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Can an Employer Be Held Liable for an Employee's Theft?

Can an Employer Be Held Liable for an Employee's Theft?

Full question:

If an employer is found guilty of employee negligence in hiring a theft, what charges can brought against the employer? Would it be criminal with jail time or fine charges?

Category: Employment
Date: 04/07/2025
State: Maryland

Answer:

Negligent hiring is a claim made by an injured party against an employer based on the theory that the employer knew or should have known about the employee's background which, if known, indicates a dangerous or untrustworthy character. Pre-employment background checks, employee drug testing, and employment physical exams are some of the ways negligent hiring claims can be avoided.

Roughly half of the states legally recognize that an employer is responsible for, and can be held accountable for, checking the background and references of any job applicant before placing that applicant in a position of high public contact. Employers have been found liable for negligent hiring or retention of dangerous or incompetent employees in most states, including, among others, Alaska, California, Florida, Georgia, Illinois, Kansas, Maryland, New Mexico, and New York. Some of the the types of business employees most at risk to do harm due to failure to make informed hiring decisions include real estate agents (who have keys or know pass-lock combinations), rental apartment personnel, condominium personnel, delivery persons, service and maintenance persons, nursing and convalescent home workers, home health care aides and utility personnel.

Because the claim is based in negligence, it falls under civil law, rather than criminal law. Civil suits typically seek to recover money damages or allow/disallow certain acts, rather than to imprison or punish a person. Civil lawsuits seek to restore the person to the position he/she would occupy before the harmful act, such as out-of-pocket losses for the value of items taken.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

Is an employer liable for an employee's negligence?

Yes, an employer can be held liable for an employee's negligence under the legal doctrine of vicarious liability. This means that if an employee causes harm while performing their job duties, the employer may be responsible for the damages. However, liability often depends on the specifics of the case, including whether the employee was acting within the scope of their employment at the time of the incident.

Can you charge an employee for negligence?

An employee cannot be 'charged' for negligence in the same way a criminal charge is filed. Instead, negligence can lead to civil lawsuits where the injured party seeks damages. If an employee's actions are found to be negligent, they may be held financially responsible for any harm caused, but this is a civil matter rather than a criminal one.

What are the consequences of negligent hiring?

Consequences of negligent hiring can include civil lawsuits against the employer for damages caused by the employee's actions. Employers may face financial liability for injuries or theft committed by an inadequately vetted employee. Additionally, negative publicity and loss of reputation may also occur, impacting future business opportunities.

What is the employer's liability?

An employer's liability refers to their legal responsibility for the actions of their employees. This includes being accountable for negligent hiring practices, where an employer fails to adequately screen a potential employee and that employee causes harm. Employers can be liable for both direct and indirect damages resulting from their employees' actions while on the job.

When an employer is liable for the negligence of an employee, it is?

When an employer is liable for the negligence of an employee, it is known as vicarious liability. This legal principle holds employers responsible for the actions of their employees performed within the scope of their employment. This means if an employee's negligent act causes harm while they are working, the employer may be required to compensate the injured party.

Can an employer withhold pay if the employee is accused of stealing?

An employer may withhold pay if an employee is accused of stealing, but this must be done in accordance with state laws and company policies. Employers should ensure that any withholding of pay complies with wage and hour laws. It is advisable to conduct a thorough investigation before taking such actions to avoid potential legal issues.