Office of the General Counsel
April 2012
Developing a Company Policy to Minimize Potential Employer Liability Resulting
From Employee Cell Phone Use While Driving
Employers need to be aware that their employees’ use of a cell phone while driving can cause
potential liability issues. Substantial economic risk arises if the employee injures someone else
in an accident. If the employee caused the accident because he or she was distracted by using
a cell phone or texting, the employer may be vicariously liable for the employee’s accident if it
occurred within the scope of employment. Under the doctrine of “respondeat superior” an
employer is liable if the employee was acting within the scope of his duties or in the
furtherance of the employer’s interests when he caused the accident. The employer might also
be directly negligent for the resulting harm if the employer permits or encourages its
employees to use cell phones for business purposes while driving without providing guidelines
or instructions about safe cell phone use.
In addition to civil liability, according to the Occupational Safety and Health Administration
(OSHA), as a business owner or manager, it’s the employer’s legal responsibility under the
Occupational Safety and Health Act to safeguard drivers at work. According to OSHA more
workers are killed every year in motor vehicle crashes than any other cause. Distracted driving
crashes killed more than 5,400 people and injured 500,000 in 2009. Moreover, researchers
report that texting while driving claimed more than 16,000 lives from 2001 to 2007.
http://www.osha.gov/Publications/3416distracted-driving-flyer.pdf. OSHA has now officially
declared that companies are in violation of the OSH Act if, by policy or practice, they require
texting while driving, or create incentives that encourage or condone it, or they structure work
so that texting is a practical necessity for workers to carry out their job. OSHA warns
employers that it will investigate complaints and where necessary issue citations and penalties
to end this practice.
The risks associated with cell phone use while driving should be addressed as part of the
employer’s overall risk management plan. While a detailed discussion of risk management
techniques is beyond the scope of this document, risk management is a process of weighing
risks and deciding between alternative courses of action. Companies generally have five
options when considering how to manage risk: avoid the risk, minimize it, shift to another
1
party, insure it or retain (self fund) it. Employers are advised to adopt and enforce a cell phone
or “distracted driving” policy limiting or prohibiting the use of cell phones and text messaging to
address employee safety, company liability, or increased insurance costs. Such a policy will not
completely insulate an employer from liability but it will lessen the potential liability for the
company and help keep the employees and the general public safer by curtailing the number of
accidents caused by drivers who are distracted. Adopting such a policy is an example of
avoiding or minimizing the risk presented by distracted driving. This is the most efficient
approach because it is not practical to shift the risk to other parties and because it should
reduce the costs associated with the risk, either by decreased insurance expenses or by
minimizing retained risk.
Distracted Driving
According to the National Highway Traffic Safety Administration, distracted driving is any
activity that could divert a person’s attention away from the primary task of driving. In 2008, at
any given daylight moment 812,000 vehicles were being driven by someone using a hand-held
cell phone. NTHB Traffic Safety Facts Research Note (September 2009). Cell phone and text
usage while driving implicates the three main types of distraction:
Manual: taking your hands off the wheel
Visual: taking your eyes of the road
Cognitive: taking your mind off driving
Some of the statistics related to cell phone and text messaging while driving include:
•
•
•
•
•
•
2
Drivers who use hand-held devices are 4 times more likely to get into crashes serious
enough to injure themselves.
Text messaging creates risk 23 times worse than driving while not distracted.
Sending or receiving a text takes a driver’s eyes from the road for an average of 4.6
seconds, the equivalent - at 55 mph – of driving the length of an entire football field,
blind.
Headset cell phone use is not substantially safer than hand-held use.
Using a cell phone while driving – whether it’s hand-held or hands-free delays a driver’s
reactions as much as having a blood alcohol concentration at the legal limit of .08
percent.
