Could an employer be liable for an employee's actions at out of work drinks?
The Court of Appeal recently ruled on the issue of the scope of vicarious liability in circumstances where an employee’s wrongful conduct occurs both outside the work place and outside of office hours. The case of Bellman v Northampton Recruitment Limited considered the actions of a managing director at impromptu post-Christmas party drinks.
Mr Bellman was an employee of Northampton Recruitment Limited (“NR”) and Mr Major was its M.D. NR organised a Christmas party, which was followed by an impromptu few drinks at a hotel where some of the employees of NR were staying. In the early hours the conversation turned to work and a disagreement arose between Mr Bellman and Mr Major regarding the terms and placement of a new employee. Mr Major “summoned” the remaining employees (approximately 50% of NR’s staff) in the hotel lobby and lectured them that the business decisions were his to make. Mr Bellman raised a question, which resulted in him being punched twice by Mr Major. The punches caused Mr Bellman traumatic brain damage.
At first instance, the Judge had ruled that NR would not be liable for the actions of Mr Major, on the basis that there was insufficient connection between Mr Major’s position at NR and his wrongful conduct.
On appeal the Court of Appeal focused upon the following two points when making its decision:
1.broadly, what was the nature of Mr Major’s job and what was “within the field of activities” assigned to Mr Major; and
2.whether there was a sufficient connection between the position of Mr Major and his wrongful conduct to hold NR liable.
Firstly, the court reviewed Mr Major’s field of activities. Mr Major, as M.D. of NR, had responsibility for all management decisions including maintenance of discipline and had authority to issue instructions to more junior employees. Based on this, Mr Major’s remit and authority was very wide.
On the second point, the Court of Appeal disagreed with the Judge at first instance. It decided that Mr Major was acting as M.D. of NR, under his wide remit, when the disagreement occurred. When his managerial decision was challenged, he “chose to wear his metaphorical M.D.’s hat and to deliver a lecture to his subordinates” and the attack arose out of a misuse of the position entrusted to Mr Major. The context of the evening’s events was also important, as the events took place after a work event organised and paid for by Mr Major, who had been fulfilling his managerial duties. In addition, the taxis between the party venue and the hotel were paid for by Mr Major, as were the majority of the drinks at the hotel. As a result, the court came to the conclusion that Mr Major was not a fellow reveller but present as M.D.
After considering the above, the court concluded that, based upon the facts, there was a sufficient connection between Mr Major’s field of activities and the wrongful conduct, that NR should be vicariously liable for Mr Major’s actions.
The court’s decision to find NL vicariously liable for Mr Major’s actions should be of concern to employers, especially those with a smaller workforce and with work Christmas parties just around the corner. Business leaders should be cautious in assuming work status on the one hand and then later pleading informality and impromptu drinks as a defence. The lesson is to train and remind leaders now before the party season starts.To discuss any of the issues raised in this article or for specific employment law advice, including details of our training, please contact Joan Pettingill or any of our experienced employment law team.
Tel: 0114 2283 252
Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.