Customer complaints & redress

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Does your business have effective policies and practices in place to deal with customer complaints?

EXCELLENT Answers

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GOOD Answers

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OKAY Answers

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POOR Answers

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Complaints and customer feedback are part of any business. While they are more common in some sectors, no business can guarantee never receiving a complaint. Handling grievances and complaints in a timely and effective manner can have a significant business impact, with speedy resolution and redress increasing customer loyalty and peace of mind. A problem resolved to a customer’s satisfaction can be excellent for a business’ reputation. Research shows that customers who feel that their complaints have been listened to, taken on board and handled well, become more loyal than if they had not had cause to complain in the first place. Since the cost of gaining a new customer is estimated to be at least five times higher than maintaining an existing, this can have a significant impact on the bottom line.

The dialogue within a complaints process can provide an opportunity for constructive ideas about improving products, adapting marketing practices, upgrading services, or modifying promotional material and product information. While complaints can be challenging, they should never be dismissed out of hand. ‘Picky’ customers may be articulating something that many more customers subconsciously pick up on that is harming their view of the company. Addressing this complaint could improve the business’ reputation and quality of service. Even if a complaint doesn’t lead to a change in service or product, it may affect other areas of the business, such as marketing strategy.

Culture can play a big role in how effectively complaints are handled. Ideally, staff should be receptive to complaints and use the information they get from them to improve products and services. In reality, this is not always easy, and companies should be aware of this. Staff need to be supported to deal with complaints, particularly when customers behave unreasonably. Some customers, even those with legitimate complaints, can act aggressively. Training on how best to handle complaints can address many of these difficulties when provided to both staff who are the first port of call and staff who are the nominated person to deal with complaints. This means that staff aren’t left unsure what to do and that customers can get access to an adequate response. Whilst dealing with customer complaints with respect is necessary, staff can face emotionally charged situations or even abuse in person or online, and businesses need to support staff through this.

In dealing with complaints, clear lines of responsibility and authority help solve consumer problems quickly and effectively. Any process requires objectivity and impartiality while confidentiality may be necessary as a safeguard to ensure fairness. Employees whose primary responsibility is sales or service, for example, may not be able to be objective if they feel their personal performance is being criticised. So an organisational culture, a philosophy of respect for the customer and a willingness to accept criticism, can be established from the very top to address this.

Consumers are generally most interested in concrete solutions to their problems by obtaining delivery, repair, replacement or refund for a product or service they have purchased, rather than in asserting their legal rights. A complaints process can be multi-stage, but the key thing is that customers are kept well-informed throughout the process, and receive feedback, regardless of whether or not their complaint is upheld. Effective in-house complaints mechanisms listen to complainants and take complaints seriously, regardless of whether or not they deem the complaint reasonable. Staff are trained to know what to do in cases of complaints, so that they can be handled in a courteous, fair and timely manner. Further they anticipate the reasons behind the complaint, and take into account the expectations and needs of the customer.

Staff can keep the complainant informed, which begins by acknowledging when a complaint has been received in writing. A good complaints procedure ensures that complainants are made aware of the expected timeline of actions and resolution, provided with options of what to do next, and are informed of the implications of these. Assurances should be made to customers that they won’t be charged for complaining, and the service they receive in the future won’t be adversely affected. For ease of access, it can be helpful if the standard complaints procedure is in the public domain and the process is straightforward and easily accessible. Finally, if delays do occur, customers are informed of what’s going on, and when they can expect to hear back.

Thorough investigations should be carried out to determine all the facts, before a judgement is reached. Once this is done, this should be explained clearly and fully to the customer, regardless of whether or not it is in their favour. If the company does find it has failed to provide adequate service or a satisfactory product to that customer, redress should be proportional to the harm caused to the customer. If customers don’t agree with the findings of the complaints procedure, typically they have the option of taking the case to the ombudsman.

A well managed complaints procedure can lead to insightful suggestions for improvement. Analysing complaints data means that complaints are not just an exercise in positive customer relations, but also can inform a business of areas that are ripe for improvement. Action can then be taken in these areas, to not only prevent future complaints, but to provide more effective and efficient service, and better products in the future. Complaints are an opportunity for a business, so long as they are handled carefully with respect for the staff and customers involved.

Alternative Dispute Resolution (ADR)

ADR, short for 'alternative dispute resolution', is a voluntary alternative to the law courts in civil disputes. The principal forms of ADR are arbitration, mediation, adjudication and conciliation. The aim is to settle disputes quickly, fairly and cheaply.

Dispute Resolution

'Dispute Resolution' may be formal or informal, private or public but all are mechanisms available to provide redress to consumers who have been affected by some economic harm.

External Mechanisms

'External mechanisms' may include ADR, small claims courts, private collective action lawsuits, legal action by consumer associations and government obtained redressal.

Goodwill returns policy

In the UK, most retailers choose to provide a 'goodwill' returns policy offering an exchange, refund or credit note for most returns. This goes beyond statutory rights to return a product if it is faulty or was sold damaged and the customer can demonstrate they didn’t know this. Typically retailers offer a refund if the product is returned in a saleable condition with a receipt within 28 days of purchase, but they are not legally obliged to do that. Whilst retailers are not obliged to have such a policy, if they do they are obliged to stick to it.

Ombudsman

'Ombudsmen' exist to deal with complaints from ordinary citizens and consumers about most public bodies and some services in the private sector. Their services are provided free of charge, and they are not regulators, rather they deal impartially with individual cases, once internal complaints procedures have been exhausted.

