Vicarious Liability and Its Limitations in Employment Relationships

Introduction

Vicarious liability is a state where an employer is held accountable for the torts committed by their employee in the course of employment against a third party. However, English law states that every individual should be accountable for their sown deeds, contrary to the vicarious liability where an individual is held responsible for the wrongdoings done by a different person. This liability only happens when one party is socially higher or superior to the other party, such as a master and employee or servant. As a result, the superior party is held accountable for the actions of the less superior party. Conversely, before imposing vicarious liability, there are several justifications that have to be met.

One of the justifications is that the roles played by employees in an organization or business benefit the employer. Considering this, liability following the deeds of the employee should be applied in the same way. That is to mean that following the wrongdoings or torts done by the employees, the employer should be held accountable (Azmat, 2020). Moreover, services rendered by the employees tend to profit the employer and should therefore develop an effective culture to guide the stakeholders as a result.

A good example to demonstrate this is an instance where a milkman decides to help an elderly woman collect milk because he feels it is courteous. Unfortunately, the elderly woman gets injured in the process following an accident. As a result, the elderly woman is liable to sue the employer for the milkman for compensation due to the injury caused by the milkman. This is because the milkman seems to have work overload or assigned a lot of work that necessitates an assistant, yet the employer has not decided to assign one yet (Beatty and Samuelson, 2015). The milkman acted to benefit his employer and his job while trying to carry out the task assigned in helping the elderly woman collect the milk. The employer tends to benefit when the milk is delivered in time. Following the same reasoning, the employer is expected to take responsibility for every casualty that arises when the milkman attempts to complete his duties.

Main Body

Another justification for vicarious liability is negligent entrustment and control of the actions of the employees. The employers possess the highest control degree over the workers or workforce in addition to having the authority to dismiss employees. The employers are permitted by the legal doctrine of vicarious liability to take the responsibility of constantly instilling discipline and appropriate work ethics (Goldberg, 2021). As a result, the employer has to make sure that the organization personnel has the relevant skills required to complete and execute their roles or duties. The court perceives that it is fair to impose vicarious liability on employers if they fail to effect control on employees and the employees commit torts.

A good instance that demonstrates negligent supervision or entrustment is a scenario of a teaching hospital where the doctors or physicians are responsible for supervising, guiding, and observing nursing and medical students as specified or stated in their mandate in the medical facility. Patients hold the right or are allowed to place a claim on physicians instead of the interns if they incur injuries as a direct outcome of negligence on the physicians’ part to supervise the medical and nursing interns (Keating, 2021). This is because health providers have the responsibility to make sure that the individuals providing clinical services to the community or society have necessary qualifications in addition to efficient or sufficient supervision and appropriate certification.

A similar scenario is where nurses do not have the appropriate or proper current certifications in cardiopulmonary resuscitation. Since the nurse has limited knowledge of the steps to be taken in case a patient undergoes cardiac arrest. Therefore, the nurse can pass the liability onto the supervisor that was unable to supervise active certification (Lybecker and Watkins, 2015). The reasoning displayed in the two scenarios has become common today where vicarious liability is imposed on the employers for the torts done by their employees due to inadequate supervision.

Additionally, having deep pockets is considered a justification for holding employers liable or responsible for the torts committed by their employers. This is because employers can take care of claims that workers will not be able to afford because they have or possess more money because of their financial positions compared to their employees (Peters, 2020). This view comes from the deep pocket theory that in addition to employers having more money, they can as well distribute these risks or costs on claims to various sources, including insurers, shareholders, product prices, and customers. Since employees are financially checked by their employers, they lack access to loss distribution channels. Additionally, since employers are able to cover the costs of claims compared to employees, this justification has been considered to cover social convenience as well as public policy.

