Next week the Supreme Court will hear the Appeal in WM Morrison Supermarkets PLC v Various Claimants. This blog considers why every business owner should sit up and take notice.

What's changed already?

Seventy years ago the Scottish courts refused to find an employer liable for an employee who caused an explosion by having a sly cigarette in a coal mine because they deemed it to be outside the course of his employment. The last few decades have seen a very significant shift in the law of, what is known as vicarious liability. Today it is perfectly possible that a business may be found liable for the acts or omissions of a person who was not an employee, even where those acts were criminal.

You may remember media reports of organisations being found liable for the criminal acts of teaching staff in historic sexual abuse cases. As a business owner you may think this has no relevance to you but you could be wrong.

The English courts have already found employers liable for serious assaults perpetrated by employees against customers while at work or by one employee on another when away from work. It is now more than possible that employers could be held liable for injuries inflicted by on or off duty staff on anyone else. Whether liability attaches may depend upon the status of the staff member involved and the circumstances of the assault.

What is about to change?

The WM Morrison case is ground breaking because the English Court of Appeal found it liable for a breach of data protection legislation perpetrated by a disgruntled employee solely to harm his employers. Next week the Supreme Court will consider the claim brought by 5,518 employees against the supermarket. The internal auditor who leaked the data had done so in his own home, using his own computer, on a Sunday and several weeks after he had illegally downloaded the data onto his own USB stick. The court of appeal who ruled in favour of the claimants even found that the employee had done what he did for the sole purpose of causing harm to his employers.

Arguably the common theme in all of these cases is where the business or organisation has placed the wrongdoer in a position that enabled them to cause harm the courts have been inclined to burden the business or organisation with the consequences of that harm.

What can you do about it?

Take advice before anything goes wrong. Make sure your risk assessments and policies are up to date. Do they cover the risks and do they identify what steps you might need to take to mitigate those risks? Does your insurance cover the identified risks?

Proactively addressing and mitigating risk is much less problematic than dealing with the consequences of things going wrong.