I Am a Partner or Member – Am I Protected by Discrimination Law?
Date: 15/02/2024 | Corporate
Partners and LLP Members are self-employed, yet both Partners and LLP Members are protected by discrimination law as if they were employees.
Discrimination is often regarded as a purposeful act. In many cases, discrimination can inadvertently occur without malice. As a result, both partnerships and LLPs should review their arrangements periodically to ensure that they are complying with the relevant legislation.
Under the Equality Act 2010 (“the Act”), employees and Partners or Members are protected against discrimination on the grounds of:
- age;
- disability;
- gender reassignment;
- marriage and civil partnership;
- pregnancy and maternity;
- race;
- religion or belief;
- sex; or
- sexual orientation.
If a person is successful in a discrimination claim, compensation is uncapped. Any claim brought against the partnership or LLP can be costly both in legal fees and compensation.
What can you do in your Partnership Agreement or Members’ Agreement to help?
Frequently Asked Questions
Can I provide in my Partnership Agreement or Members’ Agreement that a Partner or member must resign when they reach a certain age?
Since 2011, there is no longer a default retirement age in the UK.
Compulsory retirement clauses are one of the most common examples of direct discrimination on the basis of age. However, compulsory retirement can be justified or fall within the scope of an “occupational requirement”. A person (or partnership/LLP) seeking to rely on the clause must be able to show that it is a “proportionate means of achieving a legitimate aim.”
Partnerships or LLPs wanting to provide for compulsory retirement in their agreements would be sensible to take legal advice before introducing or maintaining clauses which seek to enforce the retirement of a Partner or a Member.
Can I provide in my Partnership Agreement or Members’ Agreement that a Partner or Member on maternity leave does not accrue holiday leave entitlement during her maternity leave?
Maternity leave is protected under the Act. Where a Partner or Member is granted a right to maternity leave under their partnership or members’ agreement, their right to other benefits must not then be restricted on the basis of their maternity leave.
A Partner or Member on maternity leave must be entitled to all of the benefits that they would have been had they not been on maternity leave. It is advisable that Partners or Members are entitled to an accrual of full holiday entitlement whilst taking maternity leave.
Can I expel a Partner or member who has been off sick long term?
In the first instance, this will depend on the terms of your partnership agreement or members’ agreement. There is no right to expel a Partner from a partnership or LLP unless there is a specific power conferred by your Partnership Agreement or Members’ Agreement.
There are a number of requirements for expelling a Partner in a partnership, notwithstanding any potential protected characteristic they may have. We set out that out in our article here. If it could be considered that the Partner or Member concerned has a disability, their expulsion could give rise to a discrimination claim unless it can be justified that to expel them is a “proportionate means of achieving a legitimate aim”. In that situation, the other Partners or members must be able to demonstrate that they have considered all of the relevant ways in which to make reasonable adjustments for the return of a Partner or Member whose expulsion is in question.
You should take careful legal advice to ensure that your Partnership or Members’ agreement takes account of the applicability of discrimination legislation. An expulsion notice can be rendered invalid by a court or employment tribunal if the required steps are not carried out. Please note that this article only mentions three specific cases of potential discrimination and is not intended to be taken as comprehensive advice on this topic.
For more advice please contact Nathan Adam or another member of our Corporate team.
Disclaimer
The matter in this publication is based on our current understanding of the law. The information provides only an overview of the law in force at the date hereof and has been produced for general information purposes only. Professional advice should always be sought before taking any action in reliance of the information. Accordingly, Davidson Chalmers Stewart LLP does not take any responsibility for losses incurred by any person through acting or failing to act on the basis of anything contained in this publication.
