You don't need full parties to form an Alliance. Both party leaders must be in the same zone to form one. If a leader leaves the zone or changes jobs the alliance will break up.

My FC did a 7 man & 5 man Alliance when Diadem first came out. Only problem we had was the glitch that Kick the Leader of Party #2 out onto the front yard while the rest of us went into Diadem. Thankfully the glitch is fixed now.