A partner is not always just an owner

An equity partner in a law firm can be considered an employee and therefore can go before the British Columbia Human Rights Tribunal to get redress for alleged human rights violations, the B.C. Supreme Court ruled in Fasken Martineau DuMoulin LLP v. British Columbia (Human Rights Tribunal).

The case  concerns Fasken Martineau DuMoulin LLP partner John Michael (Mitch) McCormick, who was asked to retire when he turned 65 on March 28, 2010. The retirement requirement is spelled out in an equity partnership agreement with the partner starting the transition when he or she reaches the age of 62. B.C. no longer has mandatory retirement at 65 and since McCormick wasn’t ready to retire, he took the unusual action of taking his firm to the B.C. Human Rights Tribunal claiming age discrimination. The tribunal agreed to hear the case, accepting McCormick’s argument that being an employee extended beyond the common law definition.

Faskens asked the B.C. Supreme Court for a judicial review of the tribunal’s jurisdiction to hear the case. It argued McCormick was not an employee but rather an equity partner and therefore fell outside the tribunal’s scope.

In June 2 reasons for judgment, Justice Catherine J. Bruce said if it was a business partnership it might preclude any ability to file a complaint to come before the HRT. But, McCormick’s partnership position didn’t fall into that category.

“Mr. McCormick is an equity partner with very little control over his work life, his remuneration and his work product,” said Bruce. “In this partnership, an individual equity partner cannot determine his own wages and working conditions. Nor does he have the power, though his voting rights or his bargaining strength to change the partnership agreement in ways that would be favorable to him. An individual partner is always subject to the wishes of the majority and the control exercised by the managing partners and the executive board. It is by these means that the firm represents a relationship with Mr. McCormick that is more reflective of an employer/employee relationship, favouring an overall finding that Mr. McCormick is ‘employed’ by Fasken for the purposes of the [human rights] code.”

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