Vicarious Liability : Was the employer liable when the Managing Director punched an employee after the Christmas party?

We are once again approaching that time of year when businesses are organising work Christmas parties and festive lunches.

Whilst they can be a good opportunity for employees to relax and get to know each other away from their desks, Christmas parties also raise other issues for employers to consider. This includes whether they can be vicariously liable for something that goes wrong at work related events, or shortly after them.

Unfortunately this is a common issue that we see, particularly in relation to discrimination claims, such as for harassment. Employers can also have vicarious liability if an employee causes an injury to another member of staff.

Vicarious liability

The concept of ‘vicarious liability’ in an employment relationship, involves an employer being liable for the unlawful actions of an employee, where there is a sufficient connection between the unlawful action and the employee’s employment. It would not matter that the employer itself committed no wrong. For example the aggrieved employee could sue their employer for the actions of another employee.

One interesting case from 2018 tested this principle during the festive season.

Mr Major was the Managing Director of Northampton Recruitment Limited. The company Christmas party was held at a local golf club. Following the party, half of the guests including Mr Major and an employee called Mr Bellman, went to a hotel where some were staying. The company paid for the taxis to the hotel but it was an impromptu extension of the party. A controversial work matter arose at around 2am after all had been drinking heavily on the company’s bill. Mr Major proceeded to lecture those present about the situation, Mr Bellman then challenged Mr Major in a non-aggressive manner and Mr Major lost his temper. Mr Major punched Mr Bellman twice, with the second blow knocking him out and causing him to fall. He sustained brain damage. Mr Bellman brought a claim for damages against Northampton Recruitment Limited on the basis the company were vicariously liable for Mr Major’s conduct.

Initially the High Court decided that the company did not have vicarious liability for the director’s assault on the employee. The High Court used the following reasoning:

• A line could be drawn between the work party and the ‘impromptu’ drinks as this was not a planned extension of the Christmas party;
• It would be unfair for the director to always be considered ‘on duty’ because he was in the company of other employees, regardless of the circumstances; and
• The assault was committed after, not during, a work social event.

This decision was appealed to the Court of Appeal though who overturned the decision and decided that the company was vicariously liable for the director’s actions.

They confirmed there were two clear questions which had to be answered:

1. Broadly speaking, what are the functions or field of activities entrusted to the employee?
2. Was there sufficient connection between the position in which the person was employed and the wrongful conduct to make it right for the employer to be held liable?

Liability will not arise just because there is an argument about work matters between colleagues, which leads to an assault, even when one colleague is markedly more senior than another.

In this case, Mr Major was the “directing mind and will” of a relatively small company and had responsibility for all management decisions. He had a very wide remit. The drinks were not an impromptu gathering but followed on from an event paid for by the company and at the time the event occurred, Mr Major had put his “managing director” hat on and was delivering a lecture to the other employees. He wasn’t discussing the football or a non-work related issue. The Court decided that the attack arose whilst he was asserting his authority as the managing director.

The case acknowledged that the facts of a situation will always be important and this situation was potentially unusual. However, given the facts there was sufficient connection between Mr Major’s job as Managing Director and the assault and so his actions should be considered as “in the course of employment” and the company should be vicariously liable for his actions.

If you need any advice relating to this, please feel free to contact a member of the Employment team. Otherwise we hope you enjoy the Christmas celebrations this year, however you are celebrating.

Bellman v Northampton Recruitment Limited