The Supreme Court has ruled in Barclays Bank plc v Various Claimants that employers will not be vicariously liable for the actions of a self-employed person whom they have engaged, if the individual is genuinely in business on their own account. It overruled the Court of Appeal and found that Barclays Bank was not vicariously liable for sexual assaults carried out by a doctor whom it had engaged as an independent contractor to carry out pre-employment medical examinations.
It is established case law that an employer can be vicariously liable for certain acts of its employees or those in relationships sufficiently "akin to employment". In an earlier case, the Supreme Court had set out five "policy reasons" which would usually make it fair, just and reasonable to impose vicarious liability. These five factors are: (i) the employer is more likely to have the means to compensate the victim and more likely to be insured; (ii) the tort is committed as a result of activity undertaken on the employer's behalf; (iii) the activity is likely to be part of the business activity of the employer; (iv) the employer, by employing the individual, created the risk of the tort being committed; and (v) the individual is to some degree under the control of the employer. However, the Supreme Court has now confirmed that the key question remains whether the individual is carrying on business on their own account; if this is clear, then there is no need to consider the five factors. The five factors would only be relevant in doubtful cases to decide whether workers who were technically self-employed or agency workers were effectively part and parcel of the employer's business so as to make it fair, just and reasonable to impose vicarious liability.
In this case, the doctor had been in business on his own account with a portfolio of patients and clients, which included the bank; he was paid per assessment and could refuse to do an examination. On these facts the doctor was an independent contractor and the bank was not vicariously liable for his actions.
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