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Employers Should Answer For An Employee's Criminal Conduct. Right?

This doesn't always work out as you might expect.

08/08/2017 15:43 EDT | Updated 08/08/2017 16:29 EDT

If you have been injured, and the person at fault is an employee who was at work for a company, you will almost always want to sue the employer for damages. The principle that employers are liable is an important part of our legal system to compensate victims. Employers usually have deeper pockets, while the typical employee may not have enough money to make it worth suing.

It is referred to as "vicarious liability" because the employer doesn't have to be at fault for it to apply. The mere fact that its employee was at fault is generally enough to make the employer financially liable for the damage. The employer did not have to do anything specifically wrong, and will often be liable even if the employee who was at fault was in violation of company policies.

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This doesn't always work out as you might expect. In a recent case of alleged harm by an employee on the job, the employer escaped liability. A woman became unwell at a party, and a cab was called to drive her home. She alleged that she was sexually assaulted by the driver (though he was acquitted at his criminal trial). A passenger confined in a small space late at night with the taxi driver is highly vulnerable. That is exactly the type of situation where you want to be able to trust that you will get faithful and honest service. You would be outraged if you are assaulted by the driver, and would expect monetary compensation. This case was recently decided by the Ontario Court of Appeal, and the employer was found not to be financially responsible for any harm caused by its employee.

Sadly, it appears that sexual assault by taxi drivers is a real danger to women, that has happened multiple times in Canada in the past few years.

Unfortunately for this victim, the law allows considerable wiggle room. Employers are liable for an injury if it is closely related to the intended duties of the employee. The taxi driver's job is to drive. If he runs a red light and causes a crash, the employer will usually be responsible. Even though the job gives the driver a unique opportunity to take advantage of vulnerable passengers, an assault on a passenger is so far outside the duties of the job that the employer escapes liability.

The alternative of leaving the innocent victim without recourse to compensation is not a good one.

The Court of Appeal's decision is in line with past decisions of the Supreme Court of Canada. The Supreme Court has ruled that the mere fact that the job gave the employee an opportunity to commit a crime does not make the employer liable. For example, a job as a gardener at a residential school gives the worker a greater opportunity to assault students, but it was found that it would be unfair to the employer, in the absence of other negligence, to make them liable for it.

This approach would be opposed by some modern legal theorists, who argue that the law should take into account the existence of insurance. On that view, it is preferable to impose liability on the party who is best placed to purchase insurance to guard against a risk, and that is usually the employer. The alternative of leaving the innocent victim without recourse to compensation is not a good one.

It should be added that in this case the taxi driver had no criminal record. If there had been evidence that the employer was directly negligent (e.g., it had carelessly hired a driver with a history of committing sexual assaults) the outcome might have been different.

Vicarious liability of employers for the faults of their employees remains a firm principle in Canadian law, and that serves its desired purpose in most cases. Somebody considering the facts of this particular case might consider it surprising and deplorable that the victim failed to get compensation. Judges are bound by the nuances of the common law, which may be grounded in a policy that is based on conditions from the distant past. One could argue that the legislature should step in to modernize the law to bring it more into line with current societal expectations.

Peter Spiro is a Toronto lawyer practicing civil litigation with the Friedman & Associates Law Firm. The legal information in this article is of a general nature, and should not be considered legal advice to the reader.

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