Employer Liability

An employer can be held liable for the employee’s fault in a car accident if the employee’s actions were within the scope of employment.

An action is within the scope of employment if the employee performs the action for the benefit of the employer. In contrast, an act is not within the scope of employment if done for the benefit and in pursuit of the employee’s own needs.

To apply this to an example, a pizza delivery man who hits a pedestrian while delivering pizza performs an act within the scope of employment. However, if the pizza delivery man was not delivering pizzas when he hit the pedestrian, but rather was heading home to fetch his lunch, then the act was not within the scope of employment. The distinction of whether or not an act is within the scope of employment depends on the circumstances.

An employer may be held liable for the fault of an employee, but not for an independent contractor. Thus, it’s important to distinguish whether or not the driver of the vehicle was an independent contractor or an employee.

Two different factors are used to determine whether a driver is an employee or an independent contractor. The first factor is the right to control and the second factor is the right to fire or to quit. The right to control refers to the power of an employer to control the manner and means by which the driver accomplishes the task. If an employer does not have this power, then the driver is most probably an independent contractor.

The second factor is the right to fire and quit. This refers to the power of an employer to fire the driver at will and without cause. The presence of this power is a good indicator that the driver is an employee and the driver’s employer may be held liable for the fault of the driver.

The rule is that the act of going to and from the place of employment is not considered as an act within the scope of employment. However, there are several exceptions to this rule.

Exception 1 – Beneficial To the Employer

When going to and from the place of employment is beneficial to the employer it is considered an action within the scope of employment, and thus the employer may be liable for accidents that occur. An example of this is a housekeeper who uses the employer’s car to shop for groceries.  The housekeeper is going to and from the place of employment, but their travel is beneficial to the employer. Similarly, an employee driving home because of illness is also considered as an action within the scope of employment; it’s beneficial to the employer that the employee leave the worksite.

If the nature of the employee’s job requires the use of their personal vehicle, then the employer can be held responsible for the fault of the employee while driving. The employer can also be held liable if the accident occurs while the employee is driving on a trip on the employer’s order. An example of this scenario is a driver who hits a pedestrian while delivering supplies to an office branch. 

Exception 2 – Employer’s Negligence

An employer may also be negligent if the employer entrusts the vehicle to an employee who is unfit to drive. Failure to ensure the safety and maintenance of the vehicle on the part of the employee is also a form of negligence on the part of an employer.