Another justification for imposing vicarious liability is spreading risks. Vicarious liability is considered as a means of distributing loss and protects the victim from the dangers that can be imposed by the offender’s employer. The general view here is that the created danger by the organization should be endured by the firm itself. This is because the employers are capable of distributing this loss to a large pool because they are insured, which enables them to remain catered for or covered (Priel, 2020). Consequently, the employees do not take full responsibility for the torts they commit while working. The employers also have to be accountable since the employees were following their orders. This follows the idea that the employees experience more impact from claims compared to their employers.

Loss distribution can be categorized into two versions that are legal and social. In relation to the social outcome, the exercise happens when employers spread or distribute losses to other individuals. For instance, business people are able to distribute their risks by raising product prices. Therefore buyers or consumers assume the vicarious liability costs as a result. The victim of the wrongful act has no absolute power or jurisdiction to take legal action against the bearers of the financial cost (Sawicki, 2019). Loss distribution in relation to the legal outcome, on the other hand, is an exercise where the cost is distributed by making another individual legally accountable for the victim loss over the direct claim or vicarious liability.

Notably, the spread of loss considered a legal result does not constantly offer a justification that is practical or viable. Therefore, it is not always used because the cost can be distributed to several defendants. The victim of a tort is not able to take legal action or sue vicariously viable defendants directly because of the artificial nature of the loss spreading legal outcome. Employers seeking cover through insurance is considered the most pronounced concept of distribution of loss. Defendants can spread their created risks to be covered by an idea of swaying claims that are outcomes of insured risks such as workers’ misconduct against the insurer. For instance, a pupil crossing the road while heading to school was hit by a truck driver doing a hurry morning delivery, hence incurring a critical injury (Sharkey, 2018). The pupil or student, in this case, is allowed to sue the truck driver’s employer to account for compensation liability. The truck company can spread the risk incurred to be covered by its insurer.

How the Courts Have Limited the Scope of When Vicarious Liability Can Be Imposed

Following the employees’ tortious acts, employers are only liable if there is a sufficient relationship or connection between the role of the employee and the activities that occurred to create the liability. This includes the activities that employers have explicitly allowed their employers to do in the course of their employment in a way that the tortious act may be properly and justly be considered to be committed by the employer (Sugarman and Boucher, 2021). Vicarious liability can also be generated following acts that are closely related to the employees’ responsibilities and roles. This means that the liability does not rely on the employees being allowed to perform a certain activity where it is sufficient that they have been authorized to do the activities which created the harm.

The courts have set up legal tests that have to be met before employers are found to be vicariously responsible for their employee’s torts in the course of employment. These tests include relationship and close connection tests. For the relationship test, there has to be a relationship between the employee and the employer (Swan, 2019). This relationship makes it appropriate to hold the employers accountable for their employees’ torts. In the close connection test, a connection must be identified between the employment and tort.

There are two factors that describe the operation of the close connection test. One of which is the nature or type of the role and responsibility of the worker, including the nature of the field of activities that the worker has been instructed to perform by the employer. The scope of responsibility of the worker is determined by the response to the question on the nature of the role of the employee (Tilley, 2019). The answer determines the closeness of the connection. The second factor is sufficient connection which can be defined as the association present between the position and responsibility of the employee in the organization and the tort.

Additionally, the tort has to be associated sufficiently with the conduct authorized by the employer to warrant the imposition of the vicarious liability. Employers can be liable for any individual’s torts whose roles and responsibilities are similar to that of the employees. Therefore, the relationship between employers and employees does not strictly limit vicarious liability (Wheeler and Benz, 2020). It is also not limited to any tort done within the course or scope of employment. However, vicarious liability can include any tort that is linked closely with what the employee was instructed to do by the employer.

Before suing an employer on their employees’ torts, a claimant has to prove that the offender is not an independent contractor hired to carry out certain roles but is the employer’s employee. This is because the independent contractors work or function under a contract for services rendered or provided, at their own risk and in their own arrangement. In general independent contractors and employees are very similar since they all work under the employer. This means that none of them can decide on their choice of activities or responsibilities (Wright, 2017). The employer assigns work to both of them but is only vicariously liable for the tortious acts of the employee.

