A solicitor who was paid through a profit share rather than receiving a salary should not be classified as a partner for employment law purposes, the Employment Appeal Tribunal (EAT) has ruled.

Solicitor Jeremy Briars began working for Solihull firm Williamson & Soden in November 2001. While he was initially paid a salary of £55,000, an agreement was then made to pay a guaranteed profit share of the same amount, plus one-eighteenth of the firm’s net profits.

This allowed Briars to defer income tax payments, and reduced the national insurance payable by the firm.

However, following Briars’ departure from the firm, the solicitor brought an employment claim against it. The firm contested the claim on the grounds that Briars was a partner rather than an employee, and did not therefore have grounds to bring a claim.

Last September the tribunal found that Briars was an employee, not a partner, and so it should proceed to hear the case.

The firm appealed this decision to the EAT, where Mr Justice Langstaff dismissed its appeal last week, confirming that Briars was ‘plainly’ an employee. His reasons included the fact that Briars had no capital stake in Williamson & Soden, was not being consulted by the equity partners about significant events affecting the firm, and did not risk losses incurred by the firm.

The firm had also asked Briars to sign a compromise agreement, which was standard practice with employees, but not with partners or the self-employed.

Briars’ case will now be returned for hearing at the employment tribunal, expected at the end of January 2012.

Williamson & Soden senior partner Ian Williamson said he could not comment until after the full hearing.

Briars did not provide a ­comment.