What should you know about vicarious liability
The concept of vicarious liability – an employer’s ‘joint’ responsibility for the actions of an employee – is something that can cause major headaches for employers.
When employees behave poorly in a work-related setting, there can be severe consequences for both the employer and the worker – e.g. dismissal for the employee and/or reputational damage for the employer.
However, under the concept of vicarious liability, as an employer, you may also face consequences due to the actions or behaviour of an employee.
So, what are the implications for you and your business? And how can you protect yourself against the challenges of vicarious liability?
What exactly is vicarious liability?
According to this concept, you may be considered liable for actions committed by an employee, including discrimination, harassment and wrongful acts if it is proven you did not take reasonable steps to prevent this from occurring.
For vicarious liability to apply, these actions must occur in connection with the course of an individual’s employment – e.g.
- Sexual harassment
- Racial discrimination
- Workplace bullying
- Wrongful acts
An extreme example can be found in a recent Supreme Court case appeal, where an employer was found to be vicariously liable after one employee urinated on another while they were both in shared accommodation.
The incident occurred while the two employees were sharing on-site accommodation provided by their employer. One of the employees became intoxicated while drinking at the employee bar, and after returning to their shared accommodation, began urinating on his sleeping colleague.
While the ruling of the original case favoured the employer, “the Court of Appeal found that the requirement to live in the shared accommodation at the facilities provided placed a degree of liability on the employer to ensure safety and security for employees.”
As the team at NB Lawyers notes, “had the employer not required employees to live in the provided accommodation they would likely not be found to have been vicariously liable.”
While this was something of a unique case, other examples of employers being found to be vicariously liable range significantly in nature.
Other examples in which employers were found to be vicariously liable include sexual harassment in shared accommodation during a work conference, and a situation “where racial discriminatory remarks in the workplace were made by, or in the presence of, a supervisor and were therefore considered to be condoned by the employer.”
What about outside the office?
As some of the previously mentioned cases demonstrate, you may be found to be vicariously liable for the actions of employees in a range of settings and situations.
The key consideration is whether or not there is a legitimate connection to employment by the organisation.
While many incidents may take place in the office during work hours, the concept of vicarious liability also extends to settings outside the office where it can be proven there is a connection to the employment of the individual in question – e.g.
- employer-sponsored events, such as seminars, conferences and training workshops
- work-related social functions (e.g. Christmas parties)
- business or field trips
As such, it is important for you as the employer to be aware you may still be considered responsible for the actions of workers ‘outside the office’.
What can you do as employer?
There are a number of strategies you can implement to mitigate the risks of vicarious liability.
First and foremost, this involves being able to demonstrate that all reasonable actions were taken to prevent the actions or behaviour in question.
While some strategies may vary depending on the specific workplace, it is important to ensure there are clear policies and guidelines in place regarding appropriate behaviour in work-related settings.
It is also essential to make sure all employees are aware of (and understand) these policies. There should be at least an annual update on appropriate behaviour through promotion of the policy, revisiting appropriate behaviour standards and spelling out the impact of non-compliance with the policy.
Your workplace environment and culture should be carefully monitored, and any areas of concern addressed as soon as possible after that area of concern is identified.
All complaints regarding harassment, discrimination or other concerning behaviour should be treated seriously and investigated promptly.
Managing the risks presented by ‘out-of-office’ situations may also be beneficial. For example, it may be worth considering avoiding shared accommodation arrangements for employees on work trips if possible, or limiting the availability of alcohol at work-related events.
Akyra’s Key Takeaways
- Employers may be found to be ‘vicariously liable’ for harassment, discrimination and other actions committed against workers if they have not taken all reasonable steps to prevent it.
- Vicarious liability can apply to any setting in which there is a clear connection to a worker’s employment- including settings out of the office, such as Christmas parties or work trips.
- To mitigate the risks, employers should have clear policies in place regarding acceptable behaviour, treat all employee complaints seriously, consider risk management strategies for out-of-office settings and implement regular sessions across your workforce about appropriate behaviour and the consequences of non-compliance.
NEED MORE INFORMATION?
Akyra can help your business to assist and support all your questions and concerns related to vicarious liability. Please contact Akyra on 07 3204 8830 or book a free 30-minute consultation for an obligation-free conversation.
Disclaimer – Reliance on Content
The material distributed is general information only. The information supplied is not intended to be legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice in relation to your specific situation.
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Sources:
https://www.lawyersforemployers.com.au/vicarious-liability-drinking-human-resources-drunk-misconduct-duty-of-care-health-and-safety, https://www.armstronglegal.com.au/commercial-law/qld/employment-law/vicarious-liability-employers/, https://humanrights.gov.au/our-work/employers/vicarious-liability, https://www.qhrc.qld.gov.au/your-responsibilities/for-employers/discrimination-and-harassment-at-work/vicarious-liability#:~:text=Vicarious%20liability%20is%20the%20responsibility,they%20are%20on%20the%20job.
