Do you plan to run a motor vehicle record (MVR) check on all your employee drivers this year? If not, you should. You can reduce your company’s risk profile by instituting annual or bi-annual MVR checks as part of a driver safety program.
Why you need a driver safety program
If your organization employs workers who operate vehicles as part of their job, you face a high risk that an employee will become involved in an accident. If an employee causes a motor vehicle accident while on the job and significant injuries result, the whole company could face liability.
This is why it is important to institute a driver safety program that not only reduces the chance of employee car accidents but also protects the company from liability if one does occur. Checking employees' motor vehicle records on a regular basis is particularly important because it greatly reduces the risk of a costly negligent entrustment lawsuit.
What is negligent entrustment?
Negligent entrustment refers to situations in which a court holds an employer responsible for an employee's actions due to negligence on the employer's part. The legal term for this liability is respondeat superior, Latin for "let the master answer." An example would be when an employee causes an accident while working and it can be proven that the company was negligent in allowing the employee to drive at that time.
Perhaps the employee was driving on a suspended license or had a history of reckless driving. An employer is expected to take all reasonable precautions to ensure that employees can safely carry out their jobs. This includes taking steps to ensure that unsafe drivers do not drive on behalf of the company.
With any employees on the road, it is essential to have an employee vehicle safety policy no matter how large or small your organization is. The policy should outline and define what a safe driver is, assign appropriate consequences for moving violations, and designate the frequency of MVR checks.
How do MVR checks protect against negligent entrustment and respondeat superior?
Do not underestimate the value of running MVR checks. Because driving records can change constantly, MVR checks are necessary to provide insight into employees’ driving records and to deliver predictive driving data. This data can be used to assess employees' risk profiles and reveal which employees need driver safety training. Making sure your employees are safe, responsible drivers is your corporate responsibility.
Instituting annual or bi-annual MVR checks can prevent negligent entrustment lawsuits because this allows you to demonstrate steps taken to ensure safety of employee drivers. If a motor vehicle record identifies an employee as a high-risk driver, you then have the ability to take proactive action by providing driver safety training or by parting ways preemptively.
If an employee causes an accident while driving for the company, the first thing the victim's attorneys will do is pull that driver's motor vehicle records. If they find warning signs on that record that your company ignored by not pulling MVRs regularly, then they will build a case for negligent entrustment.
Using employee motor vehicle records to promote driver safety
An MVR check can reveal such valuable information as traffic violations, vehicular crimes, citations, DUI convictions, driving points, unanswered summonses, and lapses in insurance. Past behavior tends to predict future behavior, allowing you to establish a risk profile for each employee.
Every company, in its driver safety policy, should define parameters for what is and isn’t acceptable in an employee motor vehicle record. Defining MVR parameters reduces risk, allowing you to either retrain or terminate an employee that poses an unacceptably high risk.
One challenge, though, is that different states use different points systems to assess driver safety when moving violations occur. To use MVR checks effectively, you need to understand these points systems first.
How to interpret point systems for driver safety
Several factors are involved in generating the MVR points system for moving violations such as terrain, traffic, and population density. Because the MVR point system is established by each state, comparing the records of two different employees from two different states can be a challenge.
For example, a 2-point violation in one state might equate to a 1-point violation in another. Some states display even greater disparities. In the chart below, you can see that driving without a license generates 10 points in Texas but only 2 points in California. Some states, such as Kansas, do not use a point system at all. Consequently, it’s essential to create a points equalization scale that takes into account differences in each state’s system.
Adding points equalization to your driver safety program
If your organization has employees all over the United States, you already know that one-size-fits-all policies create problems. Because motor vehicle points systems vary by state, treating all point totals the same way will penalize some drivers unfairly and may let riskier drivers slide.
Implementing a points equalization system is vital to giving you an accurate picture of your company’s risk level. While it’s best to implement a points equalization system when designing your driver safety program, you can also incorporate points equalization into your existing program. First, create your own point system that is based on standardized criteria for determining high-risk drivers. Then create a scale that allows you to accurately and automatically translate each state’s points system into your own.
Motor vehicle records and employee auto insurance
As you interpret each employee’s MVR report, it’s important to remember that points for moving violations can increase auto insurance premiums. Driving history is one of the biggest factors in calculating these premiums. Insurers also reward safe drivers with discounts. Mobile employees with moving violations may reduce their insurance coverage to offset their personal costs for insurance. In this case your organization’s risk is compounded by at-risk drivers.
For this reason, it’s imperative to verify that employees are maintaining sufficient insurance coverage, especially after an MVR check that reveals a high-risk driver. If an employee reduces coverage to insufficient levels, your organization could be held liable for an accident involving that employee due to respondeat superior. To prevent this, require a minimum level of insurance coverage that far exceeds state minimums, and verify coverage on a bi-annual basis, since most premiums renew every six months.
Protect your reputation with a driver safety program
When a company gets held responsible for the reckless actions of employees, it hurts the company's reputation. Employers have deeper pockets than employees, so it makes sense that car accident victims and their attorneys will apply the respondeat superior principle.
That’s why it is vital to stay proactive and use data from MVR checks to provide corrective activities for employees whose risk profiles fall outside company parameters. A negligent entrustment suit can cost your organization more than just time and money – it can also tarnish your reputation for years to come.
Check out our guide to mobile employee risk to learn how to create a comprehensive driver safety program that includes MVR checks, points equalization, insurance verification, and driver safety training.