The general rule is that an organization will not be held liable for any tortious activities done by a contractor in the performance of their engagement. Conversely, there may be events or circumstances where the association is taken as similar to employment for reasons of vicarious liability when it comes to quasi-employees or non-employees (Gilker, 2016). Employers are responsible for their employees’ tortious acts or any individual whose responsibility is like that of an employee, including employees employed in the scope of the employer’s business under an employment service contract.

The UK Supreme Court identified several policy factors in their decision of Barclays Bank plc where it can be considered reasonable, fair, and just to find employers vicariously liable following their employees’ tortious acts. The factors that the Supreme Court confirmed include where the particular activity composing the employer’s activity. Another factor is where the tortious act is done, resulting in an acidity taken in benefit of the employer (Mann and Roberts, 2019). Also, the employer creates a risk of the vicarious act done by the contractor employed to do the activity. The last factor is where the contractor who committed the tortious act was under the control of the employer to a lesser or greater level.

Following these factors, Barclays Bank was not found to be vicariously responsible for the sexual assaults committed by an independent medical practitioner Dr. Gordon Bates against prospective employees who were referred to him for the purpose of work fitness necessary for work assignments. Dr. Gordon Bates was hired by Barclays bank to carry out medical examinations and assessments of Barclays employees. Dr. Bates did not have an employee relationship or similar to that of an employee. He did business on his own account and did work not only for Barclays Bank but for other patients and clients as well (Marson and Ferris, 2020). Barclays bank decided on the questions to be answered during the medical examinations. Also, he conducted medical examinations at a fee and was, therefore, eligible to decline a medical examination. Barclays claimed that Dr. Gordon Bates was contracted to the task independently, yet the doctor tried to show that he was under the factors.

The doctor possessed his medical liability insurance even though his reports were filled on a form containing the bank’s logo. This follows the fact that the medical practitioner attended to other patients apart from the ones referred to him by Barclays Bank as he could decide to decline a patient referral since he was given a fee for every assessment report, yet there was no retainer (Mèantysaari, 2012). Conversely, the court acknowledged that it was necessary to consider several factors in determining if there exists a relationship similar to employment when there is doubt if the offender was acting on their independent business. The outcome of this approach is that any other relationship besides employment relationship is able to create employer vicarious liability.

The claimant also has to prove that the offender committed the wrongful act as per the general rules of vicarious or tortious liability. Lastly, the claimant must prove that the wrongful act took place in the course of employment, which can be very challenging to demonstrate. The House of Lords emphasized that it was important to consider the wide approach to determine the type of employment. It also encouraged the use of the wide approach for the court to consider if the wrongful act is closely associated with the environment justify or be fair and reasonable to impose vicarious liability on the employer (Nagel, 2019). Additionally, the House of Lords advised utilizing the broad approach in determining if the wrongful act comes under a risk that is created by the organization or company that is considered essential or inherent.

A good example of the close connection test’s application was illustrated by the case of WM Morrison supermarkets in the UK. A Morrison’s supermarket employee intentionally released or leaked on the internet the personal data of employees in an attempt to take revenge against a workmate with whom he had a grudge. Andrew Skelton was given a role in Morrisons internal audit team (Sharkey, 2018). He took resentment when he received a disciplinary warning. He decided to make a copy of payroll information when he was tasked to deliver or convey the information to an external auditor. Mr. Skelton then posted the copy on a website that was publically accessible. In addition, he forwarded the payroll information to three newspapers which then informed the Morrisons of the breach of payroll information. Morrisons then informed the police and took necessary precautions ensuring that the information was inaccessible. Mr. Skelton was arrested and sentenced to eight years despite his attempts to cover his acts.

