AICPA Urges EEOC to Halt Investigations of Accounting Partnership Retirement Practices

November 20, 2014

Word partnership in dictionaryIn a letter to the Equal Employment Opportunity Commission (EEOC), the American Institute of CPAs (AICPA) has asked Commissioners to reject staff appeals to investigate and litigate against accounting firms regarding partner retirement provisions, saying the classification of partners as employees would be very disruptive to the accounting profession and its business practices.

In the October 20 letter, AICPA President and CEO Barry C. Melancon, CPA, CGMA, explained, “We understand that the EEOC staff is currently investigating and considering litigation against accounting firms regarding the partner retirement provisions in their partnership agreements.  You will recall that less than eighteen months ago, the EEOC staff completed a similar investigation of another large accounting firm.  As the EEOC General Counsel’s office wrote in its July 25, 2013 informal comment letter, control – meaning whether partners control their own work and own and control a portion of their firms – is the touchstone to the determination that they are indeed partners rather than employees.  Because of the nature of the accounting profession, we believe that the partners of our member firms – like the firms the staff is investigating – do have such control and that the EEOC should not bring actions against these firms.”

The AICPA is encouraging Commissioners to exercise their authority to reject any attempt by the General Counsel to file litigation with respect to accounting partnership retirement practices.  Further, the Institute is requesting that Commissioners direct the EEOC staff and General Counsel to “stop these unwarranted and unnecessary investigations of accounting firm partnerships and utilize the Commission’s resources in a more productive manner that will address actual discrimination practices.”