In this post, we’re going to discuss how business owners can prevent lawsuits caused by an employee. An employee’s conduct during the course of business can be the basis for a lawsuit against your company, this is referred to as “respondeat superior” which is Latin for “let the master answer.”
What is Respondeat Superior?
Respondeat superior refers to a situation when the conduct of an employee leads to a lawsuit against the company, opposed to the individual employee being sued because a company is deemed responsible for the conduct of its employees. This legal responsibility does have limits, for example, if an employee commits an act which is clearly outside the bounds of their tasks, then the employee’s behavior may not lead to an actionable matter. However, if an employee’s accident leads to injuries against an outside party, and the accident was caused by normal business conduct, then damages might be recoverable against the employer.
Hypothetical: A store owner hires a part-time worker to clean the store and part of the worker’s job duties is to put a “Caution: Wet Floor” sign whenever the floor is mopped. One day, the worker forgets, and a customer slips, falls, and breaks an arm. The customer may initiate a lawsuit against the store for the medical bills despite the accident being caused by the worker’s negligence.
How can employers prevent these kinds of lawsuits?
When you realize that you might be liable for an action performed by an employee, your first instinct should be to minimize the probability of this from occurring. Perhaps the best thing a business owner can do is to provide thorough on-site education for employees. Employees need to be fully educated about how their behavior can potentially affect others, including visitors or customers. Although some accidents may be inevitable, you can certainly minimize accidents through education.
Sound Hiring Process
Another way to prevent employee generated lawsuits is through a sound hiring process. Just as much as on-site education, the hiring process can provide an excellent tool to prevent litigation. This is because you need to use the hiring process as a screening device to weed out candidates who will create risk for the company. There are ways you can probe potential employees for their likelihood to comply with corporate rules put the company at risk.