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Employment Law Case Update: Contractors and Vicarious Liability

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The case of Barclays Bank plc v Various Claimants has, over a number of years, been seeking to establish whether companies are vicariously liable for the actions of independent contractors. Our Employment Law team here review the case in further detail and discuss the final ruling by the Supreme Court.

The late Dr Gordon Bates was a medical practitioner with a portfolio practice. From 1968 until 1984 he performed medical examinations for prospective employees for Barclays. Barclays arranged the medical appointments and provided Dr Bates with forms to be filled in. Dr Bates then received a fee from Barclays for each person he examined, but he was not paid a retainer.

Dr Bates examined the prospective employees at his home, always alone in a consulting room. It is alleged that during these consultations Dr Bates sexually assaulted the claimants. The individuals brought a claim against Barclays and argued that the bank should be held to be vicariously liable for the assaults which happened during Dr Bates’ examinations.

The trial court and Court of Appeal found that Barclays was liable before the case was appealed to the Supreme Court.

The Supreme Court reviewed past case law on vicarious liability and concluded that there is still a firm distinction between employment and relationships akin to employment on the one hand, and relationships with an independent contractor on the other. Only relationships of employment or akin to employment give rise to vicarious liability. The question the Court then had to consider was whether Dr Bates was an employee or an independent contractor of Barclays at the time.

The Supreme Court found that while Dr Bates did work for Barclays, he was not an employee of Barclays. In its reasons, the court cited the fact that Dr Bates was not paid a retainer, “was free to refuse an offered examination should he wish to do so,” and “carried his own medical liability insurance” as indicators he was independent of Barclays.

In a further comment, theCcourt also declined to extend the law on vicarious liability to workers. Lady Hale said “it would be going too far down the road to tidiness for this court to align the common law concept of vicarious liability, developed for one set of reasons, with the statutory concept of “worker”, developed for a quite different set of reasons.”

This case follows the recent outcome in the Morrisons case; it therefore firmly establishes that companies cannot be held liable for the actions of independent contractors. The Court also affirmed that while the employment status of a person may be helpful in identifying if they are truly independent, employment status of the individual would not be determinative of vicarious liability. 

If you have any questions regarding this article, you can call our Employment team today on 023 8071 7717 or email employment@warnergoodman.co.uk.

This was previously part of our weekly Employment Law Newsletter. If you would like to subscribe, please email us at events@warnergoodman.co.uk or just fill in our subscription form.

ENDS

This is for information purposes only and is no substitute for, and should not be interpreted as, legal advice.  All content was correct at the time of publishing and we cannot be held responsible for any changes that may invalidate this article.