It was claimed that the Morrisons supermarket was responsible or accountable for their employee’s tort act, including data protection breach, after a group of affected employees brought forward a claim for the distress they experienced in the lower courts (Sharkey, 2018). The employees who had suffered victimization following the breach of data brought claims against Morrisons for several reasons. These reasons included breach of data, misuse of personal or private information as well as breach of confidence. Morrison’s was found to be responsible for Mr. Skelton’s act since the close connection between the unauthorized disclosures and what the employee was assigned to do.

However, the Supreme Court rejected these findings by holding that it was insufficient to determine vicarious liability even if the employee could not have leaked the employees’ data if he had not been assigned to compile it. This is because his action and behavior were not sufficiently associated with the tasks that he was assigned to in the regular employment course. The Supreme Court reversed the lower courts’ decisions that have misinterpreted the governing principles of vicarious liability. The lower courts had misinterpreted governing principles in four ways. First, the lower courts interpreted the field of activities tests very widely. The vicarious act claimed was not part of Mr. Skelton’s scope of activities within the organization. It was not part of the activities that he was tasked to do in his company roles and responsibilities (Sharkey, 2018). Second, the lower courts used a five-factor system appropriate in determining if there exists a vicarious liability between an employee and an individual that was not an employee yet has a relation similar to employment. This instance had no grounds on Mr. Skelton’s case because he was an employee of the Morrisons. Third, the lower courts decided inaccurately that the close connection test had been met or satisfied.

The Appeal Court also indicated that an unbroken chain of causation and a close temporal link existed between Morrison providing data for Mr. Selton and his illegal leak, which was considered to satisfy the test. However, the Supreme Court had a different view and decided that it was not sufficient to meet the close relationship test. Lastly, the lower courts said that the intention of Mr. Skelton was not relevant (Clarkson, Miller and Cross, 2017). The Supreme Court decided that intention was a great determinant or factor to consider. The employee had engaged in the task in his own interests without authorization. That is, instead of working on the roles given by the employer, Mr. Skelton was acting in his own interests.

The Supreme Court further said that a situation where the employee had been found already to be acting for the benefit of his employer or his employer’s business is where the motive was irrelevant. As a result, the Supreme Court concluded that Morrisons was not responsible for the tortious acts committed by Mr. Skelton and hence was not vicariously liable (Clarkson, Miller and Cross, 2017). The court then stated that it was not mandatory for them to consider an appeal for the second issue following their conclusion on the necessary conditions that determine the imposition of vicarious liability. Conversely, the court held that it was sufficient that it should express its view given the second issue had been argued fully.

Nevertheless, the Morrisons supermarket can be used as a blunt reminder of the employer’s liability potential for activities carried out by rogue employees in the course of employment or in relation to their job responsibility. In further examples, if an employee applies an inflammable fluid to his workmate or friend work uniforms and burns them for fun, the employer will not be responsible for the employee’s actions (Clarkson, Miller and Cross, 2017). Also, religious proselytization using a locum resulting in mental harm to the victim could not be considered a fair and reasonable risk to the business of continuing a surgery of a health practitioner.

Conclusion

In conclusion, the state where an employer is found liable for the wrongdoings committed by their employees. However, some justifications have to be met before considering the employer vicariously liable. These justifications include the roles that employees play in the organization of the employer. Another justification for this liability is the negligent entrustment and control of the personnel’s actions. Also, employers are well of financially or have deep pockets compared to their employees and finally spreading risks.

However, the courts have limited the scope of when the liability can be imposed upon the employer. The employer is only liable for the torts of their employee if there is sufficient connection between the role of the employee and the acts that took place to create the liability. The courts have also set up legal tests that have to be justified before holding an employer liable. The wrongful act also has to be associated adequately with the role authorized by the employer. Additionally, the claimant has to provide sufficient evidence that the offender is not an independent contractor but is employed by the employer. Moreover, the claimant has to prove that the tort occurred in the course of employment. Lastly, employers are held liable if contractors are working under their control.

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