As well as looking at whether someone’s lost out financially as a result of a mistake, it’s important to recognise the emotional or practical impact it’s had. This “non-financial” impact could be:
- distress – including embarrassment, anxiety, disappointment, loss of expectation, upset and stress. There may be some overlap with pain and suffering (see below) – for example, if the distress made someone ill;
- inconvenience – including the time someone’s spent and/or effort they’ve had to go to as a result of a business’s mistake;
- pain and suffering –including physical or mental suffering arising from what a business has done; or
- damage to reputation – where someone’s personal reputation has been negatively affected as a direct result of a business’s actions.
The power to make this kind of award comes from the rules that apply to how we work. DISP 3.7.2 R of the regulator’s handbook says we can award fair compensation that’s a proportionate reflection of the impact a business’s actions (or inaction) had on their customer.
That’s why, in two separate cases where the business made the same mistake, we might award different amounts – because the mistake had a different impact on those individual customers.