At a glance

The Court of Appeal’s decision in Bellman v Northampton Recruitment Limited [2016] EWHC 3104(QB) is a timely reminder that “what happens at the party after-party does not necessarily stay at the party after-party” and that an employer can be vicariously liable for an employee’s conduct,  even where that conduct  takes place outside of work time and outside of the workplace.

This briefing note, examines the (fact-specific) details of this case involving the assault of an employee by a director of a company, extrapolates the key legal principles attaching to vicarious liability and provides some guidance as to the steps employers can take to protect themselves from claims.

Facts

Mr Bellman was a sales manager at Northampton Recruitment Limited (the Company). 

On 16 December 2011, Mr Bellman went to his work Christmas party.  The party was attended by twenty-four people in total (employees and their partners), including the Managing Director of the Company, Mr Major.

It is pertinent to the facts of this case (and ultimately to the Court’s decision) that the Company was a round-the-clock operation and that Mr Major (who had no set hours and complete  authority to control his own methods of work) was the “directing arm” of the Company, with a wide remit and an authority stretching across the business.

When the work party ended, Mr Major paid for taxis to take all those who wanted to go to the hotel (where some of the employees were staying that evening at the Company’s expense) for further drinks.  

Mr Major paid for the further drinks and, as the night progressed, the conversation turned to work.  When Mr Bellman referred to a contentious issue involving a new employee who was believed to be paid significantly more than anyone else, Mr Major lost his temper.  He started shouting and swearing at Mr Bellman, reiterating to everyone that he was in charge of the business and he could do whatever he wanted. He then punched Mr Bellman twice.  Following the second blow, Mr Bellman fell over and hit his head, resulting in a significant brain injury.

Mr Bellman (via his litigation friend) alleged that the Company was vicariously liable for his injuries and he took his case to the High Court.

The High Court concluded that there was a significant difference between the Christmas party and the after-party drinks and held that the circumstances were so far removed from Mr Major’s employment that the Company was not vicariously liable.

Court of Appeal

Mr Bellman appealed to the Court of Appeal on the grounds that, in particular, the wrongful conduct was triggered by a challenge to Mr Major’s managerial authority. The Court agreed.   

The Court took into account the Supreme Court’s judgment  in the case of Mohamud v W M Morrison Supermarkets Plc [2016] AC677, which set down two questions that must be considered when deciding on vicarious liability:

1. What functions or “field of activities” have been entrusted by the employer to the employee? This is to be looked at objectively, taking account of the wrong-doer’s position within the business.It is not a question of whether or not the wrong-doer was expressly authorised to do the act in question.

And

2. Was there a sufficient connection between the position in which the employee was employed and the wrongful conduct to make it right for the employer to be held liable?

The Judge concluded that, despite the fact that the incident occurred outside working hours and in a social setting, there was a sufficiently close connection between Mr Major’s position as Managing Director and his conduct towards Mr Bellman.  It was not an impromptu get-together but a planned gathering instigated and paid for by Mr Major.   During the course of the evening, Mr Major chose to flex his managerial muscles when his authority was challenged.  His conduct did not arise in the context of a personal discussion.  The conversation had focused on work for the previous 45 minutes leading up to the incident with Mr Bellman.  In lecturing staff on the remit of his authority, the Court of Appeal held that Mr Major was wearing his metaphorical “Managing Director’s hat” - a function entrusted to him by his employer – and could not be regarded as being off-duty at that point.  Accordingly, vicarious liability for Mr Bellman’s injuries could be established.

Comment

It is important to note that these facts are unusual and this case does not mean that employers will become automatically liable for the violent conduct between staff, even where one is more senior than the other.  In this case, Mr Major made a conscious decision to assert his authority and, in doing so, changed the context from a social to a more formal, work setting. 

However, the decision is still significant.  It chimes with the cultural sea-change  in attitude towards the abuse of power brought about by the #metoo and #timesup movements and clarifies the fact that an employer may be liable for conduct between staff, in any environment or setting, where that environment or setting has been facilitated, co-ordinated or organised (but not necessarily pre-planned) by the employer.

In advance of the festive season, organisations should take steps to minimise their exposure to risk by:

• setting out the standards of behaviour expected from staff;
• updating harassment and equal opportunities guidelines;
• taking robust disciplinary action against those involved any inappropriate conduct;
• restricting or limiting the availability of alcohol; and
• reminding managers that they remain, at all times, representatives of the organisation.

If you would like to discuss any of the issues raised above with one of our lawyers, please contact Prettys Employment Team on 01473 298291