The Dallas Cowboys organization has been named a defendant in a lawsuit from a car accident involving its star running back, Ezekiel Elliott. Now Elliott's employer may be liable for significant damages due to the legal concept of negligent entrustment.
What is negligent entrustment?
Negligent entrustment means that an employer is held responsible for the actions of an employee because the employer negligently entrusted work responsibilities or company property to the employee. In the case of Ezekiel Elliott, it appears that the Cowboys owned the car he was driving.
Here's what NBC Sports reported:
the Cowboys are named [in the suit] because the plaintiff alleges that the Cowboys owned the vehicle that Elliott was driving, and that they negligently entrusted the car to him when the Cowboys knew or should have known that he’s a negligent or reckless driver.
In other words, Elliott's employer should have known that this particular employee had a spotty driving record and therefore should not have entrusted him with a vehicle owned by the team. If the plaintiff's attorneys can establish these claims, the Cowboys may find themselves paying damages or opting to settle out of court.
Can an employer really be forced to pay for an employee's actions?
The simple answer is, yes, an employer can be held legally answerable for an employee's actions. The charge of negligent entrustment is based on a legal doctrine called respondeat superior, Latin for "let the master answer."
This doctrine has significant implications for any organization that either provides company cars as a perk or requires employees to operate personal vehicles as part of their job responsibilities. In the case of the Cowboys, it's a question of vehicle ownership, since Elliott was not conducting team business when the accident occurred.
But respondeat superior can also apply to personal vehicles in certain circumstances. Let's explore the specific risks that come with both company vehicles and personal vehicles operated on behalf of the company.
Negligent entrustment and company cars
When it comes to managing a fleet of company vehicles, a car accident outside of work hours can be just as damaging as a car accident on the job. When an employer provides a company car as a perk or as a work requirement, it is assumed that each employee issued a vehicle has been thoroughly vetted as a driver.
If that employee causes an accident during a personal errand, the company can still be held liable if there's evidence that they knew or should have known that the employee could not be entrusted with a vehicle. The employer is responsible to check motor vehicle records for each employee issued a car and to maintain a system that reduces the risk of employee-involved car accidents.
Negligent entrustment and personal vehicles
In the case of an employer that does not issue a company car but requires certain employees to operate a vehicle on the job, the concept of respondeat superior can still apply. In this case, an accident during a personal errand would be excluded, but not an accident occurring while carrying out work responsibilities.
As with drivers issued a company car, each employee required to drive for work should have been sufficiently vetted before being entrusted with those responsibilities. Otherwise, the employer could face a negligent entrustment lawsuit.
Another area of risk comes from employee auto insurance coverage. With a company car, the company maintains the auto insurance coverage. With a personal vehicle, that's the employee's responsibility. The employer, however, could face liability if an under-insured employee gets in an accident while carrying out work responsibilities.
How to prevent negligent entrustment of a vehicle
The Dallas Cowboys have deep pockets, and the Ezekiel Elliott lawsuit may be more of a PR problem for the team than a financial one. But for most organizations it is absolutely crucial to avoid ever being named in a lawsuit against an employee. Here are some practical steps a company can take to avoid negligent entrustment of a vehicle:
1. Perform motor vehicle record checks annually (or more frequently).
Any employee who receives a company car or drives a personal vehicle on behalf of the company should be routinely checked for traffic violations. Any violation should be addressed by the company via an action plan such as a driver safety course.
2. Create and enforce a company-wide vehicle safety plan.
In addition to promoting safe driving practices, the company should establish risk profiles for all employees. Each driver should be assigned a risk score based on the information in their MVR reports. Should that risk score exceed an acceptable threshold, interventions ranging from a safety course to revocation of a company vehicle to termination should be applied.
3. Set and enforce a minimum auto insurance coverage.
Employees should be covered by a 250/500/100 auto insurance plan to ensure that the company will not be exposed by a car accident. It's not enough to make this a requirement, though. Someone in the organization should also verify coverage with the insurer every six months to catch any lapses.
Be proactive and avoid respondeat superior
The key to protecting a company from respondeat superior and negligent entrustment is simply to be proactive. If the Dallas Cowboys indeed owned the car Ezekiel Elliott was driving, they could have avoided any liability for the situation by refusing to let him drive a company car.
Once an accident occurs, it's all a defensive game. But every employer has the ability to be proactive and go on the offense before an incident ever occurs. To learn more about how to protect your company read our ultimate guide to mobile employee risk.