Employee liability - how far?
Discussion
I've just started a new job and had the usual HR induction and form filling.
One of the forms is a permission to ‘deduct from pay’. I think the intention is to cover my employer in the event I leave and have taken too many holidays or I intentional damage something etc.
However, the last paragraph asks me to accept responsibility for any loss caused to the company by my actions and I give permission for my employer to peruse the claim for loss through the civil courts agianst.
Now I've been an IT contractor before so this is normal against the Umbrella company and that company is required to have PI insurance but against a full time employee. My object of become a full time employee as to have better employment rights.
To me it appears this clause make me liable and place my personnel assets at risk. Even if I started a small business I’d use a limited company and have greater protection for my personal assets.
Is this legally enforceable and Am I been asked to stick my home and others assets on the line here?
It appears a bet with a massive downside and no upside.
One of the forms is a permission to ‘deduct from pay’. I think the intention is to cover my employer in the event I leave and have taken too many holidays or I intentional damage something etc.
However, the last paragraph asks me to accept responsibility for any loss caused to the company by my actions and I give permission for my employer to peruse the claim for loss through the civil courts agianst.
Now I've been an IT contractor before so this is normal against the Umbrella company and that company is required to have PI insurance but against a full time employee. My object of become a full time employee as to have better employment rights.
To me it appears this clause make me liable and place my personnel assets at risk. Even if I started a small business I’d use a limited company and have greater protection for my personal assets.
Is this legally enforceable and Am I been asked to stick my home and others assets on the line here?
It appears a bet with a massive downside and no upside.
Don't sign it.
The employer should have in place sufficient safeguards and checks on the work its employees carry out.
Your employer should be insured against actions taken against poor work carried out by staff. It is very, very difficult for employees to obtain such insurance.
There is one legal case from about five years ago where an employee was successfully sued, not by his employer, but by a customer of a company he once worked for. The details of the case were quite unusual in that the customer was unable to sue the company for damages as it had gone out of business by the time the case went to court. The court gave the claimant permission to claim against the ex-employee who had carried out the poor work. The claimant won!
The employer should have in place sufficient safeguards and checks on the work its employees carry out.
Your employer should be insured against actions taken against poor work carried out by staff. It is very, very difficult for employees to obtain such insurance.
There is one legal case from about five years ago where an employee was successfully sued, not by his employer, but by a customer of a company he once worked for. The details of the case were quite unusual in that the customer was unable to sue the company for damages as it had gone out of business by the time the case went to court. The court gave the claimant permission to claim against the ex-employee who had carried out the poor work. The claimant won!
I'm with Eric - I wouldn't sign.
A good employer should accept, manage, and insure against the risk of their employees messing up.
They'll probably already have the charmingly named "Dead Peasants Insurance" to cover their inconvenience if you snuff it, so they should cover this too.
A good employer should accept, manage, and insure against the risk of their employees messing up.
They'll probably already have the charmingly named "Dead Peasants Insurance" to cover their inconvenience if you snuff it, so they should cover this too.
So I would be liable.
I've been told in so many words that if I don't sign then bye bye.
I've never come across this in any other management position before that I've held. Beginning to have some doubts about the whole thing.
Really pissed about this as I turned down 2 others offers in the same week to take this role.
I've been told in so many words that if I don't sign then bye bye.
I've never come across this in any other management position before that I've held. Beginning to have some doubts about the whole thing.
Really pissed about this as I turned down 2 others offers in the same week to take this role.
You would be liable in law, yes. But would they actually sue ? Not sure anyone has, at least in the 'Smoke. You don't have a huge fortune to pay out, and they would have to near admit negligence in their management of you, in order to allow you to make such a blunder, and it would be David vs. Goliath, none of which is good PR.
These clauses are becoming increasingly prevalent, though. Very much post-Enron Americanisms. If you have other offers that you could recover, I'd (politely) tell them to stuff it.
These clauses are becoming increasingly prevalent, though. Very much post-Enron Americanisms. If you have other offers that you could recover, I'd (politely) tell them to stuff it.
Three things strike me
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
johnbear said:
Three things strike me
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
Not a lawyer, but as I understand it:
1. No amount of legal paperwork can excuse negligence - you are always liable for that, so I presume it need not be listed. That is why you can happily sign most disclaimers for e.g. adventure sports, even if they have a clause to excuse their own negligence.
