Employment Law: Analyzing Employer Liability for Employee Actions

This essay provides an in-depth analysis of employment law, specifically focusing on the complex issue of employer liability for employee actions, particularly concerning vicarious liability and instances of sexual harassment. It explores the legal principles of vicarious liability, where employers can be held responsible for the misconduct of their employees, even when the employer is not directly involved. The essay examines the concept of agency, where an agent acts on behalf of a principal, and how this relates to employer liability. It also investigates the significance of the Human Rights Code and how it influences employer responsibility for discrimination and harassment in the workplace, including off-duty conduct. The essay contrasts legal positions, and provides insights into the challenges of determining what constitutes "course of employment" and how courts balance fairness and the deterrence of future harm. The essay also examines related case law to illustrate the evolving nature of employment law.

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Employment Law
Final Term Paper
20-Mar-18
(Student Details: )

Employment Law
Introduction
There are a number of recent and highly publicized cases where the employers have been
held to be liable for the off premises or the off duty conduct of the employee, which has raised a
lot of concerns on the employers’ part in context of the scope of their liability. Quite rightly, the
employers fear the spectre of liability in indeterminate amount for indeterminate time to
indeterminate class of individuals regarding the employees conduct (Holland & Cortina, 2016).
The key concern is related to the employee conduct which takes place in situations where the
employer does not have effective control over the employee, for instance in cases of conduct at
social functions or the off premises conduct. Even though the employers do not face unlimited
liability in such cases, they still need to be vigilant about the possible risks and have to take steps
in eliminating or minimizing such risks. Often questions are raised on such cases being worth the
time and effort (Lublin, 2015).
This discussion is particularly focused on the employers being made liable for the acts of
the employees which are out of the scope of employment, particularly in context of sexual
harassment in workplace. In doing so, a comparison and contrasting would be undertaken of the
legal position, and even the opinion of writer would be elucidated.
Legal Issues
Vicarious Liability
The term vicarious liability relates to instances where the court holds one party liable for
the undertaken misconduct of another person, even when the party which is being made liable for
such misconduct has not undertaken any wrong on their own part (Petkov, 2015). This issue
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required the courts to allocate the liability to one of the two innocent parties, in terms of the one
which was the victim of wrongful act or the party which hired the wrongdoer. In K.L.B. v. British
Columbia 2003 SCC 51, it was held that where the risks which are inherent to the enterprise of
party and these materialize to cause harm, it would be fair and useful to impose liability on such
party (Morgan, 2016). An employer is held liable vicariously for the wrongful acts which are
undertaken by their employee in the course of employment of such person. There are many cases
where the liability is raised for the employer even when the employee acts beyond the scope of
employment. Even though the employers can be made liable vicariously in a number of cases, it
has been recognized by the courts that the employers are not responsible for every wrong
undertaken by employee as being their involuntary insurers, as was seen in E.B. v. Order of the
Oblates of Mary Immaculate in the Province of British Columbia 2003 BCCA 289 (Berta, 2003).
When it comes to course of employment, the case laws prove to be of help. In the cases
of Jacobi v. Griffiths (1999) 174 D.L.R. (4th) 71 and Bazley v. Curry (1999) 174 D.L.R. (4th) 45,
were two cases in which the meaning of wrong undertaken by employee in their course of
employment were explored. These cases covered tragic situations where the children had been
abused sexually by the institution employees. The Supreme Court, through the cases of M.B. v.
British Columbia 2003 SCC 53 and E.D.G. v. Hammer 2003 SCC 52 reaffirmed these principles.
So, where the employee acts had been authorized by employer, or were closely connected to
authorized acts, the employer would be made liable. Now, this presents a grey area in the opinion
of the writer, as deciding which act would be deemed as associated or connected to authorized
acts is hard to determine, and is prone to prejudice. This is because the principle of vicarious
liability is applied based on fair compensation policy for the victim and the deterrence of future
harm. Where such happens that the court feels that the victim needs to be compensated, they may
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held the undertaken act of the employee as an act associated to authorized acts and make the
employer liable (Berta, 2003).
Agency
Agent is a party which is empowered by another party which is referred to as the
principal to undertake activities on their behalf, and are given with the legal obligations and
rights with the third parties. The liability of the principal in context of the agent’s wrongful act
depends on consideration which matches the ones which are involved in the determination of
vicarious liability for the wrongful acts of employee on the employer. The central issue in agency
relationship is the scope of authority of agent. The terms acting in course of employment, acting
in scope of agency and acting within the given authority have similar meanings as was held in
Lloyd v. Grace, Smith & Co., [1912] A.C. 716 (H.L.) at 736 (Berta, 2003).
