The Supreme Court has decided that the Court of Appeal was wrong to conclude that members of limited liability partnerships could not also be workers. This closes what would otherwise have been a loophole in our whistleblowing legislation.

The key reason for the divergence in judicial views was a difference of opinion about the correct interpretation of a relatively obscure provision of the Limited Liability Partnerships Act.  In effect, the majority of the Supreme Court, unlike the Court of Appeal, thought they were free to decide whether or not the claimant was a worker without worrying about what her status would have been under an old-style partnership.

The Supreme Court agreed with the Employment Appeal Tribunal that the key ingredients for a non-employee worker were present. Ms Bates van Winkelhof was a junior equity partner in a firm of solicitors, entitled to a fixed share of the profits. She was an integral part of the business and could not market her services to anyone else. It did not matter that she was not in a “subordinate” position to the LLP as this was not always essential to attain worker status, particularly for professional jobs where there was necessarily a high degree of autonomy.

This decision will be significant not only to LLP members, but to other individuals working for organisations in professional jobs under arrangements which do not confer employment status.

The claimant can now proceed with her whistleblowing claim against the partnership. The firm also ran a preliminary point on the territorial scope of her claims, given that they arose while she was working in Tanzania. However, that argument was dismissed by the Court of Appeal and was not appealed to the Supreme Court (see our previous posting here).