Employer Not Vicariously Liable for Abuse Between Adult Co-Workers in Commercial Enterprise
Reasons for judgement were released last week by the BC Supreme Court, Victoria Registry, addressing whether an employer should be found vicariously liable for harm caused by sexual abuse committed by one worker against another. In short the Court found that without an employer giving more than an opportunity for abuse by virtue of “time and place” vicarious liability should not apply.
In last week’s case (Corfield v. Shaw) the Plaintiff was victimized on a number of occasions by her supervisor at work. The supervisor was found liable and ordered to pay damages. The Court was asked to find the employer vicariously liable for the abuse but refused to do so finding that the law should not extend liability in these circumstances. In dismissing the claim against the employer Mr. Justice Butler provided the following reasons:
 The question a court must consider where there has been a sexual battery is whether the unauthorized acts of the employee are so connected with authorized acts that “they may be regarded as modes (albeit improper modes) of doing authorized acts”. In Bazley, the court set out a two-step process for determining when an unauthorized act is so connected to the employer’s enterprises that vicarious liability should be imposed. The first step is to consider whether there are precedents which unambiguously determine whether vicarious liability should apply in the circumstances. The second step is to determine whether vicarious liability should be imposed in light of the policy rationales behind strict liability.
 The parties did not fully argue the first step analysis; whether there are precedents applicable to the vicarious liability analysis in this case. This is likely because very few decisions which have considered the vicarious liability of employers since Bazley involve adult co-workers in commercial enterprises. ..
 In the absence of prior decisions which unambiguously determine whether vicarious liability should be found, I must proceed to the second step of the analysis. This is described at paras. 41 and 42 in Bazley. At this stage of the analysis, a court is to “openly confront the question of whether liability should lie against the employer”. That is done by considering if there is “a significant connection between the creation or enhancement of a risk and the wrong that accrues”. Incidental connections to the employment enterprise, like time and place (without more), will not suffice. Once engaged in a particular business, it is fair that an employer be made to pay the generally foreseeable costs of that business. In contrast, to impose liability for costs unrelated to the risk would effectively make the employer an involuntary insurer.
 At para. 41 of Bazley, McLachlin J. (as she then was) set out some of the factors that may be considered by a court to determine if there was a strong connection between what the employer was asking the employee to do (i.e. the risk created by the employer’s enterprise) and the wrongful act:
(a) the opportunity that the enterprise afforded the employee to abuse his or her power;
(b) the extent to which the wrongful act may have furthered the employer’s aims (and hence be more likely to have been committed by the employee);
(c) the extent to which the wrongful act was related to friction, confrontation or intimacy inherent in the employer’s enterprise;
(d) the extent of power conferred on the employee in relation to the victim;
(e) the vulnerability of potential victims to wrongful exercise of the employee’s power.
 At para. 46, McLachlin J. summarizes the approach to this step:
In summary, the test for vicarious liability for an employee’s sexual abuse of a client should focus on whether the employer’s enterprise and empowerment of the employee materially increased the risk of the sexual assault and hence the harm. The test must not be applied mechanically, but with a sensitive view to the policy considerations that justify the imposition of vicarious liability __ fair and efficient compensation for wrong and deterrence. This requires trial judges to investigate the employee’s specific duties and determine whether they gave rise to special opportunities for wrongdoing. Because of the peculiar exercises of power and trust that pervade cases such as child abuse, special attention should be paid to the existence of a power or dependency relationship, which on its own often creates a considerable risk of wrongdoing.
 When I apply the relevant factors to the circumstances of this case, I conclude that there was not a strong connection between what Mr. Shaw was asked to do and the sexual assaults he committed. The opportunity afforded to Mr. Shaw to abuse his power was not significant or unusual. The assignment of work was done openly. There was ample opportunity for employees to raise issues about the work or work assignments with senior management, Mr. Baker. The wrongful acts did not further the employer’s aims in any way. It cannot be seriously contended that there was friction, confrontation or intimacy inherent in the business of Baker Industries. There was nothing about the operation of a residential service plumbing business that created situations of intimacy between employees. While Mr. Shaw was provided with supervisory authority in relation to Ms. Corfield and other employees, the power given to him was not extensive. As I have already noted, it was not power that could be easily used for a wrongful purpose. Finally, plumbers in the employ of Baker Industries would not be expected to be potentially vulnerable to the wrongful exercise of Mr. Shaw’s authority as a supervisor.
 In short, there is nothing about the enterprise of Baker Industries or the authority imparted to Mr. Shaw that materially increased the risk of sexual assault of fellow employees. Quite simply, this is a situation where Mr. Shaw took advantage of incidental connections to Ms. Corfield that occurred in an employment relationship. He took advantage of the opportunities of time and place. That alone is not sufficient for a finding of vicarious liability.