H Vicarious Liability - The Law of Workplace Sexual Harassment in Canada
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H Vicarious Liability

H Vicarious Liability

In a common law civil action, the plaintiff will typically seek to make the employer responsible for the conduct of its employee. Consideration on this question should also be given to the statutory remedy which, it is submitted, shows a lower bar to pass, and indeed, in certain instances, the employer is directly liable. This is particularly so in Ontario which allows a civil action to attain the statutory remedy.

Basic Tests

There are two arguments possible. The first is the organic theory of liability in the context in which the offensive actions have been taken by the “directing mind” of the corporation. Such a circumstance puts liability on both the individuals and the company.

The second argument is the plea of vicarious liability. Such a finding strict liability, without the need to prove negligence on the part of the employer. A finding of liability against the employee will then attach such liability upon the employer without fault on its part for the wrongdoing.1

No VL for Fiduciary Duty Claim ?

Interestingly, the Nova Scotia Court of Appeal2found that a claim which is founded only on a breach of fiduciary duty, with no accompanying tort claim, will not support a claim for the vicarious liability of the employer. This is so as this obligation is a personal one and is not delegable. There may be liability as a co-fiduciary but this is a distinctive plea.

A subsequent decision of the Ontario court did not reference the above decision on this specific issue, although the reasons of the Nova Scotia court were mentioned for an unrelated issue in the Ontario decision. Other defences were raised by the defence, the Ontario government, on the question of vicarious liability, but this issue was not raised as a defence.3

This was also the result in a second Ontario trial decision.4

Employment Relationship

The most frequent relationship which creates vicarious liability is that of employee and employer.5

It does not, however, follow that once such a relationship is established, that liability will follow. Conduct which is only coincidentally linked to the business of the employer and the duties of the employee cannot justify the imposition of vicarious liability. The conduct in these cases is independent of the employment situation and further the employer was not in a position to prevent this behaviour. The conduct must be closely and materially related to the risk introduced or enhanced by the employer for vicarious liability to be imposed6

 For example, should a man assault his wife’s lover, a co-worker, in an employee’s lounge, the employer should not be seen as accountable. Equally, a security guard who decided to commit arson for his own amusement would not give rise to strict liability.

Conduct which is only coincidentally linked to the business of the employer and the duties of the employee cannot justify the imposition of vicarious liability. The conduct in these cases is independent of the employment situation and further the employer was not in a position to prevent this behaviour. The conduct must be closely and materially related to the risk introduced or enhanced by the employer for vicarious liability to be imposed.

The basic premise of the cases finding strict liability is that the conduct of the employee falls within the ambit of the risk created by the business, or enhanced by it. The policy arises where the wrong is so connected with the employment that it can be said that the employer has introduced the risk itself.

Hence where the risk is closely associated with the wrongful conduct, the employer should bear the risk and internalize the full cost of operation, including such liability. But where the wrongful act does not have a meaningful connection to the business, liability should not flow. The “mere opportunity” to commit a tort does not suffice. The business and employment must not only provide “the locale or the bare opportunity for the employee to commit his or her wrong, it must materially enhance the risk, in the sense of significantly contributing to it, before it is fair to hold the employer vicariously liable.”7

Prior Cases Inconclusive – VL 101

In determining the application of vicarious liability on a policy basis, courts should be guided by the following principles, where precedent cases are inconclusive8, to determine liability in cases of unauthorized intentional wrong.

  1. The question of liability should be openly confronted and not disguised under the rubric of “scope of employment” and “mode of conduct”;
  2. The basic issue is whether the maligned conduct is sufficiently related to the authorized conduct. There should be a significant connection between the creation or enhancement of a risk and the resultant wrong that so accrues, even where this is unrelated to the employer’s objectives.

Degree of Connection – Five Part Test

To assess the sufficiency of the connection between the employer’s creation or enhancement of the risk, and the conduct in question, the following factors should be considered, in determining liability for intentional conduct:

  1. the opportunity that the business gave the employee to abuse his power;
  2. the extent to which the wrongful conduct may have furthered the employer’s aims;
  3. the extent to which the acts in question were related to friction, confrontation or intimacy inherent in the business;
  4. the extent of power conferred on the employee in relation to the victim;
  5. the vulnerability of potential victims to the wrongful exercise of the employee’s power.

