Vicarious liability under Australian law
The doctrine of vicarious liability effectively serves to render employers liable for the wrongful acts of their employees in so far as those acts are committed in the course or scope of their employment. Generally, if it can be said that the employment relationship created both the “opportunity” and the “occasion” for a wrongful act to take place, the employer will be held liable. This was recently discussed in the High Court in the matter of Prince Alfred College Incorporated v ADC  HCA 37 a matter involving sexual assault
Previous cases have also been decided by reference to the sufficiency of connection between the wrongdoing and the responsibilities of the employee and by the identification of material circumstances or “features” common to certain kinds of cases.
The courts’ focus has generally been to look at the extent to which the employment relationship enabled or facilitated the commission of the wrongdoing.
The “relevant approach”
Drawing from previous judgements, the High Court prescribed the adoption of what it described as “the relevant approach”. According to the relevant approach, the court must consider any special role that the employer has assigned to the employee and the position in which the employee is thereby placed in relation to the victim.
The HCA then went on to state that in determining whether the apparent performance of such a role may be said to give the occasion for the wrongful act, particular features may be taken into account. Clearly contemplating crimes of a sexual nature, it asserted that such features include authority, power, trust, control and the ability to achieve intimacy with the victim.
Applying the relevant approach to the case before it, the HCA stated the appropriate enquiry was whether the employees role as housemaster placed him in a position of power and intimacy in relation to the victim, such that his apparent performance of his role as housemaster gave the occasion for the wrongful acts, and that because he misused or took advantage of his position, the wrongful acts could be regarded as having been committed in the course or scope of his employment.
Significance of the case
This case offers a crucial lesson to employers who might not otherwise realise that they may be held liable for the unlawful acts of their employees, even where they themselves are not at fault.
The HCA has affirmed that each case must be determined on its individual facts and merits. The consequence is that considerable uncertainty and expensive litigation is certain to ensue in cases of this kind.
Employers should ensure that the parameters of their employees’ roles are well defined to minimise the risk of liability arising for acts said to occur in the course of an employee’s duties.
The types of scenarios where employers may be particularly vulnerable to a claim of vicarious liability include schools (and especially boarding houses), hospitals, care facilities, disability clinics and many more (keeping in mind the fact that such claims are not limited to circumstances involving sexual assault or even criminal activity in general).
In order to try and minimise their risk, employers should check:
- that their policies and employment agreements, including codes of conduct, specifically prohibit sexual harassment; and
- that appropriate training is conducted
- Have a trust reported mechanism in place and investigate matter thoroughly when reported.
- Have a proactive investigation mechanism in place when matters or suspicions come to light.
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Details of the case – http://www.austlii.edu.au/au/cases/sa/SASCFC/2015/161.html