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Employee Car Accidents: Is the Employer Liable?

  • May 17, 2006

If your employee is in an automobile accident, can you be held liable? The answer, of course, is "it depends."

Respondeat Superior Liability Generally

The general rule in California is that employers are liable for employees' mistakes under the theory of "respondeat superior," which means "the superior must answer." This principle helps spread risk among those who are best able to bear it. Because the employer does not actually commit the wrong, the allocation of responsibility to the employer is also known as "vicarious liability."

Employer vicarious liability generally is limited to employee errors which occur within the "scope of employment." For example, if a waiter accidentally spills soup on a customer during a busy lunch shift, the restaurant may be responsible for the customer's injuries caused by the employee's mistake.

Similarly, if a construction worker does not install pipes correctly, the plumbing contractor may be responsible for the damages caused by the sloppy work. The test is whether the risk of injury is incidental to (a normal part of) the business in which the employer is engaged. This standard is broad and encompasses a range of negligent conduct by employees at work.

Application of the Scope of Employment to Intentional Conduct

The "scope of employment" is a flexible and expansive concept. Ordinarily, it results in broad vicarious liability for employers and correspondingly broad protections for employees under workers' compensation and other laws. The California Supreme Court and lower courts have held that employers are not automatically liable for all conduct occurring at work.

For example, when employees engage in intentional conduct purely for their own purposes, even during work hours and at the work site, the courts will not shift liability for third party injuries to the employer. In a series of cases, appellate courts have found that employees' sexual and physical assaults occurring during working hours were not attributable to the employer.

Special Liability Rules Applicable to Motor Vehicle Use

When an employee is involved in a car accident, the general "scope of employment" rule is modified, even if the employee is not working at the time of the accident. For example, in Taylor v. Roseville Toyota, Inc., the California Court of Appeal decided that an auto dealership should be required to pay for injuries caused by an employee who took one of the dealership's cars for a personal errand, and then rear-ended a couple in another car.

Liability in that case was not based on traditional "respondeat superior," but rather on Vehicle Code section 17150. That section imposes liability on the owner of a vehicle when the owner gives express or implied permission to use it. The auto dealership had detailed procedures to account for vehicles checked out by employees for business errands. However, the court determined the dealership did not take sufficient steps to ensure employees were not using company cars for personal reasons.

Under the "going and coming" rule, employers generally are not responsible for employees' car accidents that occur during non-working hours, such as during commuting time. But exceptions that can result in employer liability may apply.

For instance, employers can be held liable when travel is "incidental" to job duties, such as when the employee is traveling to or from a company event, such as a picnic. If the employer requires employees to use personal vehicles for work, pays the employee for commute time, or the employee travels as part of his or her duties using a personal vehicle, the employer may be held liable for accidents occurring in the vehicle.

A narrow "special risks" exception also may result in liability. This exception was applied in a case where an employee was involved in an automobile accident while driving home after suffering a work-related injury. Because the evidence revealed the employer had concerns about the employee's ability to safely drive, the employer was held liable for the employee's accident.

Of course, there are countless possibilities for accidents in the workplace resulting in injury to third parties and potential liability for employers. A mistake driving a car, however, can cause much more damage than a bowl of soup. To avoid vicarious liability for employees' accidents in company vehicles, employers should review policies and internal controls on vehicle use. In the Taylor case, the court found insufficient evidence of the means to ensure employees did not use vehicles for personal errands, and company policy was vague on the subject.

Employers who wish to avoid potential liability for accidents occurring during employees' commuting time should ensure company insurance policies cover exceptions to the "going and coming" rule. Additionally, employers should work with employees to ensure they operate vehicles safely, which could include, for example:

  • policies regulating cell phone use or other distractions while employees are driving during work time;
  • policies and training regarding safe operation of vehicles;
  • programs to ensure employees are properly licensed;
  • adequate insurance coverage for accidents when they occur; and
  • checking driving records for employees who operate motor vehicles as part of their regular work duties.

Note: This article appears in the May 17, 2006 edition of the Daily Recorder.

©2006 Jackson Lewis P.C. This material is provided for informational purposes only. It is not intended to constitute legal advice nor does it create a client-lawyer relationship between Jackson Lewis and any recipient. Recipients should consult with counsel before taking any actions based on the information contained within this material. This material may be considered attorney advertising in some jurisdictions. Prior results do not guarantee a similar outcome.

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