United States: Development of Cellular Telephone Policy Limits Potential Liability for Non-Profit Organizations

Three recent court actions in the United States have highlighted the need for all non-profit organizations and small businesses to have a well-constructed and strictly enforced policy regarding the use of cellular telephones. These rules become more important if the cell phones are used in the normal course of business and are vital if the company or agency provides the cell phones for employee use.

In each of these cases the employees were using their cellular telephone for business purposes when they were involved in motor vehicle accidents. The circumstances of each accident vary widely which accentuates the breadth of scope these cases can have, and the devastating effect a liability case can have upon an employer. In Pennsylvania a stockbroker was involved in an accident while making "cold calls" to potential clients. The company attempted to avoid liability by arguing that the broker was acting "outside the scope of his employment", but paid a substantial settlement when it was reasoned that the company encouraged similar sales calls, and provided no training for safe cell phone use.

Dykes Industries lost a $20.9 million lawsuit, and Cooley Godward lost a $30 million wrongful death suit when their employees were involved in accidents while using cell phones and driving. In each of these third party suits, the employer was held liable based on the principle of vicarious liability.

Liability for incidents like this can be limited greatly if an agency takes a proactive approach to cellular telephone usage by developing and enforcing a policy that specifies when an employee may use the telephone safely. Many companies now strictly prohibit the use of cell phones while driving, others specify that a "hands-free" mode be used. Whichever policy is adopted, certain guidelines need to be followed to protect the agency.

Ensure that the policy is written, and in language employees can understand. As laws vary widely from jurisdiction to jurisdiction, a legal advisor should develop the policy in order to achieve compliance with local ordinances. Avoid overly "legalese" language in the policy so that every employee clearly understands the meaning and intent of the policy. If an employee can show that the policy is vague, arbitrary or too difficult for a reasonable person to understand it will not serve its purpose.

Have every employee read and sign a copy of the policy. Such documentation may prove invaluable if an employee violates the policy and is involved in an accident. Save that documentation in a secure personnel file in case it is ever needed.

Provide training for each employee on safe cellular phone use. Demonstrate the agency policy in place during this training, and keep accurate records of when the training occurred, who attended, and what policy was covered. Do not exempt any employee from this training; your diligence in delivering this information to staff members is critical if called into question at court.

Finally, strictly enforce the policy at all times. Whenever violations become apparent, deal with them as you would any other important work rule. Your track record of enforcement and compliance can be crucial to your legal defense following an accident.

Simply having this documentation at hand may, in itself, be a deterrent to a suit.

It is difficult to avoid litigation today, but taking well-structured proactive measures can limit liability in cases where an employee is involved in an accident and is in violation of established work rules. It can then be argued effectively that an employee acting in such a manner is clearly acting "outside the scope of his employment".