Learning Outcomes
This article outlines the principles of vicarious liability, specifically focusing on when an employer or an entity in a similar position might be held legally responsible for torts committed by an employee or someone in a relationship akin to employment. For the SQE1 assessments, you will need to understand the key requirements for establishing vicarious liability, including the nature of the relationship required and the connection between the tort and that relationship. Your understanding will enable you to identify and apply the relevant legal rules to SQE1-style single best answer questions.
SQE1 Syllabus
For SQE1, you are required to understand the principles governing vicarious liability, particularly in employment contexts and similar relationships. It is likely that you will be required to determine whether vicarious liability arises in a given scenario, applying the relevant tests and legal principles.
As you work through this article, remember to pay particular attention in your revision to:
- the core elements required to establish vicarious liability: a tort, a relevant relationship, and the tort occurring in the course of that relationship or being closely connected to it.
- the tests used to determine whether a worker is an employee or an independent contractor (control test, embeddedness test, economic reality test).
- the concept of relationships 'akin to employment' and the factors indicating such a relationship.
- the meaning of 'in the course of employment', including the 'close connection' test for intentional torts.
- distinguishing acts within the course of employment from an employee being on a 'frolic of their own'.
Test Your Knowledge
Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.
- Which three elements must typically be established for an employer to be held vicariously liable for the actions of a worker?
- What is the key difference between an employee and an independent contractor regarding vicarious liability?
- Name one test used by courts to determine employment status.
- True or false? An employer can never be vicariously liable for an employee's criminal act.
Introduction
Vicarious liability is a form of secondary liability where one party (D2) can be held liable for a tort committed by another party (D1), even though D2 was not personally at fault. This liability arises because of the relationship between D1 and D2. The most common example encountered in legal practice is the liability of an employer for torts committed by their employees. Understanding when this liability arises is essential for advising clients involved in disputes where an employee's actions have caused harm.
Key Term: vicarious liability The legal principle where one party can be held liable for the torts committed by another, due to a specific relationship between them (e.g., employer-employee).
For vicarious liability to be established against an employer, three core requirements must be met:
- A tort must have been committed by the employee.
- The tortfeasor must be an employee of the defendant employer (or be in a relationship akin to employment).
- The tort must have been committed in the course of employment (or have a sufficiently close connection to the relationship).
The Requisite Relationship: Employee or Akin to Employment?
An employer is generally liable only for the torts of their employees, not those of independent contractors. Therefore, determining the nature of the relationship between the tortfeasor and the defendant is a critical first step.
Distinguishing Employees from Independent Contractors
Historically, courts used various tests to determine employment status. While no single test is conclusive, the following are important factors:
Key Term: control test An early test focusing on whether the employer had the right to control not just what work was done, but how it was done. Less decisive now, but still relevant.
Key Term: embeddedness test Considers whether the worker's role is central to the business (suggesting employment) or merely accessory to it (suggesting an independent contractor).
Key Term: economic reality test A modern approach looking at the overall financial and practical relationship, considering factors like payment method (salary vs fee), provision of equipment, tax/NI handling, degree of financial risk, and opportunity for profit.
The modern approach, often encompassing elements of the earlier tests, looks at the substance of the relationship rather than just the label the parties give it. The economic reality test, considering multiple factors, is particularly influential.
Relationships 'Akin to Employment'
The scope of vicarious liability has extended beyond the traditional employer-employee contract. Courts may impose liability where the relationship, while not formal employment, has similar characteristics making it fair, just, and reasonable to do so.
The Supreme Court in Various Claimants v Catholic Child Welfare Society [2012] UKSC 56 (the Christian Brothers case) identified five policy reasons often supporting vicarious liability which can also indicate when a relationship is 'akin to employment':
- The 'employer' is more likely to have the means to compensate the victim.
- The tort was committed as a result of activity undertaken by the tortfeasor on the 'employer's' behalf.
