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What Is Vicarious Liability

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BBC203 Business Law

Ass. No. 2 Essay Q.1

Student No. 201212185

What is vicarious liability? Analyse the differences between contractors and employees and explain why these differences are important, in your answer you should consider the multi-factor test. Vicarious liability is a part of Tort law, which can be defined as the imposition of liability on a third party, such as an organisation or employer for the wrong actions, non-actions or negligence of an employee performing their employment duties on behalf of the organisation or employer. It is mostly a component of common law, set by a doctrine of judicial precedents but also involves civil law as vicarious liability falls under concurrent powers with its legislative power of the Parliament, shared between both federal and the states jurisdiction to pass statutes, legislations and Acts (Pendleton & Vickery, 2009). Vicarious liability can only be imposed with a standard of proof, ‘the balance of probabilities’, based on a multi-factor test rule, which includes the usual tests of negligence by the tortfeasor’s conduct, with a dispute process based on proving a ‘balance of probabilities’. To understand vicarious liability it is important to first outline the legal responsibility of an employer for the conduct of employee’s. Employers are responsible to actively contrive precautionary measure, such as policies, procedures and contractual boundaries to minimise the risk of an employee committing a wrongful act while within the course of employment (Australian Human Rights Commission). By emplacing contractual boundaries, policies and procedures an employer is seen to be taking reasonable steps to reduce their liability for the conduct of employees, by outlining the employee’s employment obligations. Policies and procedures are proposed principles, rules and guidelines that outline the course of action, which

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