In an Alberta civil action for sexual harassment, the factors considered were that (1) the personal defendant  was her boss and consistently one of the only other persons in the office, (2) he was her direct boss, (3) she was led to believe that he was the only person in charge, (4) the two were often alone and (4) there was no corporate policy on sexual harassment. These factors, as noted by the Court of Appeal, materially enhanced the risk of tortious actions.9

An exception was taken to this decision by a B.C. decision10firstly noting that the above case did not fully apply the first step by asking the question of “whether there are any precedents which unambiguously determine whether vicarious liability should apply in the circumstances”.

More significantly, the court did not refer to other decisions where courts have looked carefully at the policy considerations which are significant in the second step of the analysis.

In the application of the connection between the creation of the risk and the wrong, “incidental connections to the employment enterprise, like time and place (without more), will not suffice”.

The court found against the imposition of vicarious liability as (1) the opportunity given to the personal defendant to abuse his power was not significant, (2) the assignment of work was done openly, (3) there was ample opportunity for employees to raise issues about work or work assignments to senior management, (4) the wrongdoing did not further the employer’s aims, (5) there was no friction, confrontation or intimacy inherent in the business, (6) there was nothing in the business of residential plumbing service which created situations of intimacy between employees, (7) the power given to the wrongdoer was supervisory with respect to the plaintiff, but limited and such power was not one which could be readily abused.

The very fact of supervision of one employee of another, the court stated, should not give rise to vicarious liability.11

From a broad policy overview, a contrary finding, the court stated, would create economic hardship to the business community.

A classic example of the application of the principle is found in a 2000 Ontario decision dealing with persons confined to a provincial mental institution and subjected to horrendous forms of abuse by doctors employed by the Crown. 12

A B.C. court considered a fact situation in which an employee of a Rogers store assaulted a customer in a dispute over the employee’s entitlement to a customer discount. 13. The court found no suitable precedent after which it considered the same tests as above and, surprisingly, found the employer vicariously liable for the assault. One would expect that a physical attack upon a customer would be a remarkable departure from the standard of conduct expected of a customer service representative. The court found as follows:

I find Wang committed the battery as an improper and unlawful response to what BC Wireless Solutions acknowledges was a conversation involving a commercial transaction related to its business. Wang was trained to watch out for attempts by customers to obtain discounts to which they were not entitled and sought verification of the Plaintiff’s entitlement to the discount. This caused the Plaintiff to become upset and aggressive towards Wang. It was part of Wang’s employment responsibilities to “deal with angry customers”. Wang’s battery of the Plaintiff was how he chose to deal with an angry customer. I find there is a significant connection between the conversation which created the friction and risk, and the intentional and wrongful battery of the Plaintiff by Wang.

Taxi Cab Driver & Intoxicated Female Passenger

The Ontario Court of Appeal recently considered the above tests in a case involving a taxi cab driver who had committed a sexual assault in the course of his job responsibilities.14 The Court noted that the application of the above test becomes more difficult in the case of an authorized intentional wrongdoing such as sexual assault.

The trial judge had found in favour of the employer but had not specifically set out his analysis of the five factors above. The Court of Appeal did so, based on the evidentiary record.

First Factor Opportunity – Opportunity for Abuse

The Court saw this issue as “not negligible” as intoxicated passengers, as in this case, must be trusting of the driver. The cab driver has a form of power and has the ability to create chances for abusive conduct. The Court saw, however, the opportunity for misconduct as “not as intimately connected to his functions”,not comparable to the child caregiver in Bazley and closer to the groundskeeper in Jacobi.

Second and Third Factors – Does Wrongdoing Extend the Employer’s Business; Extent to which the Business Purpose related to friction, confrontation or intimacy inherent in the business;

 The assault did not promote the employer’s business purpose and was “not related to friction, confrontation or intimacy inherent in the employer’s aims”. The Court found that the fact that the employer did not require or permit physical contact between the driver and the passenger “in any intimate body zones” was influential. In fact the company’s written directions were to avoid physical contact and dating requests.

