Who Pays When Employees Crash Their Cars After Hours? It Could Be You….

by Orrick - Global Employment Law Group
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One would think that, under the “going and coming” rule, employers could never be liable for torts committed by their employees during the employees’ commutes. Think again. If employers require employees to use their cars or the employers’ car for work, then employers may be liable for their employees’ car accidents that occur during their commutes. This may also be true when the accident occurs during a side trip to satisfy the employees’ frozen yogurt cravings or attend their yoga classes. In the past month, two California courts have addressed these issues, but reached different results.

In Moradi v. Marsh USA, Inc., the California Court of Appeals (Second District) held that a company was vicariously liable for its employee’s accident that occurred during the employee’s commute home. The employee was a traveling insurance salesperson. Her employer required her to use her personal vehicle to visit customers, develop outside sales, and attend work functions on a daily basis. One day, on her way home from the office, the employee decided to make a side trip to attend a yoga class, but then also had a sudden frozen yogurt craving and stopped at a yogurt shop on her way to yoga. As she was pulling into the parking lot, she collided with a motorcyclist and injured him. The motorcyclist then sued the employee and her employer for his injuries.

In analyzing whether the employer could be vicariously liable, the Court of Appeals first held that the personal vehicle exception applied to the general “going and coming” rule because the employer regularly required the employee to use a car for work purposes. Thus, the employer could be on the hook for the employees’ accidents during her commutes. The Court then held that the employee’s frozen yogurt/yoga class detour was a foreseeable and minor deviation from her drive home, which did “not change the incidental benefit to the employer of having the employee use her personal vehicle to travel to and from the office and other destinations.” Accordingly, the Court of Appeal found that the employer could be vicariously liable for the accident.

Several days later, in Halliburton Energy Services, Inc. v. Department of Transportation, another Court of Appeals (Fifth District) reached the opposite conclusion. In that case, the employee was assigned a company-owned pickup truck to drive as part of his work as a driller. The employer allowed the employee to use the truck to commute to and from work and to run personal errands during his commute route. One morning, after finishing a shift, the employee drove approximately 100 miles to Bakersfield to meet his family to help his wife buy a car. Later that day, as the employee was returning from Bakersfield to work an evening shift, the employee struck a van carrying several adult passengers. The passengers sued the employee and his employer.

Unlike in Moradi, however, the appellate court affirmed that the employer was not liable. The Halliburton court distinguished Moradi, holding that the Moradi employee’s side trip to the yogurt shop was a “minimal deviation from the employee’s commute home” and was “minor and foreseeable.” Thus, her employer could be liable for her conduct. In contrast, according to Halliburton, the employee’s 100-mile excursion to meet his family “was entirely personal. . . and such a complete and material departure from his employment duties that that it could not reasonably be considered to be an activity in pursuit of the employer’s business or a minor deviation from the strict course of the employee’s duties. . . and the risk of a traffic accident during this personal trip was not a risk inherent in or typical of or broadly incident to Halliburton’s enterprise.”

While Halliburton did not extend liability as far as some employers feared, employers should still take note of some of the important issues the courts discussed in these two cases. For example, companies who require employees to use their personal vehicles for work should consider the court’s discussion in Moradi about how this may create potential liability for accidents caused by those employees during their commute.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Orrick - Global Employment Law Group | Attorney Advertising

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