The issues are not raised when the case is of actual authority as the authority in such
cases is given to the agent in an express or implied manner. The issue is raised when it comes to
ostensible authority where the conduct of thee principal is such that a reasonable individual
supposes the presence of authority with the agent. Again, where the principal carelessly allows
the agent to act on their behalf, they would be made liable to the third party. Where the agent
indulges in acts like sexual harassment in workplace, in context of the same being done to a
client, which becomes the third party in this case, the employer can be made liable (Berta, 2003).
For instance, the employer had been asked to take the client on a site visit. In this course,
the employee takes the client to lunch as well, where the said instance of sexual harassment takes
place. In such a case, even though the employee did not work based on his scope of employment,
since he was not asked to take the client on lunch and yet did so, the employer would be liable.
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This would be done based on ostensible or apparent authority. The reason for this is that the
client is not aware of such absence of authority and the employer thus has to be held liable even
when the employee acted beyond their scope of employment (Berta, 2003).
Opposing Views
Human Right Code
An employer is made liable for any kind of discrimination which is undertaken based on
the Human Right Code at the workplace, and can also be held responsible for harassment which
is undertaken, as it is deemed as a discriminatory conduct, taking place at employer sponsored
social events out of work hours. Each jurisdiction has their version of human right code in
Canada, for instance there is the British Columbia Human Rights Code and then there is the
Ontario Human Rights Code (Smit & Viviers, 2016). In the case of Robichaud v The Queen
[1987] 2 SCR 84; (1988) 40 DLR (4th) 577, the Supreme Court of Canada made the employer
liable for the discriminatory act which had been undertake by the employee in the course of
employment. The term course of employment has been clarified through a number of cases, to
demonstrate that it covers the conduct of employee which takes place out of workplace and out
of working hours, but still continue to be within the scope of employment (McCarthy Tétrault
LLP, 2001).
The situation where the liability of employer takes place in high spirits and relaxed
atmosphere of social setting, where the employees cross their appropriate boundary of conduct,
can be elucidated through the case decided by British Columbia Human Rights Tribunal. In
Simon v Simpson, a complaint regarding discrimination against the plaintiff was undertaken
owing to sexual harassment which took place at the retreat for managers of the employees during
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the of-duty hours. The complaining party had been asked to attend this event at bed and breakfast
by the general manager in Sooke. The business meeting was held on first evening of retreat. A
number of managers decided to go to a hot tab after the business portion of the meeting was
concluded. The plaintiff changed into swimsuit for going in the hot tub. Upon getting to the hot
tub, the general manager had been sitting in the hot tub along with two female managers sitting
on his lap, topless. Nearly for the next ten minutes, the plaintiff had been asked repeatedly by the
general manager and the other employee to take off her swimsuit. She was informed that she had
been hired as they assumed her to be cool but she was not acting in such manner. Further, they
even told her that if she wanted to be part of management team, she was required to take off the
swimsuit. However, the plaintiff refused to do so and left that place. As a result of this incident,
she was resigned. It was held by the tribunal that Simon was subjected to sexual harassment
during her employment and had been forced to resign owing to such harassment (McCarthy
Tétrault LLP, 2001)..
Now where this scenario is compared to the common law, the employer would not have
been made liable. The reason for this is that here no authority was given to the agent to act in
such way; also, these were not the acts undertaken within the scope of authority which would
have given rise to vicarious liability. Conversely, this can be used as a precedent under the
common law, and this would mean that despite the vicarious liability and the agency principle
explained here, the employer would be made liable. This case can be at best taken as guidance on
what can be deemed as within the scope of employment. So, where the common law and
statutory codes contrast each other, they can bring harmony to a particular matter as well
(McCarthy Tétrault LLP, 2001)..
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In the case of Canadian Broadcasting Corp. and Canadian Media Guild (Christopher)
(Re) [File No. C-I/98, the arbitrator had upheld discharge of employee who had been sexually
harassed by another employee while they had been far from the premises of workplace and had
undertaken during the non working hours. In such a case, the griever had gone on a lunch with
their co-worker and later on attempted to kiss her in restaurant’s parking lot. This harassing
conduct had taken place between the employees and was deemed as conduct requiring discipline
despite the fact that it had not taken place in workplace. Now, where this case is seen in context
of the aforementioned cases, it shows a contradictory behaviour. Yet, there is commonality in
between the common law and this case in terms of upholding the fair principle. So, where the
court feels it is necessary to uphold fairness in any case, particularly to protect the victim, they
would undertake decisions which could support or oppose the precedents and the stated laws
(McCarthy Tétrault LLP, 2001)..
