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Business/Economy

Can your employee’s big mouth pull you into a defamation lawsuit?

  • Author: Lynne Curry
    | The Workplace
  • Updated: September 3
  • Published September 3

Q: One of our employees, Cora, has a mouth. Those of us who work directly with her have learned how to take what she says, and some of our customers find her fun to talk with, but others take offense. Once they do, Cora gets her back up and blasts them. This happened last month. Cora apparently called the co-workers of a woman who made her mad and said insulting things about the woman and her children. Cora then sent out the same insults out on posts via Facebook and Twitter.

This morning, we got a letter from an attorney. We're being sued for defamation as Cora's posts got traced back to our company computers. We haven't been able to find an attorney who can help us, and don't know how much trouble we're in.

A: Employers can be held liable for what their employees do if the employees do it within the "scope" of their employment. For example, if an employee has an accident in a vehicle when driving for work, the accident victims can sue the employer.

Similarly, employers can be held liable for defamatory statements made by their employees if the comments are made "within the scope" of their job or the employer "endorses the conduct."

Two recent cases outline how courts rule. In Sade Garnett v. Remedi Seniorcare of Virginia, LLC, No. 17-1890 (June 11, 2018), the courts ruled that employers don't need to police every employee interaction, particularly ones made outside the scope of their employment.

In that case the employee, Sade Garnett, told a night supervisor at Remedi that she'd be on leave for surgery the next day. Her supervisor then told other employees Garnett was having surgery on her vagina because she had an STD. Garnett then sued her employer, and not her supervisor, for defamation.

According to the court, although the supervisor made the comments at work, Remedi wasn't liable because the supervisor wasn't under the employer's control, wasn't performing assigned work and wasn't acting in the employer's interest when he made the comments. The court ruling said that the supervisor's "gossiping to his co-workers" was outside his scope of his employment.

While that court noted it would be impossible for an employer to "police" its employee's speech, a court or jury might rule differently in your situation.

According to the ruling, "(l)iability will attach only if the employer (a) bears at least partial responsibility for the tortious conduct; or (b) has some ability to limit the likelihood that the employee would commit a tort."

In your situation, you know Cora "has a mouth" and yet you continue to employ her. That might prove relevant in assessing "the likelihood that the employee would commit a tort."

The other case, McLachlan v. Bell, came from the Ninth Circuit, the U.S. Federal court with appellate jurisdiction over Alaska. In "Mitigating Risk for Rogue Employee Speech," attorney Daniel Deacon of Conn Maciel Carey notes that in this case the "employees' alleged defamatory statements about a co-worker concerning matters related to his work on aeronautical engineer projects for NASA were deemed within the scope of employment. Ultimately, because the statements about the plaintiff took place in the workplace and were related to business activities, the court denied the defendants' motion for summary judgment and found that the employer could be held liable."

In short, you need to rein Cora in. Not only could her comments drag you into court — and remember that Sade Garnett sued her employer and not the supervisor who made the comments — but you apparently employ a woman who thinks it's OK to blast customers. How many has she cost you?

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