Another, related doctrine to vicarious liability is that of negligent hiring, in which an employer does not take reasonable precautions to do appropriate background checks of the employee. If a hospital hires a nurse without the necessary qualifications, the hospital may be found liable for any errors the employee performs. However, the hospital might be found vicariously liable if it hires a qualified nurse, but expects the nurse to labor under unreasonable circumstances, such as working back-to-back shifts repeatedly with a skeleton staff, or has the nurse perform her duties with improperly maintained medical devices.

The need for the doctrine of vicarious liability is manifest in the fact that it is necessary for employers to be held liable for the consequences of their policies and not blame their own imprudent actions, conducted in the name of profit, to improve their bottom line. Simply put, it is not fair to hold a teenage employee liable for improper food safety regulations imposed upon him by his or her superiors. Additionally, at times an employee may not have full knowledge of the consequences of his or her actions. Lower-level employees at Enron, for example, did not understand the scope of the fraud that their company was perpetrating.

In general, injuries related to work fall under the scope of worker's compensation law, not under the doctrine of vicarious liability. Employers are also not considered liable for employee actions such as fighting and harassment that are undertaken by the employee's own initiative (Vicarious liability, 2011, West's Encyclopedia of American Law). For the doctrine to apply there must be a close connection between the employer and the individual acting as his or her agent.

However, employers should not be complacent, and simply assume...

The courts have been seeking to expand certain aspects of the doctrine -- such as in the case of employees that use phones and other mobile devices in the car to do business and get into accidents while doing so. To circumvent lawsuits alleging vicarious liability on the part of the corporation (which are more frequent than those against individuals, given that plaintiffs are likely to target the liable entity with the 'deeper pockets') employers are enacting corporate policies prohibiting employee use of cell phones and mobile devices in the car to do business (Businesses whose employees text or place business-related calls while driving could be found vicariously liable, 2010, Business Wire). Unlike private citizens, businesses can attempt to cushion themselves against vicarious liability with clear policies that prohibit rather than encourage potentially dangerous employee misconduct.