Attorney was not covered by the salaried employess act

The Eastern High Court surprisingly concluded that an attorney and partner at a law firm did not enjoy employee status and was therefore not covered by the Salaried Employees Act, the Holiday Act or the Contract of Employment Act.

Whether a person is a salaried employee is important for the person's rights as employee status implies that the person is protected by a number of acts. In Denmark, the concept of salaried employee is not clear, but often a salaried employee is defined as a person receiving salary for personal work under a contract of employment.

DISTRICT COURT: EMPLOYEE STATUS COVERED BY THE SALARIED EMPLOYEES ACT

In the specific case, a salaried partner at a law firm had terminated her employment and, in this connection, the parties disagreed on the nature of the partner's employment.

The district court attached importance to the partner's monthly salary, which had been paid as income taxed at source, and that she did not receive any part of the profit or have a vote at partner meetings. Furthermore, the court found that the law firm had complained about the partner's client composition and the manner in which she invoiced her clients. The fact that the partner was obligated to devote the whole of her attention, time and skill to the law firm, that she needed approval of book purchases or seminar registrations and that she did not have managerial rights in relation to other employees indicated, in the district court's opinion, that she was a salaried employee and therefore covered by the Salaried Employees Act.

Based on the above, the district court found that the partner had employee status and was therefore covered by the Salaried Employees Act, the Holiday Act and the Contract of Employment Act.

THE HIGH COURT REACHED A DIFFERENT RESULT

The High Court found that the partner did not have employee status and was therefore not covered by the Salaried Employees Act, etc. The High Court attached importance to the fact that the partner had been employed to build up a division without any help from others and in this connection she had brought her own cases and was expected to attract her own cases and clients. In addition, the High Court found that she was not subject to any powers of direction as she worked alone and could arrange her own working hours and performance. Finally, the High Court found that the complaint about the client composition did not constitute an order to take on specific clients.

COMMENTS

According to case law, there are certain general guidelines according to which only the senior management/persons are undoubtedly considered consultants, who are not covered by the  salaried employee concept.

The High Court ruling is therefore very surprising and not in line with previous case law as the partner in question was an employed attorney with the title of partner, received a fixed monthly salary and did not have any controlling interest or ownership in the law firm or any other managerial rights in relation to other employees.

In our opinion, the High Court attaches great importance to the partner's independent role with the start-up of a new division and expected influx of new cases. In our opinion, this is not sufficient in order to consider the partner a part of the senior management.

Please note that the financial outcome of the High Court ruling was more profitable to the partner, even though the High Court did not rule in favour of the partner as regards employee status. This may have influenced the outcome.

contacts

Marianne Lage

Partner

Christian Traberg Bennetzen

Attorney