An important but potentially confusing aspect of English law is the concept of the “legal person”. As well as individuals a limited company is a legal person in the sense that it has its own legal status. It can be a claimant or defendant in proceedings and can enter into contracts, whereas the position with a partnership (a collection of individual persons trading together) is more nebulous.
Perhaps the obvious reaction when considering whether a company can be a victim of discrimination is to say that it cannot since discrimination is specific to a human being who can, for example, suffer injury to feelings. However, as confirmed in the case of EAD Solicitors LLP and others v Abrams the legal answer is not so straightforward.
Mr Garry Abrams was formerly a partner/member in EAD Solicitors LLP, based in Liverpool. Indeed, the firm was previously known as Edwards Abrams Doherty. As he approached retirement Mr Abrams set up a limited company in which he was the sole director. The company replaced him as a member of the LLP. It was, for all intents and purposes, a service company which provided the services of Mr Abrams and was, in return, entitled to share in the profits of the LLP.
There was no obligation requiring personal service and therefore no employment relationship. The LLP objected to the company providing Mr Abrams’ services once he reached the age when, had he been a member of the LLP, he would have retired. There was an ongoing dispute about whether the company remains a member of the LLP notwithstanding the claim and that apparently remains unresolved.
Part 5 of the Equality Act 2010 provides that an LLP (limited liability partnership) must not discriminate against a member as to the terms on which he is a member, by expelling him, or by subjecting him to any other detriment. Section 4 of the Limited Liability Partnership Act 2000 provides that a corporate body may be a member of an LLP. This is therefore the legal basis on which a corporate LLP member does, on the face of it at least, enjoy protection from discrimination. Any such claims must be brought before an employment tribunal (section 120 Equality Act).
In the Employment Tribunal Employment Judge Ryan clearly struggled with the concept of a company being a victim of discrimination because it is so intensely personal. However, he was persuaded by the legal argument that it could. President of the Employment Appeal Tribunal Mr Justice Langstaff agreed. He referred to the skeleton argument put forward by Counsel for Mr Abrams who put it as follows:
[The Claimant} alleges direct discrimination (by association) pursuant to section 13 [of the Equality Act]. For such a cause of action [the Claimant] does not need to possess the protected characteristic relied upon. Direct discrimination will have occurred [the Respondent] has treated [the Claimant] less favourable because of Mr Garry [Abrams’] age (subject to the justification defence.
[The Claimant] avers that, in the context of section 45(2)(d), section 13(1) should be read as follows: “An LLP discriminates against a member if, because of a protected characteristic, an LLP treats a member less favourably than an LLP treats or would treat others.” If section 13 [of the Equality Act] is read in this way, then all [the Respondent] need prove…is that it is/was a member of the LLP. As this was not in dispute Employment Judge Ryan was correct in his conclusion that the Tribunal does have jurisdiction to hear this complaint.
Counsel for the LLP asserted that only an individual can have a protected characteristic. Only an individual could be said to have age, disability, be subject to gender reassignment, be entitled to marriage and civil partnership, enjoy pregnancy and maternity, have race, religion or belief, sex or sexual orientation. Mr Justice Langstaff agreed. However he pointed out that this misses the point that the Equality Act “does not deal with individuals on the basis of their protected characteristics but identifies discrimination as being detrimental treatment caused by the protected characteristic or related to it. Detrimental treatment can be given to any person, whether that person is natural or legal.”
Is this what Parliament intended? Well, that is a different question. Based on the law as it stands it is difficult to argue with the logic of the argument which was accepted by Employment Judge Ryan and Mr Justice Langstaff. It is reasonable to conclude that the company effectively stood in the shoes of Mr Abrams but it is also reasonable to assume that Mr Abrams enjoyed the benefits of providing his services through a limited company, such as favourable tax treatment. Is it fair for him to have it both ways. That question did not need to be decided by the Tribunal or the EAT.