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Where does the law draw the line for the vicarious liability of an organisation for the wrongs of its independent contractor?
The “independent contractor test” was set out by Lord Justice Ward in a case brought against the Catholic Church in 2012 “…the law is clear: the employer is not vicariously liable for the torts of his independent contractor”
However, a recent decision this year in a class action brought against Barclays Bank, where it was alleged the bank was liable for the sexual assaults carried out by its self-employed doctor when conducting medical examinations of its recruits, ruled against the appellant in the Court of Appeal. Lord Justice Irwin in passing judgement commented that if it had intended for the once decisive test to survive, the Supreme Court would probably have said so.
L J Erwin also considered that there would be cases where vicarious liability was established in respect of independent contractors “Changes in the structures of employment, and of contracts for the provisions of services, are widespread. Operations intrinsic to a business enterprise are routinely performed by independent contractors, over long periods, accompanied by precise obligations and high levels of control…”
What was once a fairly clear divide has become less so, reflective of the changes in employment structure and the ‘gig’ economy, “a labour market characterised by the prevalence of short-term contracts or freelance work, as opposed to permanent jobs”. The boundaries of employers duties and their vicarious liability are widening, making it important for businesses to factor in these risk changes and to adapt.
Johnson Insurance Services works closely with its clients to understand their business and lay out your risk transfer options so they can make an informed decision based on the facts. For more information, please do not hesitate to give Johnson Insurance Services a call on 01937 222139 or send an email to email@example.com
#insurance #vicariousliability #gigeconomy #risk #adaptability #change
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