Understanding the Facts of the Case
Under the rule of vicarious liability, an employer is liable for injuries caused by its employee, provided that the employee was negligent and acting within the course and scope of the employment. The rationale behind this is that companies with deep pockets are in a position to absorb these losses in its operating budgets, whereas an injured victim may be left underpaid if his or her only recourse is against the other driver, who may not have sufficient insurance coverage to pay the claim.
The “course and scope” of employment requires that the worker be furthering the interests of the employer at the time of the collision. This [clause] means that the worker was doing something for which he or she was hired to do or is in some way benefitting the company. If these elements are met, then the employer could be liable for the injuries and damages of the other driver.
Additionally, the at-fault driver would also be liable to the victim for causing these injuries. This claim would include every item of damages necessary to make the victim whole, such as lost wages, loss of future earning capacity, medical bills, property damage, pain and suffering, loss of the pleasures of life, and other intangible losses such as embarrassment and inconvenience.
An injured worker is also eligible to pursue a workers’ compensation claim against his or her employer, even though that worker was at fault for causing the accident. Pennsylvania’s workers’ compensation system is no-fault, in that the worker’s culpability does not matter. However, the worker is precluded from his or her employer or other employees of the company. The worker is also not eligible for many of the damages that would be available to the other victim.
Under the workers’ compensation system, the worker is only eligible to (1) have his or her medical bills paid, and (2) if unable to continue working, may recover two-thirds of the lost wages. For example, if the worker is totally disabled and unable to work in any capacity, he or she can recover two-thirds of his or her regular paycheck. If the worker is able to work in light-duty capacity, perhaps with fewer hours or less strenuous duties at a lower rate of pay, the worker can still recover two-thirds of that differential between the pre-injury job and the light-duty job.
Thus, the employer could be liable both to the innocent victim for all losses and also to its own employee in a workers’ compensation claim.
Was the employee on the clock and performing job-related duties when the accident happened? Does the employer carry workers’ compensation insurance? Did the employee actually contribute to the accident in any way? The answers to these questions, at a minimum, will offer guidance about whether or not the employer is financially responsible for either (or both) party’s injuries.
Was the employee working?
Employers are, in many states, vicariously liable for the harmful or negligent actions of their employees. So, if an employee gets into a crash while driving a company car, the employer is automatically on the hook for the damages, right? Not so fast. Just because an employee is driving a company car doesn’t mean that they were necessarily working or performing job-related duties, and that’s really the critical component here. Employers aren’t responsible for an employee’s actions when it falls outside the scope of their employment. If an employee happened to be driving a company car on their lunch break or home from work, then their employer wouldn’t be responsible for a collision or resulting injuries to the worker or another party.
Many states require employers to carry workers’ compensation insurance, which is effectively a way to provide injured workers with a path to compensation and protect employers from lawsuits after workplace accidents. Workers’ compensation coverage would likely apply to a work-related crash involving a company car. The employee injured in the accident could potentially recover benefits from their employer’s policy. However, workers’ compensation isn’t a blanket cure-all. Workers’ compensation only provides a very limited scope of benefits, and it only covers employees, which means that other parties injured in the crash may have the right to file a lawsuit against the worker and their employer. Further, some states don’t require employers to carry workers’ compensation coverage, which means that they’re vulnerable to civil claims from their employees after work-related accidents, potentially including car crashes.
Was the employee at fault?
Fault is a really important consideration. An employer will only be responsible for an accident if their employee while performing within the scope of their employment, is at fault. If the employee didn’t do anything to cause the crash, then the employer wouldn’t be responsible for the other party’s injuries. As with many other aspects of personal injury cases, different states have different ways of dealing with the apportionment of fault and liability. If the employee played a small role in contributing to the wreck, then the employer would be liable but only to the degree of the employee’s negligence.
Brian White, Founding partner of Brian White & Associates in Houston, TX, is Board Certified in Personal Injury Trial Law. Over the past 18 years, he has earned a reputation for being a fierce and passionate advocate for injury victims across the state.
Gregg Hollander is a Boca Raton personal injury lawyer with more than 28 years of experience. The founding attorney of Hollander Law Firm Accident Injury Lawyers, he’s recovered tens of millions of dollars for accident victims and their families across South Florida.
The Details Matter
Employers can be responsible for the harmful conduct of their employees. So, if an employee is involved in an auto accident while driving a company car, there’s a chance the employer could be liable for resulting injuries and damages. However, as with all injury cases, the answer really lies in the details.
Scope of Employment
Typically, an employer will only be liable for conduct that’s performed while an employee is on duty. Their actions must also fall within the scope of their employment. In this scenario, the employee must have been working at the time of the accident and exercising some job-related responsibility. If the wreck happened while the employee was running a personal errand or something not within the scope of their job responsibilities, then the employer likely would not be on the hook for crash-related damages.
After a car accident, insurance is typically the first source of compensation. Whose insurance company pays? It depends on the state and on fault. Some states, like Florida, have “no-fault” rules, and parties are required to seek benefits from their own insurance providers, regardless of who caused a collision. Others have fault-based rules, and the negligent party’s provider will be on the hook for costs and damages.
Fault is also important for another reason. Liability only falls on the shoulders of those parties who caused or contributed to the accident. If the employee didn’t play a role in the car accident, then the employer isn’t liable. If the employee did play a role, then it depends on the laws of the particular state in which the crash occurred. Typically, the degree to which a party is liable is proportionate to their degree of blame. The greater an employee’s role in causing a collision, the greater the liability of the employee and their employer.
What happens if the employer carries workers’ compensation insurance coverage? That’s great as far as the injured employee goes. However, workers’ compensation won’t protect the employer from liability if someone else is injured in a crash. In most states, if the employee was even partly to blame, third parties could file civil lawsuits against the employee and employer to recover damages.
Workers’ Compensation Benefits
In New York, if an employee is driving a company vehicle and crashes into another vehicle and both drivers are injured, it will affect the owner of the company.
In New York, the owner of a vehicle is responsible for the negligence of the operator. In addition, a company is responsible for the negligence of their employee. This is known as “Respondeat Superior.” The owner of the company will be responsible for the non-employees injuries and economic loss.
The owner of the company will also be responsible to the driver of his vehicle for workers’ compensation benefits. Those benefits will include medical expenses, lost wages, and a lump sum for his injury.
If the employee of the company was not at fault, he can also make a claim against the other driver for his injuries and economic losses. This is known as a “third-party action.”
If the other vehicle does not have enough insurance coverage to make the employee whole, he can possibly make a claim against the company vehicle for “underinsured” benefits. This claim is only possible if the company vehicle has the proper “Underinsured” SUM insurance coverage.
Alex Maltese, Esq., Principal Attorney at Law Office of Carl Maltese. Attorney Alex Maltese has been a practicing attorney for more than twelve years. Born and raised in Huntington, New York. For his entire career, he has represented the victims of personal injury accidents.
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