Supreme Court widens scope of liability for the actions of employees
On 2 March 2016 the Supreme Court changed the face of employer’s liability law by widening the net that forces employers to pay compensation to victims of wrongful acts carried out by their employees.
In an appeal to the Supreme Court, the family of Mr Muhamud, who sadly died before the Appeal was heard, argued that Morrisons Supermarkets Ltd should pay compensation to Mr Muhamud for injuries sustained when one of its employees attacked him at one of its stores.
Mr Muhamud arrived at the petrol station at Morrisons’ store in Small Heath, Birmingham. He asked the employee behind the counter, Mr Amjid Khan, if he would print out some documents that he had on a USB memory stick. Mr Khan was abusive in reply, so Mr Muhamad returned to his vehicle parked on the forecourt.
Mr Khan followed him out to the car, shouted further abuse at him and punched him twice in the head. He then continued to kick and punch Mr Muhamud as he lay curled up on the floor.
Mr Muhamad has subsequently passed away, for reasons unrelated to the attack, but his estate continued his claim for compensation against Morrisons for the injury and distress caused by Mr Khan.
The old law
Prior to the Supreme Court’s judgment this week, employers could be held liable for the actions of their employees (‘vicariously liable’) if the act in question was undertaken in the course of the employment and there was a sufficient connection between the wrongful act and the duties expected of the employee in the course of his or her employment.
Whilst the legal test has remained the same for decades, its interpretation has been varied, creating uncertainty as to the likely outcome of cases.
For example, it was easier to find a nightclub responsible for acts of unreasonable violence against a customer by a member of its security staff, as physical contact between them and the customer can be expected. It was harder to prove the vicarious liability in a case where a car salesman injured a customer through force, as there is no expectation that their could be contact between them
In Mr Muhamud’s initial claim in 2014, the Court found that Morrisons should not be held liable for the injuries caused by Mr Khan, as it would not be expected that a shop assistant would be required to come into physical contact with a customer in this way. This view was upheld by the Court of Appeal and Mr Muhamud and his family appealed again.
The new law
Giving the leading judgment in Mr Muhamud’s case, Lord Toulson reviewed the development of vicarious liability over the years. His amended approach to the legal test will mean that more employers could be held liable for acts of their employees, when previously they would have escaped liability to compensate the injured party..
Lord Toulson found that the test for vicarious liability should now be determined by answering the following two questions:
1) What function or “field of activities” have been entrusted to the employee?
2) Is there a sufficient connection between that function of employment and the wrongful act?
When considering the first question in Mr Muhamud’s case, Lord Toulson found that Mr Khan’s job as the shop assistant was to respond to customer queries and therefore the event (the attack on Mr Muhamud) was related to his field of activities.
As to the second question, he found that there was a seamless course of events between Mr Khan’s initial response and his attack of Mr Muhamud on the forecourt. He said that Mr Khan ‘did not metaphorically take off his uniform’ when he went out onto the forecourt and was acting on behalf of Morrisons when he told Mr Muhamud that he was not welcome back to the store. It was not a personal matter between the two, but an issue between Morrisons and one of its customers. Lord Toulson found that Mr Khan was abusing his position within the organisation, but he was acting in the course of the business.
Lord Toulson added that the motive for the wrongful act, in this case thought to be racial, was irrelevant, where both elements to the test had been proved.
What does this mean?
The ruling will widen the scope for those injured by employees to bring a claim for compensation against their employer. Injured parties can still, of course, bring a claim against the employee personally, but often they will have not have the means to satisfy any award of compensation made.
Bringing a claim against the employer rather than the individual concerned increases the chance of being able to recover the compensation, as the employer is more likely to be insured or have other means to pay the compensation.
The ruling will come as a disappointment to employers and their insurers, who now face potential liability for all sorts of wrongful acts of their employees in situations where they were once protected. No matter how outrageous their employees’ behaviour may be, they will be responsible for any claims if the wrongdoing was carried out within the employees’ “field of activities” entrusted to them.
If you wish to discuss a personal injury claim, please contact a member of our specialist team on 0800 316 8892 for advice.