When might a worker be personally liable for property damage caused during their employment? Mr Dowling, a truck driver from Townsville, found out the hard way when he was ordered to pay over $545,000 in damages to Blenners Transport for crashing one of their trucks loaded with fruit in 2019.
A labour hire company employed Mr Dowling to drive Blenners trucks from Tully to Townsville. Whilst driving a B-double truck loaded with fresh fruit, he received a phone call that failed to connect to his Bluetooth earpiece. Mr Dowling then attempted to answer the phone manually and diverted his eyes for one to two seconds from the road to look down at the phone. In doing so, the truck veered off the road and rolled down a steep embankment. The truck was severely damaged, the load of fruit was destroyed, and Mr Dowling suffered very serious injuries. However, this wasn’t the end of his problems.
Blenners Transport sought to recover the cost of the truck and the destroyed fruit from Mr Dowling. It was found that Mr Dowling had a duty to keep the truck and fruit safe under the laws of bailment and that he breached that duty by illegally using his mobile device, failing to pay due care and attention, and losing control of the truck causing it to crash. As a result, he was ordered to pay for the damages to Blenners.
What does this mean for employees?
Employees are often entrusted with expensive equipment belonging to the employer. Most employers will have policies in place about employees conduct, operating equipment and what amounts to unacceptable behaviour.
If there has been serious or wilful misconduct, in breach of workplace policies that results in equipment being damaged or destroyed, the employee might find themselves personally liable. Serious or wilful misconduct is deliberate behaviour that is inconsistent with their employment contract.
It is relatively uncommon for employers and third parties to pursue workers for the cost of property damage caused during the course of employment. This is generally because there is insurance attached to the damaged item or the employee is unlikely to be able to satisfy a successful judgment against them. However, it doesn’t mean that employers (or their insurers) can’t or won’t bring claims for loss against their employees.
In the New South Wales case of Bolton Gems v Grigoire (1995) an employed sales representative of a gem wholesaler was required to transport a bag of gems around to various jewellers. She was trained and instructed not to leave this bag unattended. Despite this she left the gems unattended in her vehicle and, on return to her car, she discovered the gems had been stolen. It is worth noting in that case that the gem insurance policy had a coverage exclusion if left unattended in a vehicle. Accordingly, the employer successfully sued the worker for the cost of the stolen gems. The employer alleged that she had breached her employment conditions and disobeyed the policy that stipulated that the gems not be left unattended.
In the earlier Queensland case of Boral Resources (Queensland) Pty Ltd v Pyke (1992), a majority in the Court of Appeal found that an intoxicated and fatigued employee who drove and crashed a heavy vehicle belonging to his employer had engaged in serious and wilful misconduct, disentitling the employee from the protection in section 66 of the Insurance Contracts Act 1984 (Cth). As a result, the insurer, who had indemnified the employer in relation to the loss of the heavy vehicle, was entitled to institute proceedings by subrogation to recover the loss from the employee.
Is there any protection for employees?
The above cases raise the question of whether workers in Queensland have any personal protections from these types of claims.
In the Queensland private sector, the Fair Work Act 2009 (Cth) applies to limit the type of deductions employers can make from an employee’s wages. In basic summary, an employer can only deduct money if:
- the employer and employee agree to the deduction in writing and the deduction is principally for the employee’s benefit; or
- the deduction is allowed by a law, a court order, or by the Fair Work Commission, or
- the deduction is allowed under the applicable industrial award or registered agreement AND the employee also agrees to it.
Queensland has not enacted legislation to protect employees from being liable for any negligent work performance. In some states, legislation has been enacted to prevent an employee from being forced to compensate an employer who is vicariously liable for a tortious act committed by the employee during the course of their employment. However, this legislation does not extend to serious or wilful misconduct.
What can employees do to protect themselves?
If you are an employee who is likely to be working with expensive equipment, having your employment contract checked by a lawyer would be worthwhile before signing it. Employment lawyers can assist in omitting or modifying onerous clauses where agreement can be reached and to warn about the potential consequences of those remaining terms.
In practice, the best thing an employee can do to protect themselves is to follow their employer’s policies and procedures and to otherwise act lawfully. If you are not in breach of these and have not engaged in what amounts to serious and wilful misconduct, an employer or their insurer should have no claim against you.
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