that pledge needs to be reviewed periodically with the entire staff.

2. Legal advice

The second area is the unauthorized practice of law. “When a paralegal or an experienced legal secretary is knowledgeable about a client matter, it’s easy to cross over the line and give legal advice,” Henderson says.

A client who knows the assistant well often feels free to ask something such as “do you think I should go ahead and sign this contract?” And if the attorney isn’t available and the answer is obvious, it’s tempting to give a yes or no.

Staff can answer questions about anything on the periphery of a matter—the time, the date, the name of the judge, the process of what’s going on. But that’s it.

Staff can’t answer questions about the substance of a case, and when a client asks a question of that type—perhaps what to say in a deposition or what action to take in some area—the answer has to be clear: “I can’t answer that for you. That would be the unauthorized practice of law. But I will ask the attorney to get back with you.”

And a pleasant follow-up to that is “do you have any other questions for the attorney?”

What if the attorney asks the staffer to pass the answers on to the client?

That’s permissible, Henderson says. The staffer can serve as the clearinghouse. But the information has to be attributed to its source: “Attorney A has asked me to tell you such-and-such.” And for safety, document the conversation.

Beyond that, she says, a staffer cannot make any commitment to a client on behalf of an attorney.

Suppose a client says “I have to have that contract by 5:00 p.m.” and a paralegal responds with “I’ll have Attorney A get it to you by that time.” If it’s not possible to get the job done, the attorney shoulders the blame.

A good mantra for staff is “the more we know, the more we should question ourselves.” And whenever there’s doubt about an answer’s being legal advice, don’t give it. Refer the question to the attorney.

3. Money management

The third common area of ethics violations is the management of client funds.

A small firm often does not have a finance director, and because, as Henderson notes, “lawyers go to school to practice law, not accounting,” the job of keeping the books is usually delegated to a staffer.

That staffer has to keep a complete and updated record of how the funds are handled, Henderson says. The money has to be kept in a separate account, and the client should be able to come in at any time and get a clear picture of what’s been deposited and what’s been taken out and when and what for. And if the account is earning interest, the ledger should show who’s earning that interest and where that money is going.

4. Access to firm’s data

The fourth area of non-attorney ethics concern falls not on the staff but on the firm. It has to have safeguards against the destructive action a disgruntled employee might take.

People with an axe to grind can wreak havoc on a firm’s operations, Henderson says. They can change computer passwords and block access to data. They can destroy files. A villainous staffer can even sabotage the court calendar or withhold client information from an attorney.

One protection is to make sure no one person ever has sole control of any aspect of the operations. That’s particularly true with the bookkeeping. There needs to be cross training so there’s always more than one person who knows how all the operating and trust accounts are set up.

Another is to make daily backups and keep them offsite so nobody can delete records permanently. But perhaps the most caution needs to be taken with terminations.

“Anybody who is terminated needs to leave right then,” she says. “Take their keys. Watch them as they walk out the door. Change every single lock if it’s necessary.”

Then change the passwords and lock them out of the computer files.


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