Employees Behaving Badly, 1116 SCBJ, SC Lawyer, November 2016, #40
| Author | John W. Fletcher, J. |
What Liabilities Do Employers Potentially Face?
John W. Fletcher, J.
It is every employer’s worst nightmare. You have built up your music store from a small storefront on the edge of town to a sizable business employing dozens of people. You have a beautiful showroom in a great location and developed substantial goodwill in the community. You do your best to carefully select your employees and train them well. You have consulted counsel and enacted detailed policies governing your employees. You take reasonable steps to monitor what they are doing on the job, and you are pleased with their work. Things are going great.
Then, one warm, spring day, an employee does something unexpected and awful. After a difficult breakup with his girlfriend and other personal problems, he gets into an argument with a customer who reminds him of the fellow dating his ex-girlfriend. Out of the blue, he punches the customer in the face, causing serious injuries. Although this occurred in your store during business hours, you are certain that your employee only did this for his own personal reasons. The victim has sued your business because of conduct that you did not authorize and that had nothing to do with the functioning of your business. Now what? You can’t possibly be responsible for your employee’s unpredictable and intentional conduct. Or can you?
The law governing employer liability
Every lawyer knows that the law can hold employers liable for torts committed by their employees in many circumstances. The most obvious cases are those involving employee negligence in the performance of their work duties. From the delivery man involved in an automobile accident to the sales clerk who negligently fails to clean up a spill, those cases involve the employer being held vicariously liable for the employee’s negligence, without regard to the employer’s culpability. The doctrine of respondeat superior provides that the employer is called to answer for the tortious acts of an employee, when those acts occur in the course and scope of the employee’s employment.1 If the employee is acting in furtherance of his employer’s business, he will be regarded as acting within the scope of his employment, even if he exceeds his authority.2 In those cases, the employer’s culpability is irrelevant, as liability is imposed simply by virtue of the employer-employee relationship. There is little controversy over whether an employer may face liability in those cases.
When the employee’s conduct is intentional, rather than merely negligent, the question of vicarious liability will turn on whether the employee’s acts are in the course and scope of employment. In other words, a bar might be liable for a bouncer’s assault of a patron being removed for unruliness. A store may be liable for a loss prevention agent’s overzealousness in apprehending a shoplifting suspect. The focus is on whether the employee w as acting, at the time, in furtherance of the employer’s business.
Liability for acts outside the course and scope
In many cases, however, intentional torts are not committed in the course and scope of employment. As in our example, employees often engage in intentional torts for purely personal reasons. Such circumstances, where an employee intentionally harms someone for reasons not connected to his work duties, present a much more complicated question. In those cases, vicarious liability under a theory of respondeat superior would generally not apply.3 However, that does not end the story.
Even where an employee acts outside of the scope of his employment, the employer still might face liability for failing to properly hire, train or supervise the employee. While this sounds like a broad swath of potential liability, in reality injured persons have a heavy burden to hold an employer liable for purely personal attacks by employees.
South Carolina follows the approach of the Restatement, under which an employer may be liable for negligent hiring, supervision or retention if the employee “intentionally harms another” when the employee: (1) is upon the premises of the employer, or is using a chattel of the employer; (2) the employer knows or has reason to know that it has the ability to control its employee; and (3) the employer knows or should know of the necessity and opportunity for exercising such control.4 This test, thus, focuses on a property-based nexus to the employer and the employer’s knowledge. Under this theory of liability, the employer’s liability is direct, not derivative.5
Involvement of the employer’s property
The first line of inquiry is whether the tort occurs on the employer’s real property. In cases such as our example, this is a straightforward analysis. If the incident occurs on the employer’s premises, the first element of the Degenhart test is satisfied.
However, if the tort occurs off the employer’s premises, so that the plaintiff must rely on the employee’s use of the employer’s personal property, the analysis is more challenging. Then the inquiry turns to whether the employer’s chattel is used to commit the tort. In those cases, the plaintiff must show that the employer’s personal property was in use at the time the third party is harmed.6 It is insufficient for plaintiff to allege the use of an employer’s chattel at some time prior to the harm or injury.7 There must be a nexus between the chattel and the commission of the tort. In other words, the employee must be using the chattel in the actual performance of the intentional tort. Thus, for example, if a security guard is given a weapon by his employer that he uses off the employer’s premises to injure a victim, this element might be satisfied.
In Kase, the court of appeals found that the...
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