News
Morrisons Sues Employees
Southend-based solicitors, BTMK, is warning businesses to ensure their employees are properly versed in all relevant legal policies, in light of a recent employer versus ex-employee case.
Plenty of employees get the law wrong and the employer picks up the tab in areas as far apart as health and safety and date protection. Companies can only operate through employees and are responsible in most cases for what employees do.
In a groundbreaking case, Morrisons has sued personally, former employees and directors of Safeway, the company it acquired, for alleged breach of the competition rules and in a bid to recoup losses associated with alleged price fixing on milk in 2002 and 2003. It is understood that a Directors and Officers insurance policy may have been in place and that Morrisons is therefore seeking to cover its potential fines of £16m by recouping them under this insurance.
BTMK Commercial Litigation Partner, Saul Caplan said: “Whilst very rare, sometimes organisations have sued members of staff for provision of bad advice which led to the employer being held negligent to its customers. This case is along similar lines. The ex-employees and directors in this competition case applied to have the case thrown out of court but failed. Morrisons here disputes all allegations of breach of competition law.
“The employees tried to throw the case out on the grounds that if the company were liable it could not go to court to seek recovery – a long standing legal principle that you cannot profit from your own wrong, in the same way as when someone murders their spouse to recover insurance policy monies, their claim will fail.
“It is likely that, if the case succeeds at trial, insurance for directors will become more expensive and insurers will want to check there have been no competition law breaches before offering the policy in each case. The case also illustrates the importance of having good competition law compliance policies and training in place for employees.”
If you would like your policy amended or updated, or you would like to receive advice on this area of the law, please call BTMK on 01702 339222.