Driving while using a cell phone reduces the amount of brain activity associated with
driving by 37%
Source: NHTSA - http://www.distraction.gov
Overview of Case Law Related to Cell Phones
A number of cases have considered whether the employer was responsible under vicarious
liability where the accident occurred while the employee was talking on the cell phone, or
immediately before or afterwards. Here are some representative cases:
In Roberts v. Smith Barney, Inc., the employee was making “cold calls” when he drove through a
red light, striking and killing a young man on a motorcycle. Reportedly, the employer did not
provide cell phones to its employees, but the victim’s family maintained that the employer was
directly liable because it encouraged employees to use their own cell phones to contact clients
but didn’t train them on safe and appropriate use. Smith Barney was sued under the theory of
respondeat superior. While Smith-Barney denied any wrongdoing, the company reportedly
settled the case for $500,000. Roberts v. Smith Barney, Inc. 1999 WL 33236939 (E.D. Pa. 1999).
In 2004, a Virginia attorney hit and killed a teenage girl while the attorney was using her cell
phone to conduct firm business. A Virginia jury found the attorney guilty of criminal charges
and awarded a $2 million sum to her family. Yoon v. Wagner, (Loudon County Circuit Court,
Va., October 7, 2004). The law firm was named in the lawsuit against the attorney but
ultimately settled with the victim’s family reportedly because the attorney was conducting
business at the time of the accident. Megan K. Loftus, Causes of Action Arising Out of Cell Phone
Use While Operating a Motor Vehicle, 35 Causes of Action 2nd 151 (Updated 2011).
In O’Toole, et. al. v. Carr, et. al., 815 A.2d 471 (N.J. 2003), the O'Tooles' vehicle was struck by
Carr's vehicle. At the time of the accident, Carr was driving to the Tuckerton Municipal Court,
where he presided as a part-time municipal judge. Carr had a portable cellular phone at the
time of the accident, which he had with him in the vehicle. Carr admitted in his deposition that
he had been on the phone while in the car but he had finished those phone calls and was not
on the cell phone at the time of the accident. The New Jersey Supreme Court found that there
was no basis to impose vicarious liability upon Carr’s law firm employer for Carr’s automobile
negligence.
In Ellender v. Neff Rental, Inc., 965 So.2d 898 (La. Ct. App 1st Cir. 2007, the court held that the
employer of a regional sales manager who was driving his own vehicle at the time of the
accident and who was found to be 100% at fault in a car accident was vicariously liable for his
negligence when the driver was using an employer-provided cell phone at the time of the
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accident, he regularly conducted business on the phone and was doing so at the time of the
accident, such activity contributed to the accident, and the employer did not prohibit the
employee from using cell phones while driving. The employer did not dispute the claims but
stated in an affidavit that it did not expect or intend for its employees to talk on cell phones
while driving. The court found that the employer provided no factual information that such
expectations or intentions were conveyed to its employees or enforced in any fashion
whatsoever. Thus, the court remarked, although the employer may not have expressly
authorized conducting business on a cell phone while driving, it certainly did not prohibit it.
Federal and state Law
In October 2009, President Obama issued Executive Order No. 13513 in which he implemented
a ban on text messaging by federal employees while operating federal vehicles. Federal Register
Vol. 74, No. 192 (October 2009).
Many states have enacted laws limiting or prohibiting the use of cell phones and text
messaging.
According to the Governors Highway Safety Association, California, Connecticut, Delaware, D.C.,
Maryland, Nevada, New Jersey, New York, Oregon, and Washington prohibit all drivers from
using handheld cell phones while driving. Except for Maryland, all laws are primary
enforcement – an officer may cite a driver for using a handheld cell phone without any other
traffic offense taking place. No state bans all cell phone use (handheld and hands-free). 35
states and D.C. ban text messaging for all drivers. 32 states, and D.C. have primary
enforcement; the others, secondary. Some states such as Maine, N.H. and Utah treat cell
phone use and texting as part of a larger distracted driving issue. Source - Governors Highway
Safety Association - http://ghsa.org/html/stateinfo/laws/cellphone_laws.html
Guidelines to Consider When Drafting A Distracted Driver Policy
As noted above, it advisable to adopt and enforce a written policy on cell phone use and text
messaging. Such a policy will not completely insulate an employer from liability but it will
lessen the company’s potential liability and help keep its employees and the general public
safer by curtailing the number of accidents caused by drivers who are distracted. The policies
should be at least as restrictive as the laws of the states in which the company operates.
