Three recent cases have extended the circumstances in which employers can be held liable for the acts of their employees and others who may be held to be under their supervision, even if only temporarily. In the absence of any contractual apportionment of responsibility for temporary staff or comprehensive insurance cover, employers may be in for a nasty surprise when confronted with a claim for liability.

Until recently employers were held liable for the deeds of an employee only where the person concerned had been acting ‘in the course of employment’. The established test of whether or not this was the case involved considering whether the employee’s wrongful acts were so closely connected with the nature of his or her work that it would be fair and just to hold the employer vicariously liable. Each case turned on its own particular facts.

The first of the three recent cases which have extended the boundaries of vicarious liability was Majrowski -v- Guy’s & St Thomas’ NHS Trust (2005). This considered application of the Protection from Harassment Act 1997 to the employment sphere.

This Act, which makes harassment a criminal and a civil offence, was principally aimed at tackling stalking. However, the claimant’s case was that when he was employed by Guys & St Thomas’ NHS Trust, he suffered bullying, intimidation and harassment at the hands of his departmental manager. He issued proceedings under the Act claiming that the Trust was vicariously liable for the actions of the manager.

The claim was initially struck out by a county court judge on the grounds that Parliament had not intended to import principles of vicarious liability into the Act. The judge believed that a claim under the Act could only be made against the individual accused of harassment. Majrowski appealed to the Court of Appeal.

Recognising that its was dealing with uncharted waters, the Court of Appeal considered various policy and legal reasons and decided that there was no reason why an employer could not be vicariously liable for the actions of employees breached the Act - provided the overriding test of ‘closeness of connection’ between conduct and duties was satisfied.

The Court of Appeal’s decision is problematical for employers for a number of reasons. The Act gives no comprehensive definition of ‘harassment’ and it remains to be seen whether the new definitions in the context of discrimination legislation will be relied upon. Further, given that the discrimination legislation has its own particular vicarious liability tests, it is conceivable that a claim under the Act could succeed where a discrimination claim could fail.

The discrimination legislation also offers employers various possible defences to claims, such as having undertaken reasonably practicable steps to prevent the act of discrimination from taking place. No such defence is available in the Protection from Harassment Act.

This is unlikely to have been the intention of Parliament when the Act was passed. The House of Lords will be hearing this case in May and some definitive guidance is awaited.

In Viasystems (Tyneside) Limited -v- Thermal Transfer (Northern) Limited, (2005), the Court of Appeal had to consider whether more than one employer could be vicariously liable for an act of negligence.

In this case, Viasystems hired Thermal Transfer to install air conditioning in its factory. Thermal Transfer sub-contracted the work to another company, which in turn arranged for a third company to provide fitters and fitters’ mates on a labour only basis. One of the fitters worked under the supervision of the second contractor and negligently caused a flood which damaged the factory.

A 1947 House of Lords decision held that in certain limited circumstances the ‘hirer’ of an individual’s services rather than his usual employer could be vicariously liable for that person’s actions. The test was whether the hirer was in control of and responsible for the work being done.

In the Viasystems  case the Court of Appeal concluded there was no reason why more than one company could not be held vicariously liable. The Court suggested that the core question should be ‘who is entitled and, in theory, obliged, to give orders as to how the work should or should not be done?’ In particular, who is responsible for preventing the negligent act? In some circumstances, this will be two employers and there was no legal reason why both of them should not be vicariously liable.

The Court gave the example of where dual vicarious liability might occur as circumstances in which an employee of a business is hired out on a temporary assignment in which he or she uses the temporary employer’s equipment, and is made subject to its direction. It would not be appropriate, according to the Court, where an employee is hired out to a temporary employer, but continued to use the general employer’s equipment and exercises his or her own discretion regarding the work that is performed.

The Court considered that in the case before it both the primary employer and the employer of the supervisor were entitled to prevent the fitter’s negligence and that, therefore, both employers should be vicariously liable, each for 50 per cent each of the total liability.

Clearly, the question of whether employers are jointly vicariously liable depends on each particular case. It was perhaps unusual in this case that there were individuals on site from more than one company, all of whom had a degree of control over the fitter.

The third case (Hawley -v- Luminar Leisure plc, 2006), dealt with the question of who was liable for the actions of a nightclub door supervisor. Luminar owned the Chicago Rock Café in Southend and engaged another company to provide security staff. One of the door supervisors supplied by that company became involved in a fracas with the claimant when he left the nightclub. As a result Hawley sustained serious injuries. He commenced proceedings in the High Court against both the security company and Luminar. However, by the time of the hearing, the security company had been wound up.

The High Court decided that Luminar had sought and exercised detailed control over not only what the door supervisors were to do, but the way in which they were to do it. Accordingly, it decided that the door supervisor was a ‘temporary deemed employee’ of Luminar and that it, rather than the security company which employed him, was vicariously liable for the door supervisor’s actions,

The Court of Appeal agreed. It found that for all practical purposes, the management of Luminar controlled the provision of the doorman’s services. Its manager was in charge of security and the doormen took their orders from that manager.

The Court considered the Viasystems decision and whether both Luminar and the security company should be jointly liable but concluded that the security company had no immediate or effective control over the doorman’s activities. Its only role had been to employ him, provide him as a doorman, and pay his wages. All control and responsibility had transferred to Luminar and, as such, it was that company which should be solely liable for the doorman’s actions. It did not matter that Luminar did not concern itself with the technicalities of, or the doormen’s training in, methods of restraint.

Although the Court of Appeal’s decision may have been driven by the policy consideration that the security company was no longer in business, the decision does, once more, raise the possibility that an employer will be vicariously liable for the actions of someone whom it may not have considered as its employee.

As a result of the above decisions, employers need to consider carefully the circumstances in which they may be liable for the actions of those individuals for whom they are responsible and whom they control, even if they are technically employed by a third party. Users of agency staff are especially likely to be affected by these decisions and ought to consider now the question of how liability is apportioned in the contractual documentation which they have with such third party companies.

Ideally, contracts between two ‘employers’ should identify responsibility for a borrowed individual’s negligence. Alternatively, insurance policies should be checked to ensure that they cover this category of employee.


Paul Callegari leads the Employment Group in the London office of Kirkpatrick & Lockhart Nicholson Graham LLP