Am I Responsible for an Accident in a Company Car?

Who is Liable for an Employee’s Accident in a Company Car?

The responsible party for an accident that occurs while an employee is driving a company car will depend on the specifics of the situation. In general, employers will be liable because of a legal concept known as vicarious liability. Under vicarious liability, an employer can be held responsible for the actions of their employees given that the employee is acting within the scope of their job. The purpose of vicarious liability is to ensure that employers and companies are behaving appropriately and effectively supervising their employees and subordinates. Given this definition, if an employee is driving a company vehicle for the purpose of their employment and gets into an accident, the employer is likely on the hook for covering associated costs. The following are examples of situations where the employer may have to take responsibility for the employee’s accident.

• The accident took place during business hours
• The employee was making a delivery for work
• The employee was transporting a coworker or superior
• The employee’s job is to drive, such as a bus or truck driver
• The employee was running an errand related to work
• The employee was traveling for work

When Can an Employee Be Found Liable?

Vicarious liability is not an absolute. Depending on the specific circumstances of the situation, the employee may be responsible for covering the costs incurred from the accident even if they were driving a company car.

If the employee is given a company car to use and take home it is probably their primary mode of transportation. The increased amount of time spent operating the vehicle means that there is an increased risk of getting into an accident while driving it. If the employee is driving the car outside of business hours and gets into an accident they are likely going to bear the burden of liability. The only exception would be if they were completing a requested work task outside of business hours.

An employee may also be responsible for the accident during business hours. If they got into an accident during the work day while performing a non-work related task or running a personal errand, they can be liable for the damages involved. Additionally, if they got into an accident while committing a crime the employer will not have to cover costs.