Legal News

Partners are not Employees

The British Columbia Court of Appeal recentlyconfirmed that a partnership is not a separate legal entity from its partners. Consequently,partners cannot be considered employees of the partnership to which they belong.

In McCormick v. Fasken Martineau Dumoulin a partner brought a complaint againsthis law firm, challenging the mandatory retirement clause in the partnership agreement.He alleged that forcing him to retire at age 65 was discrimination inemployment on the basis of age, contrary to s. 13 of the Human Rights Code. The firm applied to dismiss the complaint on thebasis that partners are not employees and, therefore, are not covered by s. 13.

The BC Human Rights Tribunal considered thepartnership agreement and the firm’s operations and found that the partner’srole in the firm fell within the definition of employment under the Code. That decision was upheld by theSupreme Court of British Columbia on judicial review.

On appeal, the BC Court of Appeal heldthat for the Tribunal to have jurisdiction over a discrimination in employmentcomplaint, there has to be a relationship between two entities: an employer andan employee. The Court determined that “a partnership is not a separate entityfrom its partners, and a partner cannot be an employee of, or employed by, apartnership of which he is a member.” As a result, provisions of the Code which contemplate an employmentrelationship are not available to partners in a partnership.

FaskenMartineau DuMoulin LLP v. BC Human Rights Tribunal and John McCormick