What Is Vicarious Liability?

What Is Vicarious Liability?

Let me explain vicarious liability to you directly: it's when one party gets held responsible for what another party does. Generally, this means an employer is on the hook for an employee's actions if that employee is doing their job within the scope of their employment. Parents can also face this for their kids' actions in some cases.

Key Takeaways

You should know that vicarious liability happens when a supervisory party is liable for the negligent actions of someone they're responsible for. As an employer, you can avoid it by taking reasonable steps to prevent your employees' negligent behavior. And remember, parents might be held accountable for their children's negligent or even criminal actions under certain conditions.

How Vicarious Liability Works

Vicarious liability, or imputed liability, is basically indirect responsibility for someone else's actions, like a subordinate or a child. If you're an employer, you could be liable for an employee's negligent or unlawful behavior. This extends to situations where an employee mishandles equipment or machinery, causing property damage or personal injury.

Take this example: if a construction worker botches the controls on a crane and knocks down a nearby building's wall, the construction company could be vicariously liable for the damages. Similarly, if an engineer loses control of a train and it runs wild, the train company might have to pay for any resulting harm.

For liability to stick, two things need proving: the employee acted within their job scope, and there's evidence you as the employer didn't reasonably try to prevent or limit harmful acts by your employees.

Fast Fact

Here's a quick note: you as an employer can dodge vicarious liability by making sure employees use reasonable care to avoid unlawful behavior, through training, supervision, and setting up controls.

Example of Vicarious Liability

Consider the 1989 Exxon Valdez oil spill, where Exxon Shipping Co. was held liable for the tanker captain and crew's actions. Negligent events on board caused about 10.8 million gallons of crude oil to spill into the sea off Alaska, damaging the shore and wildlife.

The company got pinned for poor supervision of the captain, crew fatigue, and faulty radar equipment that could have prevented the grounding. This case is complex due to appeals, changing awards, and maritime law ambiguities about ship owners' responsibility for employees.

How to Avoid Vicarious Liability

To steer clear of this, actively monitor your workplace, handle complaints from employees, vendors, or suppliers, and set up a clear way to report issues. Document everything in detail.

Create employee manuals that thoroughly explain rules and expected conduct. Make sure new hires read, understand, and accept them, and have existing employees review them periodically.

Offer training programs that cover safety protocols and proper job conduct. Bring in a lawyer to review your business and discuss vicarious liability risks and protections.

If there's a risk, look into business insurance like general liability, which covers third-party property damage or injuries caused by you or your employees. Errors and omissions insurance can protect against mistakes or service failures. Buy and maintain the right coverage.

Special Considerations

Another area where vicarious liability pops up is with children acting negligently. Parents can sometimes be held responsible. For instance, if an older child takes the parents' car without permission or a license and causes injury or death, the parents might be liable for allowing access to the vehicle.

What Are the Two Principles of Vicarious Liability?

To impose vicarious liability, two principles apply: there must be a duty to control the negligent person's activities, making one party answerable for another, and the action must be within the scope of their relationship.

What Is Liability vs. Vicarious Liability?

Regular liability is when you're accountable for your own actions. Vicarious liability is when you're accountable for someone else's.

What Is a Vicarious Liability Example?

You could face vicarious liability in various scenarios. If you loan your car and the borrower causes an accident, you might be liable depending on the details. There are also cases where police departments were held liable for crimes involving duty weapons left unsecured off-duty.

The Bottom Line

Vicarious liability can arise in situations where one person is legally responsible for another's actions, like an employer for an employee's misconduct. If you're in a spot where this might apply to you, consult an attorney for guidance.