Partner expulsion case offers lessons to LLP firms and their partners
Partners and LLP members are (to a greater or lesser extent) part-owners of, and co-venturers in, the business, rather than merely serving the business. As a result, true partners (and their LLP equivalents) do not have some employment-related rights such as the right not to be unfairly dismissed. However, most partnership and LLP agreements deal with the removal of partners or LLP members and partners/LLP members may have important rights under those provisions.
Partners and LLP members do have some of the rights that employees have, such as the right not to be discriminated against on grounds of protected characteristic such as race, sex or age and rights associated with the protection of whistleblowers.
In some cases, people are held out to the external world as partners, but in reality they are salaried employees, with all associated employment rights. Hybrid arrangements such as fixed share or junior equity partners can further complicate the position. Often, the first question to be asked is whether the particular partner/LLP equivalent is in fact a disguised employee.
If you have any questions or require partnership advice, please call or email our partnership specialists.
Partner and Head of Department
They are able to address wider employment, criminal, defamation and commercial litigation issues, which makes them very effective as a firm able to deal with complex multi-issue disputes."
Legal 500 UK, 2020
Kingsley Napley LLP leverages its ‘very strong employment capability’ to advise individuals and partnerships on partner moves as well as employment status issues."
Legal 500 UK, 2016
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