Obviously, the safest and most comprehensive policy is to implement a cell phone ban (even
use of hands-free devices) that would include not only making or receiving phone calls, but
texting, emailing, surfing the internet, social networking, playing video games, watching movies
and any other activity requiring manual manipulation of the phone. The ban would apply to
any employee operating a company vehicle, using a company-issued cell phone or personal cell
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phone while operating a personal vehicle, and making calls for business purposes outside work
hours. For examples of policies banning cell phone use see - Sample Employer Policy on
Distracted Driving, www.nhtsa.gov and Model Company Policy B Distracted Driving,
www.cvsa.org, at the end of this document.
If a total ban on cell phone use is not feasible, at a minimum ban text messaging. Employees
should be reminded that “texting” creates the highest risk of accidents and that OSHA has
officially declared texting while driving a workplace hazard and an OSHA violation. Consider
allowing employees to make work-related phone calls if the phone is equipped with a handsfree, voice-activated device that will allow the call to be made without manually dialing.
According to one source, “[r]esearch has shown that there’s virtually no increase in the risk of
an accident or near accident while talking or listening on a cell phone compared with
undistracted driving.” Hall, Farley, Oberrecht, Blanton, P.A., Legality, Practicality of Employee
Cell Phone Use While Driving, 15 No. 6 Idaho Emp. L. Letter 1 (September 2010). Arguably, the
NHTSA would disagree with this conclusion (Using a cell phone while driving – whether it’s
hand-held or hands-free delays a driver’s reactions as much as having a blood alcohol
concentration at the legal limit of .08 percent) - http://www.distraction.gov. Additionally,
employers should consider periodically checking the motor vehicle records of employees who
are required to drive a vehicle in the normal course of employment, requiring such employees
to regularly report moving violations, and purchasing appropriate equipment for use by
employees that can help minimize the risks of accident. Such equipment could include:
handsfree car kits and headsets; speakerphones; and one-digit dialing features and voiceactivated dialing. Robert J. Nobile, Employer Liability for Cell Phone Negligence, Essential Facts:
Employment § 10:54 (Updated August 2011).
Regardless of whether the ban is total or limited, the employer must make it clear to the
employees that (1) the policy applies to personal cell phones whenever the employee is driving
a company vehicle or on company business, and (2) to company cell phones even while the
employee is off the clock. This would be equally true where the employee uses his personal
cell phone and the employer provides the employee with a stipend to help offset the business
need.
A policy should also consider the following:
•
•
5
Take calls off the road. When a total ban isn't feasible for your business, implement a
partial ban. Instruct employees to pull off the road and park their cars in a proper
parking area before placing or receiving a phone call.
Prohibit cell phone use during severe weather or traffic conditions. Tell your employees
not to use their cell phones in adverse weather, in heavy traffic, or in other
circumstances that demand increased attention to the road.
•
•
•
•
•
•
•
•
Ban personal calls. Forbid employees from making or taking personal calls while driving
on company time, in a company car, or with a company phone.
Limit calls. Tell your employees that phone calls while driving must be limited to brief
conversations and they must pull over and park in a proper parking area if the call
becomes involved. Reinforce the fact that they shouldn't take notes, check voice mail, or
send or check e-mail while driving.
Make an exception for emergencies. Clarify that employees may use cell phones while
driving if necessary for emergency calls that require police or medical attention.
Explain employee liability. Your policy should include a statement that employees bear
sole responsibility for liabilities incurred from traffic violations or accidents involving the
use of a cell phone while driving.
Include a signed acknowledgment in your written policy. Each employee should receive
a copy of your written cell phone policy and should acknowledge in writing that he has
read and understood the policy and its consequences.
Conduct training and follow up with enforcement. Your policy will mitigate your liability
effectively only if employees are aware of it and you enforce it. To the extent your policy
allows cell phone use, you should provide mandatory training and education about local
laws and the dangers of talking on the phone while driving.
Place warnings on company phones and in company cars. Warning stickers remind
drivers of your cell phone policy and the dangers of driving while on the phone.
Review your coverage. You should review your current level of commercial auto
insurance coverage and evaluate whether it's sufficient in light of the recent cases
resulting in high-dollar jury verdicts and settlements in employee accident cases.
