How to Avoid a Lawsuit for Negligence

Negligent entrustment can make you lose your business and investments. You should never trust your employees completely unless you’ve performed your duties as a responsible employer.

This is the only way to prevent negligent entrustment lawsuits in the future. Conduct enough research about the employee and enforce your rules strictly.

The Meaning of Negligent Entrustment

A lot of businesses encounter negligent entrustment lawsuit. But what is meant by negligent entrustment? This happens when an employer allows any of his or her employees to use dangerous equipment (e.g. motor vehicle) even if the person has previously misused such equipment in the past or in short, not qualified to use the equipment. Even if the employer didn’t know about the history or reputation of the employee, he or she can still be sued for negligent entrustment since such info can be obtained through reasonable search.

Ways to Do it

There are ways to prevent negligent entrustment. You must set up hiring criteria. You should have a policy for hiring employees who will handle motor vehicles. The criteria should be enforced equally and there should be no exceptions. Pre-employment investigation is necessary. You can assign one of your personnel to conduct the investigation on the DMV records of applicants. It would also be a good idea to ask for referrals or references from previous employers; the findings and conversations should be documented as well. Aside from checking DMV records, the credit history and criminal background of the applicant should also be checked. If the applicant has previous records, it connotes that the applicant is irresponsible. After hiring an employee, you will still need to review their records annually. MV records should also be checked for those who might drive the company vehicle for business trips. You can take advantage of the ‘pull notice’ program offered by the state DMVs so that you can be informed within 2 weeks when any of your employees had violations. This is quite cheap and your business will greatly benefit from it.

You should be strict in implementing the rule that only the employees of the business can use the vehicle. It would not be a good idea to let the driver take the vehicle home because other family members might use it. If you consent to this set up, make sure that you have a written prohibition which states that other family members can’t use the vehicle especially those under 25 years. Now that you’ve practiced your due diligence, make sure that you keep all the documents – training records, pull notice report, reference checks, background checks, warning notices, etc. for reference purposes. As a reliable employer, you need to hold monthly meetings and annual trainings for your drivers. Negligent entrustment can cost you everything and you can go bankrupt. Make sure that you performed all the necessary measures to ensure that you’ve done due diligence.


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