The Court of Appeal has concluded that a fixed share LLP member was not able to claim that she was a whistleblower. Contrary to a decision of the Employment Appeal Tribunal earlier this year, Elias LJ has ruled in (1) Clyde & Co LLP, (2) John Morris -v- Krista Bates Van Winkelhof (A2/2012/1161/EATRF) that a member of an LLP cannot "have her cake and eat it". Whilst the claimant in this case, a Tanzania based former equity partner in a law firm, will be able to proceed with her claims for discrimination - an area in which partners and LLP members have specific statutory rights - she cannot bring a claim that she was treated detrimentally and/or dismissed because she had made a protected disclosure since she is neither a "worker" nor an employee for these purposes.
Elias LJ commented that the same reasoning would apply to partners in general partnerships, not just LLP members. Membership of an LLP or partnership in a firm is fundamentally incompatible with employee or worker status with the same LLP/partnership, because of the impact of s4(4) of the Limited Liability Partnership Act 2000.
As a separate point, the Court of Appeal concluded that even though Ms Bates Van Winkelhof lived and worked in Tanzania, there was a sufficiently strong connection with Great Britain that it was appropriate for her discrimination claims to be heard here.
The case will now return to the Employment Tribunal to decide, on the facts, whether she was discriminated against on grounds of her pregnancy and sex.
This decision, which is a return to received wisdom (on both questions of status and jurisdiction), will be welcome news to partnerships and LLPs, and is a reminder that those who opt for the benefits of partnership cannot also try to assert the rights of employees.
In an earlier e-alert, we mentioned that LLP members may be within the scope of the new auto-enrolment rules for pensions; this now seems less likely given the Court of Appeal's analysis.