Depending on the type of work you do, accidents are bound to happen. Even in a fairly benign office setting, there are many hazards that can befall employees, including injury from lifting things, exposure to harmful fumes and falling on slippery surfaces.

However, what exactly are you, the employer, liable for in the event of an accident, and what are you exempted from? With the passage of the Occupational Safety and Health Act in the 1970s, the federal government put laws into place to protect workers from unsafe hazards in their work environment. This act placed much of the responsibility on the employer, outlining that an employer is responsible for any employee accident that happens on company property, while conducting work activities, during breaks and lunch, and while employees may be off-site for work-related activities such as travel, workshops, etc.

There are two common types of workplace accidents that employers should be aware of when thinking about liability.

Job-Related Accidents

Accidents are considered “job-related” if they happen either in the workplace or in the course of an employee doing his or her job. There are two distinct types of accidents as defined by the legal system: a detour and a frolic.

A detour indicates that the accident occurred while the employee was engaged in job-related activities but deviated from explicit instructions. However, the deviation is still so close to what the employee was instructed to do that the employer is held liable.

A frolic indicates that an employee acted of his or her own volition and not under the instruction of an employer. In this instance, it is less likely the employer will be held accountable.

Here are some examples:

  • A company loans its employees cars for business use. Late at night, an employee is using the car to run personal errands and gets into an accident. The employer will more than likely not be held liable for the accident since the employee was not using the car for work-related activities.
  • A company gives its employees cell phones so they can remain connected while on the road. While driving, an employee uses his or her cell phone to call in for a conference call, gets distracted and causes an accident. The employer will more than likely be held liable for the accident since the employee was engaged in business activities when the accident took place.

Job-Related Illness

If an employee suffers from an illness due to exposure to a dangerous chemical or virus while on the job, they are eligible to file a worker’s compensation claim, and the responsibility would fall to you, the employer. Proving an illness is job-related can be tricky, so it is a fairly rare claim.

In the case of a workplace accident or illness, you are required to file OSHA paperwork if you meet the following criteria:

  • Having more than 10 employees
  • Classification as a non-exempt industry

Partially exempt industries (including low-hazard fields like retail, service, finance or insurance) are also required to file paperwork that differs slightly from the above.

Negligent Hiring and Retention

Employers can also be held responsible for their employees’ actions if they negligently hire or retain an employee with a criminal record. In these cases, employers can be held accountable for the criminal activity of their workers even when they are not on the clock.

Here are some examples:

  • An elder-care facility hires a woman who was previously convicted for fraud and identity theft among the elderly. The company would be held responsible for negligent hiring of an employee known for scamming elderly people and for granting her access to that population.
  • A female employee submits a sexual harassment complaint stating that a co-worker is stalking her. If the accused employee attacks the female employee at a later date, the company would be held accountable for negligent retention for not taking corrective action after learning the employee was a threat.

Handling Accidents

Once an accident happens, the damage has been done. The best thing to do is call the appropriate medical or legal authorities to handle the incident, contact your insurance provider immediately and file any required paperwork to report the accident in a timely manner.

While it may seem as though you have no recourse in the instance of workplace accidents, the best thing you can do is to cover as many protective policies and procedures in the employee handbook beforehand. Make sure every new employee signs it on their first day, and always keep a copy of it on file. If new concerns or incidents arise, consider updating your handbook with relevant policies. A signed handbook and other policies will help at a later date if an employee sues you.

It is also important to have a reputable worker’s compensation insurance plan in place. This insurance basically makes it easier for employers to fulfill employees’ claims as the result of an accident or illness. In most states, employers are required to have worker’s compensation insurance, and employers who don’t have insurance open themselves up to more liability and may have to pay penalties. If you’re seeking worker’s compensation insurance, consider bundling it with other forms of business insurance in order to reduce your monthly costs. Learn more about worker’s compensation here.

To prevent negligent hiring and retention, it is wise to conduct background checks on any potential employees and to make clear in your codes of conduct what behavior will and will not be tolerated. Note that, in most cases, worker’s compensation does not cover negligent hiring or retention claims.

In the end, you will be held responsible for a majority of your employees’ actions, so it is smart to recruit, hire and train wisely.