Defining exactly what a partner is has become increasingly difficult in recent years, particularly since LLP status gained acceptance among law firms.
Every firm has a slightly different definition. Equity, fixed share equity, salaried, junior equity - the list goes on and on.
But we can now, thanks to the Court of Appeal, be sure that if someone contributes money to a firm, no matter how small an amount, they are categorically not an employee.
In a crucial ruling (see story) today a three-strong panel said Lester Aldridge had not unfairly dismissed a fixed share member of its LLP because he was not an employee.
Dismissing - firmly but politely - the arguments of appellant Martin Tiffin, the Court of Appeal said it did not matter that Lester Aldridge’s fixed share partners contributed only a small amount of capital to the firm or held only a small proportion of voting rights. What was important was that they did have a stake in the business and had signed a members’ agreement, not an employment contract.
In other words, a partner is a partner is a partner.