There are two ingredients for vicarious liability: an employment relationship/one akin to employment, plus an act done within the field of employment activities. A useful way of thinking about it is Relationship + Act = Vicarious Liability.
There has been a broadening of both sides of the formula. With the Supreme Court case of Mohamud v WM Morrisons Supermarket plc[i], the ‘Act’ part of the formula has gone from an act closely connected to employment, to an act which is in the field of activities of the duties expected of the employee.
With the increase in historical sexual abuse claims, the Courts have had to consider relationships outside of the traditional employer/employee sphere. The first ingredient, the relationship part of the formula has been equally, if not more, stretched in recent times. The original test was establishing an employer/employee relationship. This was widened to include relationships “akin to employment.” Helpfully, Lord Phillips set out 5 characteristics which were a pre-requisite to a finding of a relationship akin to employment in the case of Various Claimants v Catholic Child Welfare Society[ii].
Those 5 characteristics were considered by the High Court in England and Wales in the case of Various Claimants v Barclays Bank.[iii] The background to this claim: Barclays Bank instructed individuals to attend for medical examinations by a doctor, either as an employee or as part of the employment application process. Unfortunately, during the examinations, the doctor subjected them to deliberate sexual assaults. The Court looked at the 5 characteristics to decide whether the bank / doctor relationship could be regarded as “akin to employment” as follows:
The employer is more likely to have the means to compensate the victim than the employee.
Yes- the claimants could not pursue the doctor. He had died in 2009 and his estate had been distributed. His insurers also refused to indemnify, as these were deliberate sexual assaults.
Was the tort committed as a result of activity by the doctor on behalf of the bank?
Yes – the examination was part of each victim’s t’s & c’s and the bank dictated the identity of the doctor and its location and time.
Was the doctor’s activity part of the business activity of the bank?
Yes –the bank wanted to ensure that it recruited healthy and effective employees who were physically suitable for the work.
Did the bank create the risk of the doctor committing the assaults?
Yes- the bank spelt out the nature of the examination, which included chest examinations and required the Claimants to undress to their underwear.
Was the doctor under the control of the bank?
Yes- because they directed the questions to be asked and physical examinations to be performed, which were recorded on a template supplied by the bank to the doctor. It also exercised control in directing the victims to be examined by the doctor.
Finally, the Court looked at whether or not the second ingredient, the “Act” was established and decided that the incidents were inextricably interwoven with the carrying out of duties for the bank.
A similar analysis was carried out in another 2017 case of Armes v Nottinghamshire County Council;[iv] the claimant in had been placed into foster care by the local authority in the 1980’s. She was placed with couple A, where she was physically and mentally abused and she was sexually abused by Mr B. The foster parents were not a mark for judgment and the local authority was pursued under vicarious liability, with the claimant arguing that the local authority / foster parent relationship was one “akin to employment”.
The courts analysed the 5 factors mentioned above and in both the High Court and the Court of Appeal, the claim failed on the control points i.e. the Local Authority did not exercise sufficient control over the foster parents and the provision of family life. The courts viewed the control exercised by the Local Authority as at a higher, or macro level, as opposed to micro management of the day to day family environment. However, the Supreme Court disagreed. It decided that it is not necessary for there to be micro management. In deciding this, it looked at the statutory framework and regulations which applied at the time and found that the Local Authority had powers of approval, inspection, supervision and removal without any parallel in ordinary family life. Furthermore, it possessed parental powers such as medical treatment of the child, the level of contact between the child and its biological family, whether the child could have a passport and go on holiday. It therefore found for the claimant.
An original quest for social justice in finding that an employer should be liable for its employees’ acts has come full circle, as once again, the stretch in the test for vicarious liability appears arguably to have been influenced by the deep pockets / innocent victim school of thought to the detriment of working relationships outside the traditional employer/employee sphere.
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[i]  UKSC 11
[ii]  UKSC 56
[iii]  EWHC 1929
[iv]  UKSC 60