Vicarious Liability – What Employers need to know

Vicarious liability is a common law theory which means that employers may, in certain circumstances, be held responsible for the wrongdoing of their employees, despite the employer not necessarily having committed a wrongdoing themselves.

This includes wrongful acts during the course of their ordinary employment. What is deemed to be within the employees’ ordinary course of employment varies according to different circumstances.

Although vicarious liability does not eliminate liability of the individual wrongdoer, it often ensures an appropriate remedy for the victim as the employer often has more resources available.

Actionable wrongdoings which employees may commit during their employment are wide-ranging, holding many consequences for employers through vicarious liability. Examples may include things such as negligence, causing a loss to be sustained by the opposing party, or an injury in the work place, acts of violence or sexual abuse towards another employee, or a breach of data protection regulations and discrimination.

A “close connection” test must be satisfied. It must be established whether the wrongdoing was so closely connected with the acts which the individual was permitted to undertake. If this is deemed to be the case, it is then ascertained as to whether the acts can fairly and properly be deemed as having been done during the course of their employment or their relationship akin to employment.

Unfortunately for employers, a sufficiently close connection has been established in surprising and shocking circumstances. For example, In the case of Lister v Hesley Hall Ltd [2001] the employer of a warden was vicariously liable for his sexual assault of boys who were resident at a boarding school on the ground that he was entrusted to care for children.

In Bellman v Northampton Recruitment Ltd [2018] following an assault by a managing director on an employee of the company at an out of hours drinking session the Court of Appeal found that although the drinking session was not a seamless event with the works Christmas party, there was sufficient connection between the managing director's field of activity and his wrongful conduct to make it right that the defendant be held vicariously liable.

In Mattis v Pollock [2003] the claimant was stabbed by a nightclub doorman. The attack occurred away from the club and some time after an earlier argument which had taken place in the club. The Court of Appeal concluded that vicarious liability arose because the attack was related to events which occurred within the club and the doorman was authorised to use force as part of his duties. The act was established to have a close connection with his duties as a doorman to carry out his role in an aggressive manner.

The need to be aware of their potential susceptibility to being held vicariously liable for the actions of employees is of particular importance given the shift in trend to individuals often choosing to work from home and the consequential lack of direct supervision.

Employers can take steps to prevent becoming vicariously liable through offering additional training on things such as GDPR and IT and implementing and re-enforcing policies and procedures.

The employer can in certain situations recover the loss sustained arising from being held vicariously liable for the employee’s actions. For example, a claim under section 1 of the Civil Liability (Contribution) Act 1978 allows the employer to recover a contribution towards the damage.