- The tortfeasor's activity is likely part of the 'employer's' business activity.
- The 'employer' created the risk of the tort by assigning the activity to the tortfeasor.
- The tortfeasor was, to some degree, under the control of the 'employer'.
Cases like Cox v Ministry of Justice [2016] UKSC 10 (prisoner injuring prison employee while working) demonstrate this extension. The key is whether the tortfeasor's activities are incorporated into the defendant's enterprise and carried out for their benefit, thereby creating the risk that led to the tort.
Course of Employment or Close Connection
Once a relevant relationship is established, the tort must have been committed in the course of that employment or relationship.
Authorised Acts and Unauthorised Modes
Traditionally, the 'Salmond test' considered acts to be in the course of employment if they were either:
- expressly or impliedly authorised by the employer; or
- an unauthorised way of doing an authorised act.
Worked Example 1.1
A delivery driver, employed by Courier Ltd, is told not to exceed 60 mph. While making deliveries, he drives at 70 mph and negligently causes an accident. Is Courier Ltd likely to be vicariously liable?
Answer: Yes. Driving the delivery van is an authorised act. Exceeding the speed limit is an unauthorised mode of performing that authorised act. The tort occurred in the course of employment.
This contrasts with situations where the employee does something entirely outside their duties.
'Frolic of One's Own'
If an employee's act is entirely for their own benefit and unrelated to their employment duties, they are said to be on a 'frolic of their own', and the employer is generally not liable.
Worked Example 1.2
Same delivery driver as above. After his last delivery, instead of returning to the depot, he drives 50 miles in the opposite direction to visit a friend. On this detour, he negligently causes an accident. Is Courier Ltd vicariously liable?
Answer: Unlikely. This appears to be a significant deviation from his employment duties for a purely personal purpose. He is likely on a 'frolic of their own', taking him outside the course of employment.
Whether a deviation constitutes a 'frolic' is a matter of degree, considering factors like the extent and purpose of the deviation.
Intentional Torts and the 'Close Connection' Test
Employers can also be liable for intentional torts (like assault, battery, or fraud) committed by employees, even if the act was unauthorised or criminal. The key test, established in Lister v Hesley Hall Ltd [2001] 1 AC 215, is whether the tort was so closely connected with the employment that it is fair and just to hold the employer liable.
This involves considering the functions entrusted to the employee and whether the employment created or significantly enhanced the risk of the tort occurring.
Worked Example 1.3
A supermarket employs B as a petrol station attendant. A customer, C, becomes abusive at the kiosk. B follows C out to his car and assaults him. Is the supermarket vicariously liable?
Answer: Possibly yes. Following Mohamud v WM Morrison Supermarkets plc [2016] UKSC 11, B's job involved customer interaction. Although the assault was wrong, it arose from a confrontation that started within his field of activities. A court might find a sufficiently close connection between his employment and the assault.
Exam Warning
Do not confuse the employer's primary liability in negligence (e.g., for failing to provide competent staff or a safe system of work – see Employers' Liability) with vicarious liability. Vicarious liability arises even if the employer was not personally negligent, based purely on the employee's tort and the relationship.
Key Point Checklist
This article has covered the following key knowledge points:
- Vicarious liability makes one party (e.g., an employer) liable for the tort of another (e.g., an employee) due to their relationship.
- Three elements are needed: (1) a tort committed, (2) an employee or akin-to-employee relationship, (3) tort committed in the course of employment or closely connected to it.
- Distinguishing employees from independent contractors involves considering control, embeddedness, and economic reality.
- Liability can extend to relationships 'akin to employment' based on factors like incorporation and risk creation.
- 'Course of employment' includes authorised acts and unauthorised modes of doing authorised acts, but not 'frolics of one's own'.
- The 'close connection' test applies to intentional torts, assessing the link between the employment duties and the wrongful act.
Key Terms and Concepts
- vicarious liability
- control test
- embeddedness test
- economic reality test
