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Texas high court rejects employer liability for worker conduct

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in Compensation and Benefits,Employment Law,Hiring,Human Resources,Leaders & Managers,Management Training

by Mike Buchanan, Ogletree Deakins, Dallas

The Texas Supreme Court recently issued two decisions limiting when employers can be held responsible for the wrongs committed by their employees. The cases offer hope that employers won’t always bear the brunt of their employees’ wrongdoing, as has often been the case in the past.

Traditionally, employers can be liable for employees’ torts committed within the course of their employment. Torts are wrongful acts or damages subject to civil action. Employers are especially at risk when torts arise out of work-related disputes or occur while employees are performing their jobs.

In one case, the Supreme Court ruled that an employer was not liable for the acts of an on-duty security guard. In a second case, the court held that employers do not owe a duty to protect the public from the acts of an off-duty employee, even if the employer knew that the employee was intoxicated and agitated.

In both cases, the key factor was the degree of control employers exercised over the employees’ actions.

On-duty conduct

A nightclub, Fifth Club, hired David West, a certified peace officer, as an independent contractor to provide security. Late one evening, the club denied admission to Roberto Ramirez, allegedly because he was intoxicated. After a doorman asked West to escort Ramirez away from the entrance, West allegedly grabbed Ramirez and slammed his head against a wall, knocking him unconscious. Ramirez sued West and Fifth Club.

A jury found Fifth Club vicariously liable for West’s conduct and for negligently hiring him. After the court of appeals agreed, Fifth Club appealed to the Texas Supreme Court.

The court initially noted that employers generally don’t have a duty to ensure that their independent contractors perform work in a safe manner. However, they can be vicariously liable for contractor actions if they retain control over the manner in which the contractor performs the work.

Fifth Club told West to remove Ramirez from the club entrance, but not how to do it. There was no evidence that Fifth Club controlled how West went about his task, so Fifth Club could not be held vicariously liable for West’s actions.

The Supreme Court also refused to recognize Ramirez’s claim that Fifth Club should be held vicariously liable because it hired West to perform security work. It wrote, “We see no reason to expand an employer’s liability for the acts of its independent contractor solely because the contractor is hired to perform security work.” The character of West’s work was not sufficient to impose liability, so the court dismissed the suit. (Fifth Club, Inc. v. Ramirez, No. 04-0550, Supreme Court of Texas, 2006)

Off-duty conduct

Roger Tingle worked for Loram Maintenance of Way, Inc. (LMW), a company that refurbishes railroad tracks. LMW employees typically work 12-hour shifts while on the road with their families, staying in motels paid for by LMW.

During his employment, Tingle allegedly began using drugs. Evidence presented at trial suggested that Tingle started to become moody and unstable. At one point, he threatened a friend with a knife and the incident was reported to management. On another occasion, he got into an argument with his wife and forced her into their car. When he threatened her with a knife, she jumped out of the car and screamed for help. When El Paso police officer David Ianni tried to intervene, Tingle shot him.

Ianni sued LMW for negligently retaining an incompetent, unfit and dangerous employee; failing to properly control or supervise him; and allegedly condoning his drug use. A jury found that the company’s negligence caused Ianni’s injuries. The Texas Court of Appeals affirmed, and LMW appealed.

The state Supreme Court noted that employers rarely have an obligation to control the off-duty conduct of an employee. However, if an employer does take action, it has a duty to act reasonably and to avoid making the situation worse. Merely knowing that an employee is impaired or intoxicated is not sufficient to create a duty to control off-work conduct.

The court noted that Tingle was off-duty for at least an hour before shooting Ianni. Moreover, LMW did not exercise any control over Tingle after he left work.

Just knowing that Tingle was agitated when he left work was insufficient to impose a duty to affirmatively take action, and LMW did not owe a duty to protect Ianni from Tingle’s off-duty conduct. (Loram Maintenance of Way, Inc. v. Ianni, No. 04-0666, Supreme Court of Texas, 2006)

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Mike Buchanan is a shareholder in Ogletree Deakins’ Dallas office. He is board certified in labor and employment law by the Texas Board of Legal Specialization.

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