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I Understand

Vicarious Liability: An Overview

September 2025

By Mark Toh Jing Soon 

(a) Introduction

“Why am I being sued when my employee is the one at fault?” 

This question often arises in the context of vicarious liability, a legal doctrine where the responsibility for a tort committed by a tortfeasor is transferred to another person, most commonly the tortfeasor’s employer. For example, if an employee (the tortfeasor), while performing their job, negligently injures someone, the injured party may sue the employer rather than the tortfeasor.

This may seem unfair at first glance because it appears to contradict the general legal principle that a person is only responsible for his own actions. However, the rationale for vicarious liability is rooted in the idea that those who take the benefit of the tortfeasor should also shoulder the burden when things go wrong.

(b) Tests for Vicarious Liability

Courts have developed a two-stage test to determine whether vicarious liability should apply: 

1. The Relationship Test 

This test concerns establishing whether the relationship between the wrongdoer and employer is sufficiently close to justify holding the employer liable. Traditionally, liability attaches only where there is an “employer-employee” relationship, not where the wrongdoer is an independent contractor. However, modern cases, particularly in the UK and applied in Malaysia, have expanded this test to include relationships “akin to employment”. For example:

  • In Cox v Ministry of Justice [2016] AC 660, the UK Supreme Court held the prison service liable for the negligence of a prisoner working in a kitchen. 
  • In Armes v Nottinghamshire County Council [2017] UKSC 60, foster parents were found to have a relationship akin to employment with the local council. As such, the local council could be liable for the abuse inflicted by the foster parents on a foster child. 

This led to much confusion, as it became increasingly difficult to distinguish between employees and independent contractors, resulting in employers being held liable for individuals who appear to be independent contractors. This issue was clarified in Various Claimants v Barclays Bank plc [2020] UKSC 13, where the UK Supreme Court reaffirmed the longstanding principle that employers are not liable for the acts of independent contractors. While Barclays has not been cited in Malaysian judgments, its impact here is likely limited, as Malaysian cases such as Dr Kok Choong Seng & Anor v Soo Cheng Lin [2018] 1 MLJ 385 and Dr Hari Krishnan & Anor v Megat Noor Ishak bin Megat Ibrahim & Anor and Another Appeal [2018] 3 MLJ 281 have already upheld the distinction between employees and independent contractors, and confirmed that employers are not liable for the acts of independent contractors.

2. Close Connection Test 

This test concerns whether the wrongful act is sufficiently connected to the employment to make it fair to hold the employer liable. The classic case is Lister v Hesley Hall [2001] UKHL 22, which held that because the abuse committed by a warden was so closely connected with his duties, the boarding school could be held liable for his actions. 

In Malaysia, the Federal Court applied this test in GMP Kaisar Security (M) Sdn Bhd v Mohamad Amirul Amin [2023] MLJU 2543. In that case, a security company was held liable after its bodyguard, Jaafar, shot and killed a client. The Court found that the employer had created the risk by employing Jaafar for a high-risk role and providing him with the gun. Ultimately, the Court found that there was a close connection between his duties and the harm caused.

(c) Conclusion

Vicarious liability remains a dynamic area of law, shaped by societal changes such as the rise of the gig economy. Courts continue to grapple with where to draw the line between employees and independent contractors, and how far to extend liability, especially in cases involving intentional acts like harassment or assault.

Practical Takeaways for Employers

  • Review contracts and practices: Ensure clarity in distinguishing employees and independent contractors.
  • Implement proper risk management: Vet employees carefully, particularly for roles involving high-risk activities.

Vicarious liability may seem like a legal technicality, but its implications are very real. Ultimately, employers must remain vigilant in managing the risks associated with those who act on their behalf.

This material is for general information only and is not intended to provide legal advice. If you have any queries regarding the above, please feel free to contact us at insights@chooi.com.my.