Earlier in April, the Supreme Court determined that Barclays Bank plc (“Barclays”) was not vicariously liable in respect of the sexual assaults allegedly committed by the late Dr Gordon Bates (“Bates”) during various employment-related medical examinations which Bates carried out for Barclays between 1964 and c.1984.
Facts
Bates was a medical practitioner based in Newcastle. He had a ‘portfolio of work’, which included working as an employee in local hospitals, carrying out medical examinations for emigration purposes and doing miscellaneous work for various insurance companies and government departments. He also carried out medical assessments and examinations for employees and prospective employees of Barclays (to show such individuals were medically fit for work and could be insured at ordinary rates for the purposes of the bank’s pension scheme etc).
Barclays would arrange such examinations with Bates on the individual’s behalf and provided him with a pro forma medical report to be completed following the appointment. Bates would carry out the examination and then complete and issue a report to Barclays. Barclays paid Bates a fee for each report. He was not paid a retainer by Barclays, nor did he have to complete a specific number of reports on their behalf.
It is alleged that during such examinations, Bates sexually assaulted each of the 126 claimants in the group action. After Bates died in 2009, the group sought damages from Barclays, arguing that Barclays was vicariously liable for the assaults allegedly carried out by Bates.
Legal Background
Litigation on this matter first began in 2015, with a group litigation order being made in 2016. In July 2017, the High Court of England and Wales held that Barclays was vicariously liable in respect of Bates’ actions and in July 2018 the Court of Appeal dismissed Barclays’ appeal. Barclays then appealed to the Supreme Court.
Supreme Court Judgment
For one entity to be vicariously liable for the wrongdoing of another, two things must be shown:
- there must be a relationship between the two entities which makes it proper for the law to make one pay for the fault of the other; and
- there must be a sufficient connection between that relationship and the wrongdoing carried out. The Barclays case concerned the first point – the relationship between the two entities.
Historically, other than things like agency and partnership, the one relationship which could give rise to vicarious liability was that of an employee/employer, however this has been broadened by various recent cases which – it was argued by the claimants – have given rise to a ‘more nuanced approach’ in which a range of factors are to be considered in order to determine whether it is ‘fair, just and reasonable’ to impose vicarious liability in the circumstances of a particular case.
Barclays’ argument, on the other hand, was simple – they submitted that as Bates was an independent contractor and not an employee of Barclays, Barclays could not be held vicariously liable for his wrongdoing.
The Supreme Court considered the facts of the various recent cases in detail and came to the conclusion that while such cases did make it clear that an entity can potentially be vicariously liable for the actions of someone who is not their employee, this is only where the relationship between them is sufficiently ‘akin or analogous to employment’. There remains a clear distinction between circumstances where there is a relationship of employment (or a relationship which is akin or analogous to employment) and circumstances where there is a relationship with an independent contractor.
Bates, the court decided, was an independent contractor. His position was compared by the court to that of the various other contractors who would have provided services to Barclays from time to time, such as the persons engaged to clean its windows and the auditors hired to audit its books.
Accordingly Barclays could not be vicariously liable for any wrongdoing by Bates which may be proved to have occurred in the course of the examinations he carried out for Barclays.
Statutory definition of a ‘Worker’
It is worth mentioning that the Supreme Court did, as an aside to the Barclays case, note that statutory employment law recognises two different types of ‘worker’, being (a) those who work under a contract of employment and (b) those who work under a contract ‘whereby the individual undertakes to do or perform personally any work or services for another party to the contract whose status is not by virtue of the contract that of a client or customer of any profession or business undertaking carried on by the individual’ (Section 230(3), Employment Rights Act 1996). Legally, limb (b) workers enjoy some of the employment rights provided to limb (a) workers, but not all of them.
The Supreme Court noted that it could potentially be helpful to consider the wording of limb (b) above when trying to determine whether an individual was a true independent contractor or someone who had a relationship which was ‘akin or analogous to employment’, but also noted that it would be a step too far to align the common law concept of vicarious liability (developed for one set of reasons) with the statutory concept of a worker (which was developed for very different reasons).
This article was written for Navigator by Morag Waller, Senior Legal Adviser with our parent company Vialex. If you would like any further advice in respect of this case or on employment matters generally, please get in touch with Alan Sutherland.