Another example of such taking place is Leach v. Canadian Blood. Services, 2001 ABQB
54, where the employer dismissed the employee which indulged in sexual harassment, in terms
of forcing to kiss an employee. There are cases where the cases converge with common law
where the employer is made liable to a third party. For instance, in C.L. v. Badyal (c.o.b. Amrit
Investments), [1998] B.C.H.R.T.D. No. 67 (QL), the sexual discrimination was held to be within
course of employment by the employee even when the employee was off duty. The tribunal
stated that the pub had been liable for discriminatory actions of employee as it was undertaken in
the course of their employment, even when the individual was off-duty. So, the employer can be
made liable for the conduct of employee towards third party even when the employee is not on
duty. The only thing which had to be kept in mind in such cases was that the employee acted on
behalf of business of employer, be it unauthorized or misguided. In sense of justice, such
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decisions are fair as the victim is properly compensated; yet in the sense of fairness towards the
employer, they can seem to be harsh at times. This is the reason why this topic continues to be of
controversy, particularly when the victim is one suffering from sexual harassment (McCarthy
Tétrault LLP, 2001).
Conclusion
Thus, from the discussion which had been undertaken in the previous paragraphs, it can
be concluded that the liability of employers for the actions of employees, outside their scope of
employment is a controversial topic. The courts upheld the general rule of being fair towards the
justice in deciding upon this matter. This is particularly true in cases of sexual harassment taking
place at workplace. The common law provides that even when the employee acts out of their
scope of employment, the courts can make the employer liable for the acts of employees in terms
of fairness towards the victims. And this is rightly done, as it is crucial that the victim is properly
compensated; though at times, it may feel prejudiced against the employer.
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References
Bazley v. Curry (1999) 174 D.L.R. (4th) 45
Berta, J. (2003). Employer Liability for the Wrongful Acts of its Employees. Retrieved from:
https://www.mccarthy.ca/pubs/Wrongful_Acts.pdf
C.L. v. Badyal (c.o.b. Amrit Investments), [1998] B.C.H.R.T.D. No. 67 (QL)
Canadian Broadcasting Corp. and Canadian Media Guild (Christopher) (Re) [File No. C-I/98
E.B. v. Order of the Oblates of Mary Immaculate in the Province of British Columbia 2003
BCCA 289
E.D.G. v. Hammer 2003 SCC 52
Holland, K. J., & Cortina, L. M. (2016). Sexual harassment: Undermining the wellbeing of
working women. In Handbook on well-being of working women (pp. 83-101). Dordrecht:
Springer.
Jacobi v. Griffiths (1999) 174 D.L.R. (4th) 71
K.L.B. v. British Columbia 2003 SCC 51
Leach v. Canadian Blood. Services, 2001 ABQB 54,
Lloyd v. Grace, Smith & Co., [1912] A.C. 716 (H.L.)
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Lublin, D. (2017). What counts as workplace sexual harassment in Canada? Retrieved from:
https://www.theglobeandmail.com/report-on-business/careers/leadership-lab/what-
counts-as-workplace-sexual-harassment-in-canada/article37137194/
M.B. v. British Columbia 2003 SCC 53
McCarthy Tétrault LLP. (2001). Employer Liability for an Employee’s off Premises Conduct.
Retrieved from: http://www.mccarthy.ca/article_detail.aspx?id=625
Morgan, P. (2016). Fostering, Vicarious Liability, Non-Delegable Duties, and Intentional Torts.
Law Quarterly Review, 132, 399-404.
Petkov, N. (2015). Canada: When Employees' Wrongs Are The Employer's Responsibility.
Retrieved from:
http://www.mondaq.com/canada/x/414202/employee+rights+labour+relations/
When+Employees+Wrongs+Are+The+Employers+Responsibility
Robichaud v The Queen [1987] 2 SCR 84; (1988) 40 DLR (4th) 577
Smit, D.M., & Viviers, D.J. (2016). “Vicarious” Liability of the Employer in Sexual Harassment
Cases: A Comparative Study. Journal of Business, 01(01), 41-59.
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