British Supermarket Ruled Not Liable for Employee Data Leak by High Court

The leak of Morrisons’ payroll data was found to have been the fault of an employee with a grudge. The leaker revealed information of fellow Morrisons employees online, as well as selling it to newspapers, after earlier receiving disciplinary action.

Many employees whose data was revealed made claims for compensation, but the UK Supreme Court ruled that employers could only be vicariously liable for their employees’ actions if they were “closely connected” to their duties at work.

Steve Farmer, Technology Transactions partner at Pillsbury, said that the landmark verdict “fires a warning shot” toward the burgeoning class action culture developing in the UK.

“The case represents a milestone victory and a watershed moment for companies who could otherwise be subject to compensation claims on a potentially vast scale, through no fault of their own; it will have a significant residual effect for years to come,” Farmer said. “Employers must bear in mind that when an employee is deemed to be acting on behalf of an employer and a breach is suffered, the company will still be on the hook for breaches.”

“The distinguishing feature in this case is that the rogue employee was considered to be acting on his own behalf. The net result is that the door is still open for vicarious liability claims being brought in class action cases,” Farmer concluded.

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