In a shock decision last week, the High Court determined that an employer could be held vicariously liable for criminal acts committed by an independent contractor.

In Various Claimants -v- Barclays Bank plc (Dr Bates (deceased) and Barclays Group Litigation) [2017] EWHC 1929 (QB), the court were asked to determine by way of preliminary issue whether Barclays Bank should be held vicariously liable for alleged sexual assaults committed by an independently-contracted doctor during the course of pre-employment medical examinations between 1968 and 1984. The claimants, many of whom were 16-year-old females at the time of the alleged assaults, had applied for jobs at the bank and, as a condition of their employment, had to pass a pre-employment medical examination. Dr Bates was independently contracted by Barclays to carry out these pre-employment medical examinations at his home and Barclays had similar arrangements with local doctors across the country. Dr Bates also contracted his services out to other businesses as well as to local hospitals.

In applying the established two-stage for vicarious liability, the High Court were first asked to determine whether the relationship between the bank and Dr Bates was such that it was capable of giving rise to vicarious liability. Applying the criteria refined by the Supreme Court in Cox -v- Ministry of Justice [2016] UKSC10, the court held that the medical examinations were purely for the benefit of the bank and were a part of the bank’s business activities. The purpose of the medical examinations was to ensure that the bank had a healthy workforce, which was integral to its business activity. The bank had further created a risk of sexual assault by engaging Dr Bates to carry out examinations on their behalf. The court also considered that, as Dr Bates had died in 2009 and his professional indemnity insurance was unlikely to have covered intentional sexual assaults, the bank was more likely to have the means to compensate the claimants. With regards to the level of control which the bank had over Dr Bates, the court found that the bank had provided detailed instructions to Dr Bates regarding the nature of the physical examination to be conducted, which included an unusually detailed, Barclays-logo proforma for Dr Bates to complete.

The court were then asked to determine whether there was a sufficiently close connection between the assaults and the relationship between Dr Bates and Barclays, which was established because the assaults were committed during the course of medical examinations which Dr Bates had been instructed to carry out. Finally the court considered that it was just, fair and reasonable to impose vicarious liability upon the bank because it was the claimants’ sole legal recourse.

The case represents an extremely worrying extension to the applicability of vicarious liability to independent contractors based on public policy reasoning. One of the key considerations for the court was the fact that the bank had the resources to pay the claimants’ claims and therefore it was just that they should be held liable. Shipping companies who independently contract doctors to work onboard their vessels or to carry out pre-employment medical checks for crew members now risk being found liable for any wrongdoing committed by those doctors during the course of such examinations. In addition, any employer who independently contracts occupational health doctors to carry out examinations of their employees risks being held vicariously liable for any wrongdoing. The implications for other independent contractors will depend on the application of the two-stage test but the risks of now being found liable for their acts seems to have considerably increased. The decision represents another significant expansion of the scope of the law on vicarious liability in the claimant’s favour. Care should be taken in relation to the documents produced and representations made for such medicals so as to try and avoid, if possible, such liabilities.