When Is an Employer Liable for an Employee's Workplace Misconduct?

This month, the Fourth Circuit Court of Appeals issued a decision addressing when employers can be held liable for the actions of their employees.  Garnett v. Remedi SeniorCare of Virginia, LLC concerned a situation where an employee went on sick leave for a day.  While she was gone, her supervisor told her coworkers that she was having gynecological surgery and, therefore, must have an STD.  The employee sued the supervisor and her employer for defamation. 

In its opinion, the court confirmed that employers can be liable for their employees’ misconduct, even if the employer never intended for the conduct to occur, if it was done within the employee’s “scope of employment.”  That means that the employee’s improper action must be connected to the employer’s business interests or the employee must be using his position to facilitate the conduct.  The court stated, “In such circumstances, the employer both bears some responsibility for the tort and might have been able to prevent its commission by adopting different or more stringent workplace policies.” 

However, the court affirmed that the employer cannot be held liable if the employee acts independently or in a manner that does not serve any of the employer’s goals.  The fact that the misconduct took place at work will not create employer liability on its own if it does not have any real relationship to the employer’s business mission or serve its interests.  The court noted that the supervisor’s comments were “odious and offensive,” but held that his employer could not be held liable since the supervisor’s duties did not include gossiping to coworkers. 

There are a couple of things that employers can take away from the court’s decision.  First, the court recognized that employers cannot and need not police all of their employees’ interactions. It is not necessary to place cameras in every corner or monitor every water cooler conversation just because someone might say or do something offensive. 

Second, employers need to have policies that spell out what is not acceptable workplace behavior, and they need to enforce these policies.  By taking these precautions, employers can show that they made a concerted effort to prevent employee misconduct and should not be held liable if and when such conduct occurs.

Jeff Wilson is a Pender & Coward attorney focusing his practice on employment law matters, including counseling and business litigation.