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LLP Member’s are ‘workers’ shock!

If you are an LLP Member the chances are you have more rights than you did when you signed up to that LLP Deed.

Hot on the heels of HMRC’s recent change in the tax treatment of LLP Members, the Supreme Court have set the worker cat amongst the self employed pigeons!

Generic partnership/business

The case of Clyde & Co LLP and another v Bates van Wincelhof [2014 UHSC 32] has held that members of LLP’s can be a ‘worker’ for the purposes of bringing a whistleblowing claim under s 43 Employment Rights Act 1996 (ERA). So LLP’s will need to be careful when exiting, demoting or reducing the profit shares of their Members going forward to ensure there are no grounds for a whistleblowing claim.

 

But the decision effectively brings with it a whole raft of further rights for LLP Members as workers, including the right to paid annual leave, rest breaks and a maximum working week (subject to opt out) under the Working Time Regulations (WTR); the right to a pension contribution under auto enrolment; the right not to be treated less favourably as a part time worker than a full time worker under the Part Time Workers (Prevention of Less Favourable Treatment) Regulations; and the right not to have an unlawful deduction of wages under s13 ERA.

Every case on its own facts of course, but is there a future for the Fixed Share Partner role in LLP’s? Let us know your thoughts!

 

 

 

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Legal news, views, trends and tools for HR Professionals. Stay ahead. Go further