THE Christmas season is upon us, workplace parties are in full swing, and while the emphasis should be on having fun, employers are wise to be alert to the possible vicarious liability risks associated with their employees’ actions.
Where an employer endorses and supports a workplace function, financially or otherwise, the general position is that this function is an extension of the workplace and the normal working environment. Usual workplace behaviour is therefore required and the employer can be held vicariously liable for the actions of any employees during the function.
The extent of the employer’s liability has however been somewhat unclear, especially in relation to the ‘after-parties’ that often follow such functions.
The Bellman v Northampton Recruitment Ltd decision issued in December 2016 was believed to have provided some clarity on this matter when the High Court ruled that the company was not liable for one employee’s violent assault on another employee at the after-party to the work function.
The claimant was a sales manager at a small recruitment agency for HGV drivers. In December 2011 the company held its Christmas party at a local golf club. Most of the employees and their partners and a few guests attended. Following the party, the managing director initiated a move to a nearby hotel, where the guests could continue to drink and talk.
Approximately half of the guests attended this after-party. The conversation was initially about social topics but moved to work around 2am. A controversial issue arose and the managing director lost his temper. He lectured the employees present on how he owned the company and made the decisions.
When the claimant challenged him, the managing director punched the claimant twice, knocking him to the floor, fracturing his skull and rendering him unconscious. Medical reports confirmed that the claimant suffered severe brain damage and would be unlikely to work again.
The High Court found the company not liable as the assault was committed after, not during, the work function and a line could therefore be drawn between the party at the golf club and the after-party at the hotel. What occurred was held by the High Court to be “a personal choice to have yet further alcohol long after a work event had ended”, and the fact that before the assault the conversation had turned to work could not provide a sufficient connection to support a finding of vicarious liability.
The provision of alcohol by an employer at a Christmas party is customary and can be safely enjoyed in moderation. There was therefore not a sufficient connection to make the company liable.
But the matter was appealed, and in October the Court of Appeal overturned the decision of the High Court.
At appeal, looking at the managing director’s role and the connection between his role and the incident, it was found that there was a sufficient connection between the managing director’s field of activities within the company and the assault to render it proper that the company should be vicariously liable.
Lord Justice Irwin noted that this matter “arose because of the way in which the MD chose to exert his authority, indeed his dominance as the only real decision-maker, in the company.”
He went on to comment that liability “will not arise merely because there is an argument about work matters between colleagues, which leads to an assault, even when one colleague is markedly more senior than another.”
Establishing whether or not an employer will be held vicariously liable for such incidents remains unclear. Currently there is no straightforward process for determining liability - it requires a case by case assessment of the close-connection of the circumstances. It would appear that vicariously liability remains a risk for employers.
:: Seamus McGranaghan is director (commercial) at O'Reilly Stewart Solicitors (seamus.mcgranaghan@oreillystewart.com or 02890321000).
