Client Update: Professional Partnerships Breathe Easier
This morning the Supreme Court of Canada released its much awaited decision in McCormick v. Fasken Martineau DuMoulin, holding that most legal (and other professional) partnerships are not subject to Human Rights obligations to partners, because there is no “employment relationship” between a firm and its partners. In the Fasken’s case, the issue was the partnership provision which required an equity partner to retire at age 65, a provision common in most professional partnerships. While partners were subject to various policies and administrative rules, the Supreme Court formulated the analysis as one of control and dependency:
…the test is who is responsible for determining working conditions and financial benefits and to what extent does a worker have an influential say in those determinations?
The Court very strongly expressed the view that in most partnerships equity partners have a right to participate meaningfully in the decision making process. The partner in question was “part of the group that controlled the partnership, not a person vulnerable to its control.”
The Supreme Court noted that in some jurisdictions – most notably the United Kingdom, Australia and New Zealand – there are specific statutory provisions which make employment legislation (including Human Rights) applicable to partnerships. The Court noted also the duty of fairness and good faith specifically set out in the B.C. Partnership Act but then added that it would be difficult to see how that duty could preclude a partnership from instituting a mandatory retirement policy “designed to benefit all partners by ensuring the regenerative turnover of partnership shares”.
One final note: professional partnerships must still take care that not too many energized senior partners “jump ship” late in their careers.
Archive
Perlene Morrison Prince Edward Island’s municipal legislation is being modernized with the implementation of the Municipal Government Act (the “MGA”). The legislation has now received royal assent and will be proclaimed in force at a future date.…
Read MoreJonathan Coady and Chera-Lee Gomez It’s that time of year – the moment when we look back at the year that was and chart our course for the year ahead. For many councillors, administrators and planning professionals…
Read MorePeter McLellan, QC and Michelle Black In a recent decision, R v McCarthy’s Roofing Limited, Judge Anne Derrick provided some much-needed clarity around what it means to be a “constructor” on a job site. This is critical as…
Read MoreRick Dunlop On December 13, 2016, the Government of Canada released A Framework for the Legalization and Regulation of Cannabis in Canada: The Final Report of the Task Force on Cannabis Legalization and Regulation (“Report”). The Report’s…
Read MoreBrian Johnston, QC Canadian employers are already coping with approximately 75,000 Canadians authorized to use medical marijuana. Health Canada expects that this number will increase to about 450,000 by 2024. Employers know that medical marijuana…
Read MoreJonathan Coady With its decision in Canada Post Corporation v. City of Hamilton,1 the Ontario Court of Appeal has confirmed that the placement of community mailboxes by Canada Post is a matter beyond the reach of municipalities…
Read MoreJennifer Taylor Introduction Thanks to some dirty windows, insurance lawyers have a new go-to Supreme Court case on issues of policy interpretation: Ledcor Construction Ltd v Northbridge Indemnity Insurance Co, 2016 SCC 37. The insurers in Ledcor Construction had…
Read MoreJennifer Taylor Introduction Appeal courts in Ontario1 and Nova Scotia2 have now issued decisions about Trinity Western University’s proposed law school (“TWU”) in British Columbia, and at first glance they couldn’t be more different. The Court of Appeal for…
Read MoreJoe Thorne1 and Giles Ayers2 Limitation periods serve a critical function in the civil justice system. They promote the timely resolution of litigation on the basis of reliable evidence, and permit litigants to assess their legal exposure…
Read MoreOn July 14, 2016 the Supreme Court of Canada issued a significant decision affecting federally regulated employers across Canada. In Wilson v. Atomic Energy of Canada Limited the Court held that the purpose of the unjust dismissal…
Read More