vicarious liability
Definition
Vicarious liability means you can be held legally responsible for the harmful actions of someone else, usually because of your relationship with that person. As a business owner, this most commonly applies to your employees, meaning if one of your workers hurts someone or causes damage while doing their job, you can be sued even though you personally did nothing wrong.
Example
If your delivery driver runs a red light and hits another car while making a work delivery, the injured person can sue you as the business owner even though you were sitting in your office at the time.
Watch Out
This is exactly why carrying strong general liability and commercial auto insurance is so important, because your personal and business assets can be on the line for things your employees do.
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This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.