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Whistleblowing Partner Not Protected

PLEASE NOTE: Information in this article is correct at the time of publication, please contact DFA Law for current advice on older articles.

A ‘worker’ who acts as a ‘whistleblower’ – disclosing breaches of the law – receives statutory protection under the law if he or she suffers detrimental treatment as a result of having made the disclosure to the appropriate authorities.

Recently, a partner in a professional firm acted as a whistleblower, accusing a fellow partner of engaging in criminal activity including money laundering and bribery.

She claimed to have suffered a detriment and sought to rely on the legislation protecting workers, claiming that her disclosures were ‘protected disclosures’. However, the Court of Appeal rejected her argument, concluding that for such disclosures to be protected by the legislation, there had to be ‘a hierarchical relationship whereby the worker is to some extent subordinate to the employer’. This could not apply to an equity partner.

The confirmation that the whistleblowing legislation does not protect equity partners puts someone who becomes aware of criminal misdeeds on the part of their fellow partners in a difficult position, particularly as partners can be jointly and severally liable for losses to the partnership that result from the activities of their fellow partners. If you find yourself in such a position, contact Gary Lee for advice on what steps to take.

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