Employer Liability for Employees’ Actions

August 19, 2013  |  Jennifer C. Moreau

Minnesota recognizes three negligence causes of action in which an employer is liable to a person for injuries caused by an employee: negligent hiring, negligent retention, and negligent supervision. This article will describe these causes of action.
The Basics
Negligence imposes a duty upon an employer to exercise reasonable care if the employer’s action creates a foreseeable risk of harm or injury to another. Though the particular injury need not be foreseeable, it must have been reasonable to expect so that a sensible person would take precaution. If the connection between the harm and the employer’s act is too remote, no liability will be imposed.
Negligent Hiring
An employer is liable for negligent hiring if it hires someone for a position through which the employer knows, or should have known through investigation, the employee would pose a foreseeable threat of injury to others. The injury must be physical but does not need to occur within the scope of employment.
The duty of the employer to conduct a reasonable pre-employment investigation depends upon the job. For example, an employer owes no such duty for a maintenance worker whose responsibilities required no exposure to the general public and limited contact with coworkers. Yet in Ponticas v. K.M.S. Invs., 331 N.W.2d 907 (Minn. 1983), an employer was held liable for hiring an apartment caretaker who entered an apartment and raped the tenant at knifepoint. Because a caretaker lives among the tenants and has a passkey for the individual apartments, the employer was liable for failing to conduct a reasonable investigation, which would have revealed the employee’s lies on his application about his references, criminal history, and employment record.
An employer does not have an affirmative duty to investigate criminal history (absent a statutory mandate), but an employer does have a duty to exercise reasonable care when hiring, based upon all of the circumstances.
Negligent Retention
An employer is liable for negligent retention when, during the course of employment, it becomes aware or should have become aware of problems with an employee that indicated unfitness, such as a dangerous disposition, and the employer fails to take reasonable action to protect a third party. As with negligent hiring, the injury need not arise from the scope of employment.
For example, in Yunker v. Honeywell, Inc., 496 N.W.2d 419 (Minn. Ct. App. 1993), the employer rehired an employee after the employee completed his imprisonment for murdering a coworker. After his rehire, the employee harassed and threatened another coworker at work and at home. The coworker sought help from her supervisor, but the employer did nothing. The employee killed the coworker less than two months later. The employer was held liable because given the employee’s history and the escalation of his behavior towards the coworker, it was foreseeable that he would act violently. In contrast, the employer in Kresko v. Rulli, 432 N.W.2d 764 (Minn. Ct. App. 1988), was not liable for negligent retention because it acted immediately upon the first reports of alleged sexual harassment.
Negligent Supervision
An employer is liable for negligent supervision when it fails to supervise the employment relationship sufficiently to prevent an employee’s foreseeable misconduct from causing harm to others. An employer must take reasonable precautions to prevent an employee’s objectively foreseeable violent behavior. Like negligent hiring, the harm must be physical, but unlike negligent hiring or retention, the misconduct must occur within the scope of employment.
For example, in L.M. v. Karlson, 646 N.W.2d 537 (Minn. Ct. App. 2002), the court allowed a claim of negligent supervision which alleged that a daycare facility negligently supervised an employee who molested several children during naptime and bathroom breaks. An employer has a duty to control its employees’ physical conduct while on the premises or while using the employer’s property.
The standards for these negligence causes of action are fairly narrow. However, as the above cases show, an employer is ultimately responsible for its employees, and thus should take any necessary precautions and actions when hiring, retaining, and supervising its employees.
If you have any questions or concerns about Minnesota employment law, contact the knowledgeable and experienced employment attorneys at Barna, Guzy & Steffen, Ltd.
Jennifer C. Moreau is an associate attorney in the Commercial Litigation and Employment Law department.