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Employment Law: Vicarious liability

10 May 2016

Employment Law: Vicarious liability - read more

Employers can be held responsible for crimes committed by staff at work

The recent case of Mohamud v WM Morrison Supermarkets plc confirmed the full extent of vicarious liability of employers.

On 15 March 2008, Mr Mohamud visited a Morrisons petrol station and was subjected to a racist verbal and physical assault by Mr Khan, an employee of Morrisons. Mr Mohamud brought a claim against Morrisons for compensation (subsequently continued by his family upon his death from an unrelated illness).

It was held by the High Court and the Court of Appeal that the case failed the ‘close connection test’, on the basis that there was not a sufficiently close connection between what Khan was employed to do and his conduct towards Mr Mohamud.

The Supreme Court disagreed and held that the close connection was passed and Morrisons was vicariously liable. Lord Toulson held in the judgment, ‘It was a gross abuse of [Khan’s] position, but it was in connection with the business in which he was employed to serve customers … his employers entrusted him with that position and it is just that, as between them and the claimant, they should be held responsible for their employee’s abuse of it.’

Although on the face of it this may seem to be a surprising decision, it has not altered the law on vicarious liability. If there is sufficiently close connection between an employee’s wrongdoing and the employment the employer will be held liable. Each case will of course turn on its own facts.

Childcare vouchers during maternity leave

The Employment Appeal Tribunal (EAT), in the case of Peninsula Business Services v Donaldson, has held that a company can lawfully suspend access to a childcare voucher scheme during maternity leave. The ET’s decision at first instance was that this practice was discriminatory.

The company policy, as is not uncommon, is to suspend access to the childcare voucher scheme during various types of absence, including maternity leave. The claimant looked to join the scheme while pregnant but refused to agree to the condition that the benefit would be suspended during maternity leave. It was claimed that the refusal to provide this benefit is discriminatory.

The respondent argued that the nature of the vouchers and the prohibitive cost of continuing to provide the benefit during maternity leave would lead to the company, and many employers, withdrawing the benefit all together.

The EAT held that this practice was not discriminatory as long as the vouchers are provided in return for a reduction in pay (for example, via a salary sacrifice scheme) and is therefore not a benefit of employment and therefore protected during maternity leave. The EAT considered that continuing to pay the vouchers would in effect be a windfall for employees and therefore unfair.

However, if the childcare vouchers are provided as a benefit without any deduction in pay, the childcare vouchers should still be paid during maternity leave.

In short, employers who provide vouchers through a deduction scheme are not legally required to continue to pay childcare vouchers to women on maternity leave. Employers who provide childcare vouchers as a benefit are legally required to continue to provide childcare vouchers during maternity leave.

One note of caution in relation to this judgment – the claimant did not attend the appeal hearing to provide evidence and therefore full arguments in relation to the case were not heard.

Shared parental leave

It has recently been reported that 1% of fathers had taken the opportunity for shared parental leave. In fact, the research by My Family Care and the Women’s Business Council upon which these headlines were based suggested that 1% of men (rather than fathers) in the organisations surveyed had taken up the opportunity of shared parental leave.

However, this appears to be misleading. Out of 1,000 employees surveyed, 100 had had a baby or adopted a child in the past 12 months and 24% of women and 30% of men had taken shared parental leave.

Similar findings were also made in a small survey of 628 carried out by Totaljobs. In the Totaljobs survey, out of the 86 respondents who had become parents, 31% had utilised shared parental leave, 48% had not utilised the right and 21% had said that they were not eligible.

The small number of participants involved in these surveys and the relatively short period of time that the right to shared parental leave has been available mean that it cannot be asserted that 30% of men will take parental leave.

However, on the face of it these initial surveys suggest that the take up of shared parental leave by men is far higher than the 1% reported in the press or the 2−8% predicted by the government.

Lydia Newman is an Employment Solicitor

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