Fourth Factor – Extent of Power Conferred on the Employee in Relation to the Victim;

To this issue, the Court noted that the employer delegated no power on the driver with respect to the plaintiff. It did not know that it as sending its driver to pick up a lone, intoxicated woman. The Court stated:

The relationship between the driver and the appellant was that of adult driver and adult fee-paying passenger.  Arguably, what power the driver had, he arrogated to himself through his own decisions.

Fifth Factor Vulnerability

Clearly a lone drunk woman was vulnerable. However, as the Court stated, while this is an important factor, the power of the driver is not predicated on his employment. In any event, vulnerability does not per se provide the “strong link”:

Moreover, as Binnie J. wrote for the majority in Jacobi, “vulnerability does not itself provide the “strong link” between the enterprise and the sexual assault that imposition of no-fault liability would require” (para. 86).

The strong connection required for the finding of vicarious liability failed. Further from a policy prospective, the Court was not moved by the need to find “deep pockets”:

  Further, the appellant has not demonstrated, in this case, that imposition of vicarious liability would further the broader policy rationales of fair compensation and deterrence used to justify it.

 Common Carrier

The Manitoba Court of Appeal 15 considered and applied the argument that the liability of a taxi cab company should be determined as that of a “common carrier”, a finding that led the court to the conclusion that the taxi cab company was under the duty of an implied contract that amongst other duties, requires its drivers to exercise reasonable care for the safety of its passengers. The breach of such obligation will render the company responsible for the damages suffered. In this case, the passenger had proven that the driver did not complete the route as requested and exposed the plaintiff to pneumonia.

This argument was not made in the Court of Appeal case referenced above.

The Manitoba decision cited with approval an American decision which specifically dealt with the implied condition of the contract that the passenger should be free of assault:

In Fornoff v. Columbia Taxicab Company, 179 Mo. App., 620
162 S.W. Reporter, 699, the Saint Louis Court of Appeal, at page
701 in the latter reports, declared the duty owed by a taxicab oper
ator to his passenger as follows:

When the relation of passenger and carrier is established, the passenger
surrenders himself into the care and custody of the carrier.
This implies an obligation on the part of the carrier, not only to transport
the passenger to destination … but to discharge him on arrival
free from assault on the part of its servants; that is, in the proper

and further:

…without the exercise of reasonable care by a driver, a passenger is subjected to risk and suffers therefrom, the carrier is responsible for the damages arising.

The Court of Appeal came to this conclusion:

There appears to be no doubt that taxicab companies, as common
carriers, are under the same obligations, duties, and responsibilities
to their passengers as any other common carrier; that in every hiring
of a taxicab there is an implied contract that the passenger will be
carried safely to his destination; that passengers have a right to
expect drivers of taxicabs to possess a complete knowledge of the
locality in which the company operates; that if, through lack of
knowledge, mistake of location, or other causes, it is found im
possible to reach the passenger’s destination, the driver is bound to
exercise every reasonable care for the safety of his passengers; that
if, without the exercise of reasonable care by a driver, a passenger
is subjected to risk and suffers therefrom, the carrier is responsible
for damages arising.

This issue is far from over.



  1. In K.T. v Denis Vranich, Elixir and Paradise Lane Developments Hamilton Inc.; Hudson v Youth Continuum, Phillip Brindle and The Brindle Agency Inc.; Shulz v Attorney-General and upheld on appeal. Shulz was a case alleging verbal abuse and was not a sexual harassment case.
  2. Nova Scotia v Carvery N.S. C.A. March 2016
  3. Baker v Baker
  4. C.O. v Williamson
  5. SCC 671122 Ontario Ltd. v. Sagaz Industries Canada Inc. [2001] 2  SCR  983
  6. Supreme Court of Canada in Bazley v Curry
  7. Bazley
  8. This is the first step, to ask of “whether there are any precedents which unambiguously determine whether vicarious liability should apply in the circumstances”.
  9. Pawlett v Dominion Protective Services 2007 ABQB 415
  10. Corfield v Shaw
  11. Manitoba Court of Appeal decision in Robertson v Manitoba Keewatanowi where it saw no material connection to support the vicarious liability submission.
  12. Barker v Barker
  13. Gill v Wang
  14. Ivic v Lakovic Leave to appeal denied.
  15. Mizenchuk v Thompson

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