The Supreme Court has ruled that partners should be offered protection under whistleblowing laws in a landmark case which sets a precendent for partners in firms.
In the case Clyde & Co LLP and another v Bates van Winkelhof, the long-running dispute between international firm Clyde & Co and former partner Krista Bates van Winkelhof, the Supreme Court held that members of LLPs are ‘workers’ for the purpose of employment legislation.
The case hinged on whether partners are entitled to protecton under ‘whistleblowing’ laws. Under the Employment Rights Act 1996 (ERA), partners in firms are not entitled to protection from unfair dismissal.
English-qualified solicitor Bates van Winkelhof (pictured) alleged she was sacked by Clyde & Co in 2011 after making allegations against the managing partner of the firm’s Tanzanian operation.
In September 2012 the Court of Appeal ruled that members of LLPs are not ‘workers’ under employment legislation. But last year the Supreme Court granted Bates van Winkelhof permission to appeal.
The ruling means Bates van Winkelhof’s allegations of unfair dismissal due to whistleblowing will be heard in the Employment Tribunal in September, along with allegations of sex discrimination.
Supreme Court judge Lord Justice Nicholas Wilson, said: ‘The court allows the appeal of Ms Bates van Winkelhof and her complaint against Clyde & Co must proceed to full determination.’
The tribunal has not yet determined whether her complaint is valid, he said.
Mishcon de Reya partner Joanna Blackburn, who acted for Bates Van Winkelhof, said: ‘This case was about ensuring that lawyers, accountants, hedge fund managers and a host of other professionals are protected against dismissal if they blow the whistle about matters that they became aware of at work and which have wider ramifications for the public at large.
‘Partners are the people most likely to become aware of wrongdoing in LLPs but risked being at the greatest disadvantage with respect to protection.’
She added: ‘High-profile collapses like Enron and Arthur Anderson demonstrate why we need partners to speak out if they spot wrongdoing. It is in everyone’s long-term interests for partners to have the same whistleblowing protection that all other employees already enjoy.’
Clyde & Co said it strongly denied all claims made by Bates van Winkelhof and was ‘surprised’ at the Supreme Court’s judgment.
A spokesman for the firm added: ‘Their decision was confined to the narrow point of whether a partner can be considered a “worker” under the 1996 act. The knock-on consequences of this judgment are potentially significant and far-reaching and could affect partnerships both large and small.
‘We strongly deny Ms Bates van Winkelhof’s still-untested allegations. We contend the process of her removal from the partnership was set in place before her pregnancy was known, and before her disclosures.
‘Her refusal throughout to follow the dispute resolution mechanism available within the partnership agreement remains a disappointment.’
Andrew Stafford QC from litigation firm Kobre & Kim represented Clyde & Co. Thomas Linden QC from Matrix Chambers and David Craig from Essex Court Chambers represented Bates van Winkelhof and were instructed by international firm Mishcon de Reya.