Charles McClellan, Dialing for Disaster: When Employees Talk on Cell Phones While Driving, 14
No. 4 Kan. Emp. L. Letter 1 (July 2007). Finally, make it clear to employees that they are not to
place themselves at risk to fulfill business needs. Stated differently, employees should not be
instructed to “take calls at all times.”
Consider making your cell phone policy part of your overall safety practice. Builders Mutual
Insurance Company offers these helpful safety tips:
Having safety meetings (toolbox talks) on your construction site is key to your safety
program. When used properly, these talks can be an effective method for teaching
workers safety awareness and for conveying the importance your company places upon
safety. It is up to you to make these topics as interesting and engaging as possible.
6
• Hold meetings regularly—regular meetings emphasize the value of safety within the
company and promote awareness of the safety culture.
• Choose relevant subject matter. Nothing will lose the audience faster than a topic that is
unrelated to the job at hand.
• Keep it short and sweet. Make sure to review the main points of the talk and encourage
discussion with pointed questions.
http://www.buildersmutual.com/Policyholders/RiskManagement/#section2. See also “Is Your
Driving Policy Stalled,” Reprinted with Permission from Builders Mutual Insurance Company, at
the end of this document.
Finally, the employer should ensure that the company has sufficient insurance. Automobile
liability is a common area where the potential severity of risk is underestimated, which can
result in unintentional risk retention. Risk retention may occur if the risk manager identifies the
risk, but underestimates the potential severity that the loss can cause. The difference between
the identified risk and the actual loss is a retained risk for the builder. This may occur where
risk management measures are employed, but they fail to address the full range of potential
losses. For example, in the case of automobile liability, even though insurance is usually
purchased for automobile liability risks, the limits may not be adequate when a serious accident
occurs. Risk Management/Insurance for Building Professionals, Student Guide, prepared for
the National Association of Home Builders by Cox, Castle & Nicholson, LLP and Breitstone &
Company, Ltd (2003). This is an area where the services of a knowledgeable insurance
professional would be of great benefit. See How Knowledgeable Insurance Professionals Can Help
Builders Survive the Liability Insurance Crisis (NAHB 2004).
Conclusion
Whether you choose a total ban on cell phone usage or a take a less restrictive approach will
depend on your company’s needs and its tolerance for risk. At a minimum, you should create a
written policy addressing distracted driving, insist that employees obey the laws of whatever
jurisdiction they drive in, communicate the policy to your employees, and implement and
monitor compliance with your policy. If you have a policy in place that is not enforced, and
your employee is in an accident leading to a lawsuit by the injured party, a court might find
your company directly liable because you were aware of the risk and chose to ignore it.
DISCLAIMER
This guide was prepared for the educational and informational use of the members of the
National Association of Home Builders. It is being provided with the understanding that the
author and publisher are not providing legal or other professional advice. The discussions
7
herein are not a substitute for considered professional advice. If specific legal advice or
professional assistance is required, the services of a qualified professional should be sought.
The information contained herein, including any sample addendums, are also subject to
statutory, regulatory or judicial revision. The National Association of Home Builders expressly
disclaims any responsibility for any damages arising from the use, application, or reliance on the
recommendations and information contained herein.
For more information contact David S. Jaffe, Vice President, Legal Advocacy, Office of the
General Counsel at [email protected] or at (800) 368 ‐5242, ext. 8317.
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Knowledge Builder
Tips from your industry experts at Builders Mutual
Is Your Driving Policy Stalled?
Here in NASCAR country, you
find fans around every corner.
Makes you wonder if your
employees imitate their favorite
NASCAR drivers on the road.
Are you neutral about your
employees’ driving habits?
To manage your company’s risk
on the road, set expectations with
a written driving policy. Reiterate
that drivers must obey all traffic
laws, including speed limits and
seat belt usage.
It’s contractor culture to make
calls while driving, but every call
takes precious attention away
from the road. So, your driving
policy should specify that drivers
must park a vehicle to make any
necessary calls in transit.
