The Supreme Court has for the first time since 2012 considered the law of vicarious liability in the workplace. In Cox v Ministry of Justice [2016] UKSC 10 and Mohamud v WM Morrison Supermarkets plc [2016] UKSC 11, the Supreme Court has effectively expanded the doctrine of vicarious liability to include a wider range of factual circumstances, including beyond employee-employer relationships.

Background

Where vicarious liability is established an employer will be liable for the acts of its employees. The consequences for business are significant, particularly for organisations with large numbers of employees. Both the likelihood of legal action and the cost of employer liability insurance are inherently linked to this legal principle.

Cox v Ministry of Justice (MOJ)

Mrs Cox was employed by HM Prison Swansea, supervising both civilian staff and prisoners working in the prison kitchen. She was accidentally injured by the negligence of a prisoner, who dropped a sack of rice on her back. She brought a claim against the MOJ. The County Court found that the MOJ was not vicariously liable for the negligence of the prisoner. The decision was reversed by the Court of Appeal, who found the relationship between the prisoner and the prison service was akin to that of employer and employee. 

The Supreme Court dismissed the subsequent appeal, again holding the MOJ liable. The Court stated vicarious liability can be established in employment like relationships and not only employer/employee. The Court will give significant weight to two factual elements: (1) harm is wrongfully done by a person who carries on activities as an integral part of the business activities of the defendant and for its benefit; and (2) the risk of the wrongful act occurring was caused by the defendant in assigning responsibility to the wrongdoer.

This decision might be seen as an attempt to recognise the reality of the modern workplace and reflecting the fact that workers often do not have a contract of employment with an organisation for which they work.

Mohamud v WM Morrison Supermarkets plc (Morrisons)

Mr Mohamud visited a petrol station owned by Morrisons, where he was racially abused, assaulted and told to leave the premises by Mr Khan, an employee of Morrisons. Mr Mohamud sued Morrisons for the actions of its employee. Both the trial judge and the Court of Appeal dismissed the claim, finding that there was an insufficiently close connection between the wrongdoing of Mr Khan and the duties of his employment.

Mr Mohamud appealed to the Supreme Court, which allowed the appeal. The close connection test, which formed the basis of the decision in the lower courts was approved. However, the key elements to this test were reformulated. In ‘simplest terms’, the test is formed of two questions: (1) what is the nature of the job entrusted to the employer, considered in the broadest terms; and (2) is there sufficient connection between the position in which the employee is employed, and the employee’s wrongful conduct to make it right for the employer to be held liable under the principle of social justice. Mr Khan’s job was to attend to customers. His response to Mr Mohamud as a potential customer was within the ‘field of activities’ entrusted to him by his employer. An unbroken sequence of events followed in which Mr Mohamud was told never to return to the premises. Whilst an abuse of position, Mr Khan was purporting to act about his employer’s business. Morrisons was therefore held responsible for the abuse of the position it entrusted to Mr Khan.

What this means for business

The expanded reach of vicarious liability of employers will clearly be of concern to organisations with a large workforce. An employer can avoid vicarious liability for discrimination committed by employees (and detriment on account of whistleblowing) if it can show it took all reasonable steps to prevent the alleged perpetrator from doing the alleged act of discrimination or anything of that description. A range of measures should be considered including training and the implementation of suitable policies. 

Please click here for further case details on Cox. 

Please click here for further case details on Mohamud.