What is a Complaint Handling Procedure?

A complaint refers to a person expressing dissatisfaction about a company’s actions or inaction. These can range from minor to severe and come in various shapes and sizes. Complaints should never be taken personally but should rather be dealt with professionally. 

Often a customer has a valid reason to complain, but sometimes their reasons may seem slightly well…..insane. Either way, your company should be equipped to deal with complaints effectively and with ease.    

Sometimes things go wrong and that’s OK; how we deal with the problem is the key to successful complaint handling. A complaint handling procedure (CHP) is a set of processes a company uses to handle, process and resolve complaints. 

This blog post will set out what a good complaint handling procedure looks like. 

A Four Stage Approach

Every “CHP” should have stages that a complaint must pass through. This creates a set of standards that complaint handlers and customers alike can easily follow. 

The Experience Corporation has created a simple four stage approach to handling complaints which can be applied to any industry. This includes financial services, retail, real estate and medical care to name a few. 

Stage 1: Information 


The first stage involves gathering information in relation to the problem. All you’re doing at this point is finding out what exactly has happened and why the customer is unhappy. The best way to get all of the details you’ll need is to call the customer and talk through what has happened. However, if the complaint issue seems fairly straight forward, you can gather information via email. 

It’s vitally important to take detailed notes at this stage with the goal of answering these two questions: 

  1. Why is the customer unhappy? 
  2. What does the customer want as a resolution to put things right? 

Here are a few basic tools your company should have in place at this stage: 

  • Complaint handling form – This is a document which a customer can complete detailing all of the information about their complaint. You can use a simple word document or an electronic form. 
  • Complaint records – A place where all previous complaints are stored using a cloud data storage system. 
  • Documentation – The CHP should be documented and made available for all staff members to access. 

Stage 2: Investigation 

Stage 2 is all about getting to the bottom of what has happened. The main focus here is gathering and analysing evidence quickly so you can start to form an opinion about the complaint. You should consider any relevant consumer rights, laws and regulations.

For example, if a customer is complaining about not being able to refund an item, it’s important to be aware of consumer rights about refunds relevant to your industry and country.  

Here are some guiding principles for the investigation stage: 

  • Clarify: What information do you need to obtain to be able to draw a conclusion about what has happened? 
  • Proactivity: Find out relevant information and use any resources you have available. This could include bank statements, photos of faulty goods, a google search or a phone call to the complaining customer.
  • Notes: Take detailed notes about your investigation and record this in one document. 
  • Timeline: Form a timeline of what has happened based on the evidence you have.

At the end of the investigation stage, you must decide who is at fault – is it your organisation, the customer, circumstances or a blend of all three? Once you have drawn this conclusion it’s time to start thinking about what you can do to put things right. 

Stage 3: Resolution 

If your company is at fault, your resolution should put the customer back in the position they were in before the incident happened. You should also consider if the customer deserves compensation for any distress and inconvenience caused. 

There can only be one of two outcomes to a complaint: 

  1. The customer wins the complaint (upheld)
  2. The customer loses the complaint (not upheld)

Possible resolutions for the complaint are the following: 

  • Non-monetary: An apology, a gift such as flowers, replacing lost items, free products or free services.  
  • Monetary: Financial compensation or a refund. 

Here is a step-by-step process that will help you through this stage: 

  1. Decide on the final outcome of the complaint – has the customer won or lost?
  2. Make a final decision on who is at fault – the customer, your company or circumstances. 
  3. Make notes about your findings and any evidence you’ve relied on to reach your conclusion. 
  4. Call the customer or send a letter setting out your findings. 

It’s important to establish if they accept or reject the outcome of the complaint at this stage. This will enable you to close or escalate the complaint in the next stage. 

Stage 4: Close / Escalation 

Stage four is all about bringing the complaint to a close. 

If the consumer has accepted the resolution of their case, then explain the complaint will now be closed. If you’re unable to reach the customer or they haven’t responded to your email, the complaint should also be closed and marked as resolved. Give customers 7 working days to respond to any emails and then move the complaint to the closed stage. 

If a customer doesn’t respond to your outcome, t’s safe to assume they have accepted the resolution or no longer want to pursue the case. In this instance the case can be closed. 

The Escalation Process 


If a customer is unhappy with the resolution of a complaint, they should be given the right to escalate it further. This just means they are given the opportunity for their complaint to be looked at again. This will either be by a manager or a different organisation such as an Ombudsman.

Some industries have a specific Ombudsman where a customer can go to such as the U.K’s  Property Ombudsman. However, some industries such as hospitality do not have an Ombudsman. 

For industries with an Ombudsman or trade body, customers should be told in writing they can refer their case to the relevant body. They should also be made aware of any time constraints related to their referral. For industries with no external body to look at complaints, customers should be given the right to refer their complaint to an internal manager. 

If a manager looks into the case they should issue a second opinion on the matter once they’ve carried out their own investigations. 

Closing The Complaint 

It’s now time to close the complaint. If the customer accepts the outcome from a frontline employee or manager or they do not respond within 7 working days, the case should be closed. If the complaint is referred to an Ombudsman or trade body, it should be marked as “referred.” Once you hear back from the relevant body, you can close the complaint on your end. 

Once a complaint is closed it shouldn’t be reopened as the customer has passed through all of the relevant stages. 

Complaint handling can be quite complex. By implementing a standardised procedure, you will be equipping your company or team to manage cases with a minimal amount of stress. 

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