Under the vicarious liability doctrine, an employer can, in some circumstances, be held legally responsible for an employee’s misconduct.

Your employer can be held liable for a car accident you cause while you’re driving for work under the doctrine of vicarious liability, which states that an employer can be held liable for an employee’s actions if:

  • The employee’s actions were conducted within the scope of employment
  • The employee’s actions were performed while working
  • The employee was performing a task he or she was hired to do
  • The employer benefited from the activity being performed by the employee when the accident occurred

In other words, if you caused an accident while driving a company vehicle or while using your own vehicle to carry out a task related to your job, your employer can be held liable for the car accident.

In instances where your employer is found liable for the car accident, their company insurance policy will typically cover damages to any third party injured in the accident. This third party could be the driver or passenger in another vehicle, a passenger in the company vehicle, and pedestrians injured in the car accident.

Damages covered by the employer’s insurance may include:

  • Medical bills
  • Out-of-pocket expenses such as medications, bandages, crutches, and other items required as part of treatment
  • Lost wages
  • Pain and suffering

When is the Employee Liable?

There are certain exceptions to the rule of vicarious liability. You may be considered liable for an accident you caused if:

  • You were running a personal errand at the time of the accident, even if it occurred during work hours or while driving a company vehicle
  • You were committing a crime at the time of the car accident

In addition, employers are generally not considered liable for car accidents caused while you are commuting to work, even if the commute is done in a company vehicle. This is due to the fact that commutes aren’t typically considered within the scope of employment. An exception to this may involve commutes made on a business trip.

If you’re found to be liable for the car accident, your employer’s insurance will most likely not cover damages to any third party injured victims. In these situations, your insurance company will be responsible for paying any damages.

According to SchoemanLaw Inc. it is trite law in South Africa that an employer will be vicariously liable for the negligent act of his or her employee/employees or agent/agents, in the event of the employee/employees or agent/agents acting in a negligent manner during the course of his/her employment.

The question that arises from the above is to what extent will an employer be held liable if his/her employee, at the time of committing the negligent act, attend thereto in his/her personal capacity whilst in the course of business of the employer?

Test for determining vicarious liability

There are three common law requirements to determine the vicarious liability of an employer in standard matters, namely:

  1. An employer-employee relationship must be established;
  2. A wrongful act must have been committed by an employee; and
  3. The employee must have committed the wrongful act whilst acting within the course and scope of his/her employment.

The problem with the above test came when determining vicarious liability in cases which deviated from the norm, as the former created an easy method for the employer to prove that an employee was acting outside the scope of his/her employment. There was accordingly an uncertainty in the law regarding the test for vicarious liability when it cannot be determined by the common law test.

The court created a test to be applied in cases which deviated from standard matters as set out above. This test provided that an employer may still be held liable even if the employee had abandoned his/her business/duties and committed a negligent act on his or her own, provided that there is a ‘sufficiently close connection’ between the actions of the employee and the business of the employer. This test created both a subjective and objective element, the subjective element explores the intentions of the employee when committing the act, and after the establishment of the subjective element, the objective element to the test has to be considered, i.e. to determine whether or not there is a sufficiently close link to the negligent conduct of the employee and the business of the employer.

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The information and content contained herein do not constitute a recommendation or solicitation to purchase or sell any financial product or service or arrive at a financial decision, nor do the contents of this publication constitute any form of advice or guidance.

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