Is an employee of a company personally liable if they violate the law on behalf of the company?

Question

In essentially any interaction between customers and businesses, there are people on the business end who are communicating with customers on the business's behalf. This might mean customer service agents, repairmen, store clerks, or any number of other positions.

If one of these representatives of the company violates the law in their carrying out of company business, can they be held personally liable, or are they protected under the company umbrella?

For example, say an employee at a restaurant refuses to serve a gay man, or an account manager at Wells Fargo fraudulently creates a bank account for an unwitting customer. Can either of these employees be held personally liable for illegal behavior on behalf of a company? What difference does it make if the company shows a pattern of this behavior through other employees?

Answer 1

The only excuse would be if you didn't know that your actions were a crime (not ignorance of the law, that's not an excuse, but ignorance of facts).

For example, if your boss doesn't want you to serve a customer because that customer is gay, and your boss tells you "don't serve that customer, he was here last week and didn't pay the bill", you would be fine.

Or if the boss of a demolition company sends a crew out to demolish the house of a personal enemy (surely a crime), the crew would have no idea that their action is a crime, so they should be fine.

But if the boss of a bar or club orders a bouncer to beat up a customer, then the bouncer would know that he's committing a crime, and there is no excuse possible.

Answer 2

An employer is vicariously responsible for the acts and omissions of their employees done in the course of their employment. That is, whatever they do unless they are on a “frolic of their own”.

Individuals are always responsible for any crimes they commit. Also, if the employee and employer are engaged in a joint criminal enterprise then they do not owe each other a duty of care.

For tortuous acts or other civil wrongs, at common law, the employee is also liable, however, many jurisdictions protect employees from being sued.

Answer 3

Generally speaking, the employee will be personally liable, whether you're talking about a crime or a civil cause of action. In civil cases, people usually try to go after the employer instead of -- or in addition to -- the employee, assuming the business has deeper pockets. If you had it out for the employee, though, his liability may effectively be limited by law or contract requiring the employer to indemnify the employee.

On one of the specific examples you mentioned, though, we may have an exception. Civil-rights laws like that, at least in the public-accommodations realm, are often written in a way that explicitly limits them to businesses or employers. In that case you'd probably have a hard time holding an individual employee personally liable.

Answer 4

Your question is rather unclear on whether you're asking about criminal or civil liability, and what the employee policy is.

At least in the US, discrimination is a civil, not criminal, matter. If a company has a policy prohibiting gay customers, then they are civilly liable. An employee would not have the right to overrule that policy, (and in some cases, could be committing a crime if they did serve a gay customer), and so would not be liable.

If a company doesn't have a discriminatory policy, they still could face liability if an employee discriminates. The employee would also be liable, both to the customer discriminated against and to the company. In some cases, the employee could be criminally liable.

Fraudulently creating an account is a criminal matter. If an employee is acting on their own, they can face both criminal and civil liability, while the employer could face civil liability, but not criminal.

If the employer has policies encouraging fraud, then the employer could face criminal liability.