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Lord Neuberger, Lady Hale, Lord Clarke, Lord Wilson and Lord
Members of Limited Liability Partnerships are ‘workers’ for the
purposes of the employment legislation.
B became a member of C LLP. She received a fixed annual share
of the profits and profit sharing units determined by the board. She disclosed
to C LLP’s money laundering officers that the managing partner of a Tanzanian
law firm (with whom C LPP had a joint venture) had paid bribes to secure work
and the outcome of cases. She claimed that these were protected disclosures
under the whistle-blowing legislation and that she was subjected to detriments
as a result, including suspension, allegations of misconduct and ultimately
expelling her from the partnership.
The question was whether she was a ‘worker’ for the purposes of
the whistle-blowing legislation. Section 4(4) of the Limited Liability
Partnerships Act 2000 provides that members of an LLP are not to be regarded
for any purposes as employed unless, ‘if [he] and other members were partners
in a partnership, [he] would be regarded as employed by the partnership.’
Previous case-law established that partners cannot be employees because they
are all in a contractual relationship with one another so a partner ‘would be
both workman and employer, which is a legal impossibility’. But previous
case-law has not dealt with the question of whether partners can be ‘workers’,
for which the definition is someone who works under a contract to perform
personally any work or services for another party to the contract, other than
for a client or customer of a profession or business undertaking.
The Supreme Court held that B had contracted with the limited
partnership to perform work personally and so was a ‘worker’. Section 4(4) of
the 2000 Act did not change that.
Comment: This has wider
consequences than just for the whistle-blowing legislation. ‘Workers’ have
various rights and employers of workers have various obligations. For example,
employers may have to consider ‘auto-enrolment’ into pension schemes for
members of an LLP.