We may not quite be into Christmas party season just yet, but the Court of Appeal has given employers something to think about in advance of this year’s festivities.
In the case of Bellman v Northampton Recruitment Ltd the court held that a company was vicariously liable for an assault by its Managing Director on an employee following a company Christmas party. In doing so it overturned the previous decision of the High Court on the matter which had given employers some comfort when it came to the extent of vicarious liability in this context [‘Could you end up paying for more than just the bar tab at your office Christmas party?’ ].
The company held its annual Christmas party to which all employees plus their partners were invited. Following the party half of the guests went on to a hotel where some of the employees were staying. This was not a planned extension of the party but ‘impromptu drinks’. The Managing Director paid for taxies for the employees and most of the drinks were paid for by the company. In the early hours, the chat turned from social topics to work matters and a controversial issue arose regarding a new employee’s placement and terms. The MD "summoned" the remaining employees and began to lecture them on how he owned the company, that he was in charge and that he would do what he wanted to do. An employee challenged the MD, in a non-aggressive manner, and the MD punched him twice, the second blow knocking him out, causing him to fall and sustain brain damage. The employee brought a claim for damages against the company on the basis that it was vicariously liable for the MD’s conduct.
The key factors for the Court of Appeal in determining that the employer was vicariously liable for the actions of its MD were:
- The fact that even if the MD had “taken off his managerial hat” when he got to the hotel for the impromptu post party drinks, he chose to “don it once more” and had re-engaged his wide remit as MD and misused that position when his managerial decisions were challenged. This was demonstrated by the fact that he had “summoned” the remaining employees and began to lecture them about his authority.
- There was no suggestion that the MD’s behaviour arose as a result of something personal, it was in relation to a challenge regarding work.
- Despite the time and place at which the assault occurred (i.e. after 2am in a hotel lobby) the MD’s position of seniority persisted and was a significant factor. He was in a dominant position and had a supervisory role which enabled him to assert his authority over the staff who were present.
On the basis of these factors the Court of Appeal considered there was a sufficient connection between the MD’s actions and his role to render the employer vicariously liable for his actions.
This decision builds upon the expansion of the doctrine of vicarious liability, following other recent decisions in Mohamud v W M Morrison Supermarkets plc (which involved an employee assaulting a customer in a petrol station forecourt) and Various claimants v W M Morrison Supermarket Plc (which involved a serious data protection breach by a rogue employee). It is clear that the test to determine whether the actions of the employee had a close connection to their employment is broad in its application.
In terms of limiting the employer’s exposure, there was little in reality that could have been done in this case on the basis that the assault was perpetrated by the MD himself and a number of the key reasons the employer was found to be vicariously liable were based on his seniority and his misuse of that position. One of the Court of Appeal judges commented that the facts of this case were unusual and this case is not authority for the proposition that employers become insurers for violent acts by their employees.
As vicarious liability cases do depend heavily on their facts it would not harm employers in the run up to party season to remind staff of the acceptable standards of behaviour in relation to work events, the wide interpretation given to actions “in the course of employment”, and the potential ramifications in terms of disciplinary action, and potentially dismissal, if the festivities turn sour.
If you’d like any further advice, please don’t hesitate to contact a member of Geldards’ Employment Law Team.
RELATED: EMPLOYMENT LAW - EXPERTISE