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Arizona Supreme Court rules employer not vicariously liable for out-of-town employee’s after-work automobile accident that injured motorcyclist

An employer could not be held vicariously liable for an after-work accident caused by an employee who was on an extended assignment away from home, ruled the Arizona Supreme Court, resolving a dispute among state courts (Engler v Gulf Interstate Engineering, Inc, July 9, 2012, Berch, R). At the time of the accident, the employee was not serving the employer’s interests in traveling to a restaurant during his off hours, and the employer did not control where, when, or even if the employee chose to eat dinner. Because the employee was not subject to the employer’s control, he was not acting within the scope of his employment at the time of the accident, so the employer was not liable for his actions.

International commute. The employee worked on the design and construction of a natural gas compressor in Mexico. He lived in Houston and traveled each week to the construction site. His employer reimbursed the employee’s business expenses, including his rental car and other travel expenses to and from the job site. Because his work required him to cross an international border each day, the employer considered the employee’s work day to begin when he left his hotel in Arizona and to conclude when he returned. However, during after-work hours, the employer did not attempt to supervise the employee or control his activities.

Following the completion of a workday, the employee and a coworker left the hotel in his rental car and headed to a restaurant. On the way back to the hotel, the employee made an improper left turn and hit a motorcycle driven by the plaintiff, who sustained serious injuries. The plaintiff sued the employee and the employer for his injuries, alleging that the employer was vicariously liable. The trial court granted summary judgment to the employer. However, 13 days later, a state court of appeals issued an opinion in McCloud v Kimbro, holding “that an employee on out-of-town travel status is within the course and scope of his employment and subjects his employer to vicarious liability while traveling to and from a restaurant for a regular meal.” The plaintiff moved for a new trial, but the trial court distinguished McCloud and denied the motion. The Arizona Supreme Court granted review to resolve the apparent conflict between McCloud and this case.

Employer control. The doctrine of respondeat superior generally holds an employer vicariously liable for the negligent work-related actions of its employees. However, the employer is vicariously liable for such acts only if the employee is acting “within the scope of employment” when the accident occurs. To determine the course and scope of employment, Arizona courts have long considered the extent to which the employee was subject to the employer’s control. Relevant factors for determining whether an employer exercised actual control, or retained the right to control the employee’s conduct when the negligent act occurred, include the previous relations between the employer and the employee and whether the act: (1) was the kind the employee was hired to perform; (2) was commonly done by the employee; (3) occurred within the employee’s working hours; and (4) furthered the employer’s purposes or fell within the employer’s enterprise.

Applying these factors to evaluate negligent driving by an employee on out-of-town travel status, the Arizona high court concluded that “an employee’s tortious conduct falls outside the scope of employment when the employee engages in an independent course of action that does not further the employer’s purposes and is not within the control or right of control of the employer. In this instance, the employer did not exercise control over the employee at the time of the accident. Once the employee returned to his hotel at the end of the work day, he was free to do as he wished. The fact that he ate dinner with a work colleague did not transform the social occasion into a business activity. Consequently, because the employee was engaged in an independent course of action not intended to serve his employer’s work purposes, the employer was not vicariously liable.

Workers’ compensation principles. The state high court declined to apply workers’ compensation principles to this case as urged by the plaintiff. Workers’ compensation and tort law differ in purpose and scope, observed the court. Workers’ compensation covers injured employees, whereas respondeat superior subjects employers to liability for injuries suffered by third persons. The concept of “scope of employment” when used in the tort context is tied to the employer’s right to control the employee’s activity at the time of the tortious conduct.

To the extent that McCloud suggested that employees generally are acting within the course and scope of their employment when “driving to a restaurant” while off duty during an extended out-of-town assignment “because eating is incidental to a multiple-day assignment,” the Arizona Supreme Court disagreed.