Vicarious Liability & Employee Drivers
“Vicarious liability” refers to a situation where someone is held responsible for the “actions or omissions” of another person. In a workplace context, an employer could be held liable for the acts or omissions of its’ employees, provided it can be shown those acts took place in the course of their employment. (http://www.acas.org.uk/index.aspx?articleid=3715)
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An area for which vicarious liability could come into play would be the Business Auto and employees who may drive company owned vehicles or personal vehicles on company business. In the normal underwriting process, the insurance carrier requires a list of employees who may operate company owned vehicles. Information such as drivers’ license number, date of birth, and in some cases, Social Security numbers, is necessary to request an MVR (Motor Vehicle Record). The MVR’s are then reviewed by the carrier to determine eligibility.
Employers are well within their rights to require an MVR from a prospective and/or current employee. The MVR should be part of the hiring process for prospective employees as well as a background, credit, and criminal history. Often we receive a negative response from business owners when this idea is suggested. Most often, it is the time and expense to obtain the MVR. A cost efficient option would be to require the prospective employee to either go “online” and instantly obtain, download, and print his or her MVR, or contact their local DMV for a minimal cost. The link is https://www.ncdot.gov/dmv/offices-services/records-reports/Pages/driving-records.aspx.
Failure to review and evaluate the MVR of a prospective or current employee and/or allowing an employee with a known “poor driving” history to operate a company owned vehicle could be deemed as negligence by an aggressive plaintiff attorney in the event of an incident. Either way, the employer could be held to the legal doctrine of “vicarious liability”. The employer could also be held vicariously liable in the event of a claim if they were unaware and allowed the employee to operate a company owned vehicle. Should an accident occur involving a death, the employer could be subject to a wrongful death suit which could result in a “punitive damage” award, which in many policies is not covered by insurance.
In conclusion, we recommend employers obtain and review MVR’s on prospective and existing employees operating company owned as well as personal vehicles used on behalf of the employers (mail pickup, banking, etc) at a minimum of every 3 years. Drivers could be deemed ineligible subject to the following criteria:
Driving under the influence of drugs or alcohol within the past five years
Reckless driving or negligent homicide with a motor vehicle within the past five years
More than two speeding or other minor traffic violations within the past three years
Drivers must have five years driving experience (learners’ permit and out of country licenses not included)
More than one at-fault accident within a three year period
Combination of three or more violations (at fault or not) within a three year period
Rest assured the insurance carrier will continue to review driver’s MVRs on a regular basis. As always, do not hesitate to contact our offices at (252) 446-6156 with any questions or comments. Thank you!