Employer's Liability

Employer's liability constitutes an import part in the tort law and is of long standing in foreign law theory, legislation and judicial practice. As a result of different social system and ideology, there is no provision in our General Principles of Civil Law and not much discussion in this respect in our law theory circle. In the course of our economic development and establishment of socialism market economy, infringement upon a third party's interests is, however, rising gradually during the employer's performing of its duties. With our increasingly diversified economic elements, classification of enterprise legal persons by different types of ownership no longer exists and it becomes an urgent need to establish our own employer's liability system to fill the gaps in legislation. Based on the historical development and theory of law in respect of employer's liability, it is discussed by using comparative law as a method of research in this article the doctrine of liability fixation, liability composition and indemnification liability in respect of the employer's liability with the employment relationship at the core. Issues discussed mainly include employment relationship, basis of determination of employment activity, employer's liability under special circumstance and assumption of indemnification liabilities. By comparing with relevant foreign theories of law, legislation and judicial practice, an analysis of relevant provisions on employer's liability in the "Interpretation on Several Issues in Trial of Cases of Personal Injury Damages"of the Supreme People's Court (Fa Shi [2003] No. 20) is made. By taking into account the most recent achievements in the research of employer's liability, corresponding suggestions are made to the future legislation of employer's liability. In the preface of this article, the connotation and denotation of employer's liability are discussed. The employment relationship referred to in this article is a "relationship of using"the employer's selection and appointment of and supervision over the employee rather than being restricted to an employment relationship arising from the employment contract. It is more scientific to express "employer's liability"as "user's liability". The historical development of employer's liability is illustrated in Part I of this article, outlining its origin and development in the continental law system and Anglo-American law system, as well as the establishment of employer's liability in China and drawing the line between the employer's liability and the "vicarious liability". Moreover, the legal basis of employer's liability is discussed and a summary of six prevailing mainstream theories is provided. Finally, the doctrine of liability fixation of employer's liability is discussed and divided into three categories with their own features after a general overview of the statutory examples of some typical countries. By comparing with the practice and theory basis of relevant countries and regions, it is pointed out that the current doctrine of liability fixation of employer's liability tends towards the doctrine of strict liability. Part II of this article is a comparison between employer's liability and similar systems. From a comparative law perspective, the difference and similarity between employer's liability and the liability of manufacturer on order, liability of legal person, liability of the person assisting in debtor's performance of its obligations and liability of negotiorum gestor are discussed, especially the difference between the employment relationship and the undertaker's relationship. A feasible standard is proposed to distinguish the foregoing. The provisions in our Fa Shi [2003] No. 20 document concerning the liability of legal person are also discussed by identifying defects in those provisions and recommending amendments thereto. In addition, the relationship between so-called "liability of laborer"in our Fa Shi [2003] No. 20 document and the employer's liability is also mentioned in this part and the liability of laborer is by its nature included in the employer's liability. Part III is the most essential part of this article discussing the composition of the employer's liability. The standard of determining an employment relationship andemployment activity is elaborated. Based on an analysis of the legislation and theories of relevant countries and regions, it is concluded that an employment relationship shall be determined in China on the basis of substantial direction and supervision. As to the determination of employment activity, five comparatively special circumstances are enumerated by adopting a "comprehensive standard theory"based on an analysis of various theories and practice. Part IV of this article relates to the special circumstance in the employer's liability, that is, how to determine the employer's liability when majority employers, borrowed employee or employee are also in fault. This part is an extension of the standard of determining employment relationship described in Part III. Part V of this articles concerns the issue of indemnification liability, that is, how to realize the final indemnification of the employer's liability. It consists of two issues, the relationship between the employer's indemnification liability and the employee's indemnification liability and limitation on employer's right to recourse and employee's right to recourse. Defects in this regard are identified and amendments thereto are suggested after comparing and analyzing statutory examples.