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What’s Vicarious Liability?

What’s Vicarious Liability?

Understanding the concept of vicarious liability is important for any employer - read about it here.

24th January 2019
Reading Time: 2 minutes

Generally, employers are legally responsible for the actions of their employees. It is subsequently an employer’s duty to ensure that they provide adequate training and support to employees to minimise risk.

If an employee commits a wrongful act in the workplace, the employer will be responsible. A term known in Tort Law as ‘vicarious liability’ refers to a situation where an individual is liable for the tortious act of another. In Tort Law, a ‘tort’ refers to a wrongful act not considered a crime. Torts are civil actions which most commonly result in damages being awarded to the wronged party.

Employers held liable for employees

Vicarious liability applies to a person held liable for the wrongful act or omission of another. The person held liable does not need to know that the other person had committed the act. This is commonly found when an employer is held liable for the wrongful act of her/his employees. Although the employer may have not known that the employee committed a wrongful act, he/she will be held vicariously liable for the damage it has caused.

However, liability can often extend towards both employee and employer. An employee will still be responsible for their actions as a ‘tortfeasor’.

Discrimination or harassment in the workplace

Vicarious liability also applies to discrimination or harassment in the workplace. Employers are responsible for discrimination and harassment that occurs in the workplace. This includes in any work-related situation such as training session, work-related social functions, and business or field trips. Having the appropriate workplace policies (such as a performance management policy) will ensure that your employee not only understands what is expected of them on the job, but also what actions will be taken if they are breached.

Employees who harass, bully or discriminate other employees will be personally liable for the damage they may cause to victims. However, employers will be equally liable if they do not take ‘reasonable steps‘ to mitigate the issue. There is no clear definition of ‘reasonable steps’ in anti-discrimination laws. However, it generally refers to making arrangements that will mitigate cases of harassment or discrimination in the workplace.

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Employers will need to be careful about the responsibility they have for employees’ conduct. One such way of ensuring employees do not commit wrongdoing is to implement a workplace policy. Additionally, conducting staff training to increase awareness of workplace practices and having a proper system for staff complaints is essential for mitigating vicarious liability.

Employers interested in creating a workplace police should consider speaking to an Employment Lawyer. Implementing a workplace policy ensures that the risk of vicarious liability is minimised.

Have more questions? Contact a LawPath consultant on 1800 529 728 to learn more about customising legal documents and obtaining a fixed-fee quote from Australia’s largest legal marketplace.

Christopher Cruz

Chris is a legal intern at Lawpath, and is currently studying a Bachelor of Laws at Macquarie University. He is interested in commercial and IT law.