In good news for employers, the Michigan Supreme Court recently ruled that employers are no longer under the Michigan Civil Rights Act (MCRA) strictly liable for the intentional torts committed by supervisors. In Hamed v. Wayne County Sherriff’s Dep’t, the Court overruled a prior decision, Champion v Nationwide Security Inc. In order to better understand the Court’s ruling, the Champion case need first be discussed.
In Champion, the Michigan Supreme Court ruled that under the MCRA an employer could be held liable for the intentional torts of its supervisor for instances of sexual harassment. The Champion Court held that employers were liable “where the supervisor accomplishes [a] rape through the exercise of his supervisory power over the victim.” In the Champion case, a supervisor used his influence and authority over a lower employee to rape her. The Champion court ruled that the forseeability of the action was not relevant to the employer’s liability.
The Hamed Court overruled the Champion decision, which arose under similar circumstances. The Court’s ruling focused on the fact that employers could not be held liable for the intentional torts of its employees (including supervisors) that were not foreseeable to the employer.
The Michigan Supreme Court stated:
The general rule that an employer is not liable for acts of its employee outside the scope of its business, however, does not preclude vicarious liability in every instance. This Court has consistently recognized that an employer can be held liable for its employee’s conduct if “the employer ‘knew or should have known of [the] employee’s propensities and criminal record’” before that employee committed an intentional tort. This inquiry involves an analysis of whether an employer had (1) actual or constructive knowledge of prior similar conduct and (2) actual or constructive knowledge of the employee’s propensity to act in accordance with that conduct.
Although, employers are no longer liable for the unforeseeable torts of their employees under the MCRA, employers must still exercise care in hiring employees. The Court noted that employers might still be liable for the intentional torts of its employees (as well as for negligent hiring or negligent supervision) if the torts were foreseeable.
