The Court of Appeal has ruled that LLP members are not “workers” able to claim for detriment for whistleblowing, overturning an EAT decision reported here.
The Court decided that s4(4) of the Limited Liability Partnerships Act should be interpreted as meaning that an individual cannot be an employee or worker of the LLP if they would have been a partner of a general partnership (not registered as an LLP). This is because a general partnership is not a separate legal entity (unlike an LLP) and it is legally impossible for one individual partner to be both worker/employee and (co-)employer. But even without this section, the Court considered that the status of a worker or employee necessarily involves a relationship of subordination to the employer, whereas the equity partnership concept is the antithesis of subordination.
Only those who are salaried ‘partners’, or (possibly) who have some separate employment with the LLP apart from their status as LLP member, may have employment/worker rights.
Subject to an appeal, this means that LLP members who are equity partners will not have a range of rights available to workers, including to claim for detriment for whistleblowing, working time rights such as paid holiday, and rights to be auto-enrolled in a pension scheme. Of course, despite this restriction on whistleblowing protection, LLPs should still have policies in place to encourage partners (and other staff) to report wrongdoing so it can be addressed.
LLP members can still bring discrimination claims under express provisions in the Equality Act, as in this case. The Court confirmed that the tribunal had jurisdiction to hear the claimant’s discrimination claims in England despite her working mainly in Tanzania. It ruled that where an employee lives and/or works at least partly in England, the test is whether there is a sufficiently strong connection with England; it is only if the work is wholly abroad that the tribunals must carry out a comparative exercise to determine which country has the strongest connection. (Clyde & Co v Bates van Winkelhof, CA)