In Tiffin v Lester Aldridge LLP, the Employment Appeal Tribunal found that a fixed share partner (FSP) of the firm was not entitled to claim unfair dismissal because he was a ‘partner’ within the meaning of Section 1(1) of the Partnership Act 1890 and not an ‘employee’ within the meaning of Section 230(1) of the Employment Rights Act 1996.
The EAT ruled that there is ‘no statutory provision or any decided case which specifies that the share of profits of a person or his or her contribution must reach a certain level before he or she can be regarded as being a partner’.
Solicitor Mark Tiffin had argued that his limited voting rights and the fact that he was under the direction of the other partners meant that he did not carry on ‘business in common’ with the other members of the LLP. This argument was dismissed.
A further argument that the ET had erred in law in giving undue weight to the label FSP, rather than the true nature of the relationship between the parties, was also dismissed. The ET had considered all the relevant facts before reaching its decision, which was open to it on the facts of the case.
Decisions in cases such as this will depend on the individual facts. We can advise you on all matters relating to partnership agreements or contracts of employment.