2. Yes, expect bankruptcy and little mercy if they do sue. Check what you sign. And then pray they don't sue.
3. Er, Eek! But I don't know how "Eek!"
and, as we are discussing nasty consequences...
4. Don't ever do business with American firms, not even via third parties. You can now be fast-track extradited under anti-terrorism laws for almost anything, though they get particularly pissed if you make more money than them.
johnbear said:
Three things strike me
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
I don't know anything about this really, but reading what you wrote, you would be liable for a loss even if it was as a result of inaction. I guess this could occur whenever the company involved felt that you had caused them loss. It sounds like you need to be the big bosses mate and fast. Are you ready to lick some serious butt?
TBH, it hardly sounds like a warm welcome.
grumbledoak said:
johnbear said:
Three things strike me
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
1. The clause doesn't make reference to neglience etc on my part just 'any loss' the company incurs.
2. If it ever went to court, it's the legal costs of defending an action that concern me -it could be more than the losses incurred.
3. The brands I've just taken control of are already lossing money so would I be responsible for losses from this point on?
Not a lawyer, but as I understand it:
1. No amount of legal paperwork can excuse negligence - you are always liable for that, so I presume it need not be listed. That is why you can happily sign most disclaimers for e.g. adventure sports, even if they have a clause to excuse their own negligence.
2. Yes, expect bankruptcy and little mercy if they do sue. Check what you sign. And then pray they don't sue.
3. Er, Eek! But I don't know how "Eek!"
and, as we are discussing nasty consequences...
4. Don't ever do business with American firms, not even via third parties. You can now be fast-track extradited under anti-terrorism laws for almost anything, though they get particularly pissed if you make more money than them.
Fully understand neglience on my part and have always acted as a responsible employee and always would. However when I am contracting I am covered at two levels - Limited Company and Professional Idemenity.
As an employee I don't expect to be risking my home to get a job. If I wanted to take that much risk I'd start my own business and then I could protect myself with a company etc and balance the risk against the rewards.
As an employee the benefits are more or less fixed but in this case the risks are unlimited and very vague i.e 'Any Loss'and recovery through the civil courts!
The other thing that concerns me is the cost of defending an action that might be untrue - it could easily run into the tens of thousands. It is privately owned company and I've no idea of what the owner is like.
Edited by johnbear on Sunday 21st January 19:02
Absolutely.
Employees should never be put in a "riskier" position than their masters (i.e employers).
This is especially true in circumtsances where the employee has no way in which he can indemnify himself against future, totally unforseeable claims. The employers should be able to indemnify themselves by means of insurance, so why should they try to double their indemnity by making the employee carry the risk as well.
It's just not on.
Employees should never be put in a "riskier" position than their masters (i.e employers).
This is especially true in circumtsances where the employee has no way in which he can indemnify himself against future, totally unforseeable claims. The employers should be able to indemnify themselves by means of insurance, so why should they try to double their indemnity by making the employee carry the risk as well.
It's just not on.
Edited by Eric Mc on Sunday 21st January 22:49
Not sure what more there is to say:
They are asking you to sign a contract that would make you liable for far more than the ordinary "law of the land" would. If you choose to sign there is a small chance that they would sue, and in that circumstance you could be open to costs, which would hurt you badly.
I would ask to get the clause changed.
They are asking you to sign a contract that would make you liable for far more than the ordinary "law of the land" would. If you choose to sign there is a small chance that they would sue, and in that circumstance you could be open to costs, which would hurt you badly.
I would ask to get the clause changed.
Eric Mc said:
Absolutely.
Employees should never be put in a "riskier" position than their masters (i.e employers).
This is especially true in circumtsances where the employee has no way in which he can indemnify himself against future, totally unforseeable claims. The employers should be able to indemnify themselves by means of insurance, so why should they try to double their indemnity by making the employee carry the risk as well.
It's just not on.
Employees should never be put in a "riskier" position than their masters (i.e employers).
This is especially true in circumtsances where the employee has no way in which he can indemnify himself against future, totally unforseeable claims. The employers should be able to indemnify themselves by means of insurance, so why should they try to double their indemnity by making the employee carry the risk as well.
It's just not on.
Edited by Eric Mc on Sunday 21st January 22:49
Completely agreed.
I dont think a professional has written this contract as it in my guess that in practice it is unenforcable. Whilst there can be a legitimate clasue whereby the employer is allowed to deduct holiday allowance overpaid and any monies lent etc, asking the employee to cover 'any loss' is fundamentally unfair and probably so vague is unenforcable.
