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28 November 2018

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Vicarious Liability in the Workplace – Where Do You Draw the Line?

Posted by: Russell Brown

The day after an office party usually involves a few sore heads and embarrassing recollections of certain employees’ behaviour and discussions.  But for employers, this might not be the only hangover from the night before – what if a serious incident occurred between staff members?  Who would be legally responsible then?

The recent Court of Appeal ruling that a firm was “vicariously liable” after its Managing Director punched an employee causing them to suffer brain damage at a Christmas party provides employers with some guidance as to how Courts determine the issue.

Sales Manager, Clive Bellman, suffered catastrophic brain damage after being punched to the floor by the Managing Director of Northampton Recruitment, John Major, after an argument broke out about the terms offered to a new employee after the official office party had ended.  The Court heard Major “became annoyed at being questioned” about the hire’s appointment and stated “I f**king make the decisions in this company, it’s my business”.

In 2016, the High Court ruled that the recruitment business was not liable for Major’s actions, stating that the after party at the hotel bar “was, or without any doubt became, an entirely independent, voluntary and discreet early hours drinking sessions of a very different nature to the Christmas party and unconnected with the Defendant’s business”.  However, Bellman appealed and on 11th October, the Court of Appeal overturned the previous decision with the Judges unanimously agreeing that Northampton Recruitment was liable for Major’s actions during the after party.

Lady Justice Asplin ruling, said Major “chose to wear his metaphorical managing director’s hat…..to deliver a lecture to his subordinates” and was “exercising the very wide remit” Northampton Recruitment gave him “despite the time and place”.

Essentially, the Court found that Major had misused his authority as Managing Director by asserting his views on work related matters to a number of colleagues on the same evening as a work related event which had been arranged and paid for by the employer which meant there was a close enough connection between his position and the assault for his actions to be “in the course of employment”, thus rendering the company liable for his actions.

Whilst this case arose because of the way in which Major chose to exert his authority as the only real decision maker in the company, the ruling will nevertheless make it difficult for employers to know when they might be liable for the acts of their employees.

Businesses should therefore be alert to the notion of vicarious liability; where an office party has taken place, even if it has merely handed over cash to allow staff to go out and have a good time, as employee gatherings such as this could potentially be viewed as an “extension of the workplace” in the eyes of the law, resulting in employers being held responsible for any incidents stemming from them.

But before you decide to cancel the Christmas do altogether this year, remember that social events are important; they boost morale, make employees feel valued and increase loyalty.  Instead, it is better to make sure everyone knows what is expected of them prior to the event by having a policy on workplace social events or addressing the issue in the employer’s disciplinary rules and procedures.  This should explain that whilst employees are encouraged to let their hair down and have fun, their conduct should reflect this and should make staff aware that overly intoxicated behaviour, aggression, hostility or harassment of colleagues will not be tolerated and may result in disciplinary action.

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Russell is a Partner and Head of Glaisyers' Employment Team.

Russell Brown - Partner

To discuss how Glaisyers can assist you contact Russell Brown on [email protected] or via 0161 832 4666.

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