For crews traveling together,
clearly dictate who has driving
privileges. Accidents under these
circumstances
can
be
catastrophic because there’s
often
inadequate
seating—
meaning a shortage of seat
belts—for
the
number
of
employees in the vehicle. Your
driving policy is designed to avoid
these dangerous situations.
Think twice about allowing
employees to use company
vehicles
for
personal
use.
Preferably,
drivers
should
commute to and from the place
where company vehicles are
garaged. You don’t want your
business’ insurance policy to
respond to an auto accident
arising from an employee’s
personal activities.
A Virginia contractor made an
exception for the employees who
were on call 24 hours.
He
allowed his crew to take vehicles
home, but he had a GPS installed
on each vehicle, which triggered
an alert for any travel outside of
the designated work area.
For companies with fleets,
consider
fleet
management
vendors that offer services like
GPS or driver monitoring, using
toll-free numbers and websites. If
speed is a concern, consider
installing governors on vehicles.
On the flip side, reward
employees with safe driving
awards and incentives.
Vehicle maintenance is key
Schedule routine maintenance for
both vehicles and trailers, and
keep documentation so you can
track what was done and when.
With
regular
maintenance,
vehicles are less likely to break
down.
It can even decrease the
likelihood of an accident. How?
Tires are a great example. With a
careful eye on tread depth, a
rainstorm won’t catch any of your
drivers unable to grip the road
because of nearly bald tires.
Without regular inspection, a
failure of brake lights or turn
signals can go unnoticed. If other
drivers aren’t alerted to the
movements of vehicles around
them, they’ll have more difficulty
responding to sudden changes in
course.
There’s an HVAC contractor who
keeps his vehicles on a
maintenance
schedule
like
clockwork. His repair team is the
▲Get your company’s driving
policy road-ready.
first to drive new vehicles.
They’re in pristine condition
parked in front of a client’s house,
which is great for his company’s
image. After two years with the
repair team, he turns the vehicle
over to his installation team.
They do installs on dusty jobsites
more often than not, and a slightly
used vehicle hardly matters to a
client who’s nowhere in sight.
After two more years, he trades
the vehicles in, and the cycle
begins again.
Accessorizing—
not just for girls
Fog
lamps,
brush
guards,
winches…they all make a truck
look more rugged. But they serve
a purpose. Tie down points are
no exception.
Use them as
they’re intended, and properly
secure your load. Use heavy
duty straps. Wire doesn’t cut it!
Builders Mutual Insurance Company
PO Box 150005 │ Raleigh, NC 27624 │ 800.809.4859
Knowledge Builder
Tips from your industry experts at Builders Mutual
For vans, use the tie offs on the
rack. Be careful that the vehicle
doesn’t become too top heavy,
though. Siding contractors are
especially at risk. With ladders,
pump jack equipment, and siding
materials, the weight adds up.
Cages should be installed in all
vans, for materials stored inside,
so they don’t shift forward and
impair the driver if the driver
needs to slam on the brakes. In
fact, this is just as important in a
pickup truck, so materials don’t
crash through the rear glass.
Let them share their record
before they share the road
Do your best to hire responsible
drivers. Pre-hire, find out what
your candidate’s driving record
looks like by running a Motor
Vehicle Record (MVR). Simply
make a copy of the candidate’s
license, and submit it to your
insurance agent.
Either the
agent or your insurance company
will run an MVR.
MVRs show things like speeding
tickets, accidents, DWIs, and
points (for states which use the
point
system).
Typically,
insurance companies run MVRs
approximately annually to check
for any changes in people’s
driving records.
company’s reputation by putting
an experienced teenage driver on
your company’s auto policy. Be
sure to separate the risk by
adding him or her to your
personal auto policy.
With all these tips, you can kick it
into gear, and get your company’s
driving policy road ready!
Employment
pre-screening
services are also available for a
fee, and vendors may package
services such as a credit check,
background check, and a drug
test with the MVR.
Looking for a clean record also
means looking for an experienced
driver.
Should it go without
saying that your 16-year old son
or daughter doesn’t belong on
your policy?
Don’t risk your
For more free
risk management resources,
visit www.buildersmutual.com/RM.
Builders Mutual Insurance Company
PO Box 150005 │ Raleigh, NC 27624 │ 800.809.4859