Small claims court

When someone or a business is 'taken to the small claims court' this means that a claim is made against them for an amount under £10,000 in the county court. For complainants, this can be a last chance attempt to get what they feel they’re owed, and they will have to demonstrate that they have tried other routes to resolve the issue.

Answering YES

All Businesses MUST

Describe their policies and practices on customer complaints and redress

Describe how they monitor and evaluate their complaints practices

All Businesses MAY

State any philosophies or values which influence their approach to customer complaints and redress

Give examples of how they’ve used complaints to improve their business

Describe the training they give to staff on how to handle complaints

Describe if and how they influence others to provide a high quality complaints service

Provide any other relevant information

Give details of any industry organisations the business is a member of, or any voluntary codes of conduct it’s signed up to

Answering NO

All Businesses MUST

Explain why they do not or cannot answer YES to this question and list any mitigating circumstances or other reasons that apply

All Businesses MAY

List any practices that are relevant, but not sufficient to answer YES

Mention any future plans

DON'T KNOW is not a permissible answer to this question

NOT APPLICABLE is not a permissible answer to this question

Version 1

To receive a score of 'Excellent'

Handling complaints well is integral to our business. We learn from complaints, and actively encourage our customers to provide feedback. Customers report being highly satisfied with the complaints procedure, regardless of whether or not their complaints are upheld.

Examples of policies and practices which may support an EXCELLENT statement:

  1. Thorough and effective complaints procedure is a core part of business strategy
  2. Clear procedures in place for handling complaints, including escalation processes, actions staff are able to take without clearance from supervisors, and levels of responsibility
  3. Methods to improve the complaints procedure are frequently reviewed and updated
  4. Staff regularly reminded about procedures and are trained to handle complaints professionally
  5. Procedure goes beyond minimum legal requirement
  6. Keeps customers informed of progress of complaint and asks for their feedback on the process
  7. Third-party dispute-resolution mechanisms in place
  8. Policies and procedures for the fair and speedy resolution of complaints outlined and communicated to customers
  9. Customers’ complaints are reviewed for the purpose of improving the products’ quality in long term
  10. The process of making a complaint, seeking refund or redress has been made as convenient as possible
  11. Redress is made as quickly as possible, with clear timelines in place
  12. The firm provides compensation for damage/loss to the customer above and beyond cost of item or service
  13. The firm has promoted or supported the creation of independent arbitration and dispute resolution bodies which can issue binding rulings
  14. When complaints cannot be resolved in-house, signposts effectively to the relevant ombudsman or external agency
  15. Annual reporting includes complaint handling
  16. Regular internal reports on complaint handling
  17. Complaint information is used to review and make changes to products/services
  18. Staff who handle complaints are comprehensively trained
  19. Staff who handle complaints are well supported formally and by networks of colleagues
  20. Staff behave professionally when dealing with complainants
  21. Staff are well informed of complaint handling procedures
  22. All staff are aware of the company’s complaints handling process
  23. Staff are willing to refer customers to the complaints process whenever they are asked
  24. Customer satisfaction in the complaints process is measured and is high
To receive a score of 'Good'

Business has an effective complaints procedure in place. Customer concerns are heard and customers are generally satisfied with their experience of making a complaint.

Examples of policies and practices which may support a GOOD statement:

  1. Keeps customers informed of progress of complaint
  2. Clear policies and procedures for the resolution of complaints outlined, including a timeline for expected actions and resolution
  3. Staff are trained to handle complaints professionally
  4. There are (impartial) employees who specialise in handling complaints
  5. Support is available for staff who handle complaints
  6. Feedback to customers is comprehensive, regardless of whether or not their complaints are upheld
  7. Procedures are in place for dealing with difficult complaints effectively
  8. Employees are offered emotional support if necessary
  9. Customer satisfaction in the complaints process is measured
  10. Internal reporting takes place on the complaints process
  11. Has an expanded goodwill returns policy - a customer can return a product if they change their mind, within 28 days with proof of purchase
  12. Complaints data is used to improve products and services
  13. All complaints are taken seriously
  14. The company’s complaints procedure is detailed online, and is accessible over the phone, or in a branch in person
  15. Customers are informed of what’s happening with their complaint at various different stages
To receive a score of 'Okay'

Business has adequate policies and practices in place to handle complaints. In most cases, customers are satisfied with them.

Examples of policies and practices which may support an OKAY statement:

  1. Policies and procedures for the resolution of complaints outlined
  2. Small size company that do not have an established policies but deal with grievance on a case to case basis
  3. Redress made in reasonable time
  4. Staff have access to training on how to handle complaints
  5. Capacity to give customers some feedback on what has happened with their complaints, but is not consistently implemented
  6. Complaints mechanism is accessible online
  7. Staff are generally able to signpost customers to the complaints mechanism
  8. Junior employees tend to handle the most difficult complaints due to time constraints on more senior staff
  9. Feedback to complainants is patchy
  10. Customers are not disadvantaged by making complaints
To receive a score of 'Poor'

Business does not have policies or practices in place to handle complaints

Examples of policies and practices which may support a POOR statement:

  1. Statement of future intent to improve
  2. No procedure for dealing with complaints apparent
  3. The business lobbies or seeks to undermine the emergence of strong regulation, arbitration or dispute resolution mechanisms
  4. The business aggressively disputes claims for refunds or redress
  5. Staff are actively encouraged to refuse to refer customers to the complaint’s procedure
  6. The emotional burden of complaints lands solely on junior staff
  7. Feedback on whether or not complaints have been upheld is not given to customers
  8. Business fails to analyse trends in complaints
  9. Business does not learn from complaints
  10. Customer satisfaction of the complaints procedure is very low