For example, lets say Client X goes bust on a Friday owing your company £100,000. Lets say your company sues you for £100,000 as you should have sent the invoice out two days earlier...
You could go on and on through a myriad of permiatations. I think it would be unenforcable on the basis that it is too vague, and also on the basis that it is fundamentally unfair in that you are supposedly taking all the risk for all the possibilities yet you are considering against this against a disproportionate amount of the benefits. There is also even possible protection that you signed the contract under duress - thus making it unenforcable too.
justinp1 said:
I dont think a professional has written this contract as it in my guess that in practice it is unenforcable.
Employment contracts often have clauses in them saying that you can't work for a competitor for x months after leaving, but that's totally unenforceable.
I had to sign a clause when I joined my last company agreeing that I'd pay the insurance excess (£1000 - & bear in mind this was 20 yrs ago, so like maybe £4000 now) if I crashed the company car. So that's great - the employer reduces its insurance premium by having a £1000 excess and then passes the excess onto its employees! I was told if you don't sign them you don't have a job. I signed but noted 'under duress'.
I spoke to an employment law solicitor and she thought it was hilarious that I could be expected to pay the excess while driving on company business, although it got a little bit more vague if I was using the car off-duty. As it happened, in the 17 yrs I was there I never had an accident!
deva link said:
justinp1 said:
I dont think a professional has written this contract as it in my guess that in practice it is unenforcable.
Employment contracts often have clauses in them saying that you can't work for a competitor for x months after leaving, but that's totally unenforceable.
I had to sign a clause when I joined my last company agreeing that I'd pay the insurance excess (£1000 - & bear in mind this was 20 yrs ago, so like maybe £4000 now) if I crashed the company car. So that's great - the employer reduces its insurance premium by having a £1000 excess and then passes the excess onto its employees! I was told if you don't sign them you don't have a job. I signed but noted 'under duress'.
I spoke to an employment law solicitor and she thought it was hilarious that I could be expected to pay the excess while driving on company business, although it got a little bit more vague if I was using the car off-duty. As it happened, in the 17 yrs I was there I never had an accident!
Agreed. Part of the contract of employment can prevent you after you leave, but it must be for good reason and must be specific. The reason why most of these clauses are unenforcable as they are unreasonable as they are so vague, like:
"The employee must not work for a UK IT company for the next 10 years" is an extreme example but shows the 3 vague or unreasonable factors.
I completely agree with your solicitor about your clause too, silly and unenforcable simply because I guess that having a company car may not have been an option for you and thus you didnt have the choice to opt out. Now, if they provided you with a company car and *if* you wanted it for personal use *as well* as an option they may have something more enforcable if they asked you to pay the excess if you were using the car for pleasure because of course there as at that point there is no business use, and you are choosing to use the car for pleasure under your own free will as an option after agreeing to the consequences.
Absolute p1ss take.
I negotiate big IT and outourcing contracts, and increasingly the big players are trying to exclude liability for theft etc by their employees. THEY'RE YOUR EMPLOYEES YOU WANK3ERS.
Push back. Hard.
Even if you accepted liability for negligence, this clause is very very wide and vague and goes much further than that.
It's unenforceable at law, but what utter tossers.
I negotiate big IT and outourcing contracts, and increasingly the big players are trying to exclude liability for theft etc by their employees. THEY'RE YOUR EMPLOYEES YOU WANK3ERS.
Push back. Hard.
Even if you accepted liability for negligence, this clause is very very wide and vague and goes much further than that.
It's unenforceable at law, but what utter tossers.
Edited by Vesuvius 996 on Monday 22 January 17:15
It's a difficult one. On the one hand the job is very interesting and close to home, but the salary is OK ish and the working conditions are below average. My new manager seems a genuine hardworking person and but the contract terms seem a little draconian - statutory sick pay only, no health care, no death in service and limited holidays (but I have been assured verbally if I turn the brand around then that won't be a problem). If the agreement on salary is not met then I can always move on.
But the sticking point will be the 'any loss' clause. This is something I am not prepared to sign; it's too risky purely on the legal costs grounds, never mind any loss incurred.
But the sticking point will be the 'any loss' clause. This is something I am not prepared to sign; it's too risky purely on the legal costs grounds, never mind any loss incurred.
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