The law allows claimants to bring a tribunal complaint outside the usual three-month time limit if it amounts to “conduct extending over a period”. In Parr v MSR Partners LLP (formerly Moore Stephens LLP), the Court of Appeal held that the demotion of an equity partner constituted a one-off act with continuing consequences, as opposed to conduct extending over a period.
Basic facts
Mr Parr was an equity partner at MSR Partners LLP, a firm of accountants. Under clause 29 of the members’ agreement, the normal retirement age for all partners was 60, unless there was a valid business reason for extending it.
By that formula, Mr Parr’s normal retirement date should have been 30 April 2018. However, the parties reached a De-Equitisation Agreement in October 2017, allowing him to stay on for a further two years as an ordinary, as opposed to equity, partner. In September 2018, Mr Parr found out that the business was going to be sold, and in December was told that he was not entitled, as a non-equity partner, to a share in the substantial proceeds of the sale. He brought a claim for direct age discrimination in January 2019.
Although this was outside the three-month time limit for lodging a claim under section123(1)(a) of the Equality Act 2010, Mr Parr argued that the claim related to “conduct extending over a period” (also known as a continuing act) under section 123(3)(a) and had been ongoing when the claim was filed.
Tribunal and EAT decisions
The tribunal judge found that, as a result of the rule in the partners’ agreement, Mr Parr was demoted on 30 April 2018. As long as that rule was in force, it constituted a continuing act which resulted in Mr Parr’s less favourable treatment. As such, his claim was in time.
Upholding the appeal by the partnership, the EAT (weekly LELR 735) held that the effect of the change from equity to non-equity partner was a one-off and permanent alteration to Mr Parr’s status and the alleged losses derived from that event. It was therefore “an act which had continuing consequences, rather than conduct which extended over a period. It was a specific one-off decision on the particular facts of the claimant’s case, not the application of a rule in accordance with which multiple decisions were taken from time to time … or the continuous application of a policy, rule, scheme or practice”.
Decision of Court of Appeal
The court accepted the partnership’s argument that the requirement for a partner to retire at age 60 under clause 29 could only be applied once to any individual. In Mr Parr’s case, it was applied on 30 April 2018, after which it “disappeared into the rear-view mirror”.
The specific act at the heart of Mr Parr’s complaint was the act of de-equitisation. In other words, he was complaining about a demotion. Had Mr Parr’s membership of the LLP simply been terminated on 30 April 2018, time would have run from that date. Even if that dismissal had been discriminatory, it would have constituted a one-off act with continuing consequences, as opposed to conduct extending over a period, even though he would have suffered a loss of pay and pension for the rest of his life.
As there was no logical reason why a demotion should be treated differently from a dismissal just because Mr Parr and the partnership remained in a contractual relationship, the claim was out of time.
The Court of Appeal remitted the case to the tribunal to decide whether it was just and equitable to extend time.
Comment
The judicial analysis in this case of the difference between one-off acts (often involving the exercise of discretion) and continuing circumstances (involving the application of policies or rules) provides a helpful framework for anyone considering the thorny issue of time limits.