Introduction
Vicarious liability is a legal doctrine where one party, often an employer, is held responsible for the torts (civil wrongs) committed by another, typically their employee. For this to occur, two main conditions must be satisfied. Firstly, there must be a relationship of employment, or one which is 'akin to employment', between the defendant and the wrongdoer. Secondly, the tort must be sufficiently connected to the nature of that employment (Horsey and Rackley, 2021). This second stage, known as the 'close connection' test, has been a source of legal debate, particularly in cases involving employees who deliberately act against their employer’s interests. This essay will examine the principles of vicarious liability in the context of a 'rogue employee' by analysing the Supreme Court’s landmark decision in WM Morrisons Supermarkets plc v Various Claimants [2020] UKSC 12.
The 'Close Connection' Test
The modern test for establishing the necessary connection between the employment and the tort was established in Lister v Hesley Hall Ltd [2001] UKHL 22. In that case, the warden of a school boarding house sexually abused children in his care. The House of Lords held that the employer was vicariously liable because the warden's torts were so 'closely connected' with his employment that it was fair and just to hold the employer liable. The abuse was interwoven with the duties he was employed to perform, such as caring for the children. This test requires a court to consider the nature of the employee's job and whether the tort was committed within the 'field of activities' assigned to the employee. However, the application of this test became uncertain in cases where an employee acted out of personal malice towards their employer.
WM Morrisons Supermarkets v Various Claimants
The central issues were clarified in WM Morrisons Supermarkets plc v Various Claimants [2020]. The case concerned Mr Skelton, a senior IT internal auditor at Morrisons, who held a grudge against the company following a disciplinary procedure. Skelton was tasked with transmitting payroll data to external auditors. In an act of revenge, he copied the data of nearly 100,000 Morrisons employees onto a personal USB stick and later uploaded it to the internet, also sending it to several newspapers. The affected employees brought a group action against Morrisons for the data breach, arguing that the company was vicariously liable for Skelton's actions.
The High Court and the Court of Appeal both found Morrisons vicariously liable. They reasoned that there was an unbroken chain of events from Skelton's authorised tasks to the wrongful disclosure, and that his role gave him the opportunity to commit the tort. However, the Supreme Court unanimously overturned this decision.
The Supreme Court's Reasoning
Lord Reed, giving the judgment, reaffirmed the two-stage test for vicarious liability. The key question was whether Skelton's wrongful disclosure was sufficiently 'closely connected' with the activities he was authorised to do. Lord Reed stated that the lower courts had misunderstood the principles from Lister. The correct approach is to ask what the employee’s functions or 'field of activities' were, and whether there was a sufficient connection between the position in which he was employed and his wrongful conduct.
The Supreme Court held that Skelton's duties were to receive the data, store it, and disclose it to the auditors. His malicious act of leaking it to the public was not part of his field of activities. Critically, the Court considered his motive. Skelton was not acting, even misguidedly, in furtherance of his employer's business; he was pursuing a personal vendetta. His actions were described as a 'frolic of his own' (Joel v Morison (1834) 6 C & P 501), meaning something so far removed from his employment that the employer should not be held responsible. The fact that his employment gave him the opportunity to commit the wrong was not enough to establish vicarious liability.
Conclusion
The decision in WM Morrisons provides important clarification on the limits of vicarious liability. It confirms that the motive of the employee can be a relevant factor in determining whether their tortious act is closely connected to their employment. Where an employee acts for reasons of personal vengeance, rather than in connection with their employer’s business, vicarious liability is unlikely to be imposed. This decision provides a degree of protection for employers from the malicious and unforeseeable acts of 'rogue' employees, ensuring that the doctrine does not extend so far as to make employers insurers for all wrongs committed by those they employ.
References
- Horsey, K. and Rackley, E. (2021) Tort Law. 7th edn. Oxford University Press.
- Joel v Morison (1834) 6 C & P 501.
- Lister v Hesley Hall Ltd [2001] UKHL 22.
- WM Morrisons Supermarkets plc v Various Claimants [2020] UKSC 12.
