What is a Breach of Fiduciary Duty?
Some relationships carry fiduciary duties and responsibilities according to the law. These relationships are held to a higher standard so that a breach of said duty is actionable in the court of law. Usually, a fiduciary relationship exists when one party must act in the best interest of another party and that party places confidence and trust in another.
What are Fiduciary Duties?
A fiduciary duty exists between parties of a transaction where one party is bound to act according to good faith, fair dealing, and for the benefit of the other party. In these relationships, one party invests their confidence in the loyalty and integrity of the other, known as the fiduciary. The party that the obligation or duty is owed to is the beneficiary. Some fiduciary duties are governed by statute and others are defined specifically in contract terms.
Some examples of those who have fiduciary duties include medical professionals, such as physicians and psychiatrists to their patients; legal and financial professionals; spouses; and appointed guardians. Often, corporate directors have fiduciary duties to shareholders, as well as employees to their employers. Fiduciaries have the following duties and responsibilities:
Duty of Loyalty. The fiduciary is under obligation to act on behalf of the beneficiary and never knowingly act against their interest. If a conflict of interest exists that prevents the fiduciary from complete loyalty to the beneficiary, this conflict must be disclosed to the beneficiary.
Duty of Care. The fiduciary is also under a duty of care to the beneficiary and must act in a reasonably safe manner in accordance with the standards set in the community.
Duty of Fair Dealing. The fiduciary must also act in a fair manner and not take advantage of the confidence of the beneficiary to gain profit or unfair disadvantage.
Duty of Confidentiality. The fiduciary also owes a duty to not disclose sensitive information given to them in confidence without informed consent or use the information to their advantage.
Claims for Breach of Fiduciary Duty
To file a claim for breach of fiduciary duty, one must first establish that a fiduciary duty existed. Whether a fiduciary duty existed is a matter of law determined by a judge in a court of law. Whether a fiduciary duty exists is a legal question. However, how or what type of duty was breached is a matter of fact often determined by a jury.
One who is injured by the breach of a fiduciary duty is entitled to recover the actual damages incurred, as well as punitive damages. Punitive damages are usually awarded if malice or fraud can be proven. After it is established that fiduciary duty exists, the claimant must then show that a breach of said duty occurred and that the claimant suffered harm caused by said breach.
If you experienced a breach of fiduciary duty, you need comprehensive representation from an experienced professional liability attorney. MacMain, Connell & Leinhauser has expertise in defending professionals against breach of fiduciary duty claims. Contact us online or call us at 484-318-7106 for an initial consultation. Located in West Chester, Pennsylvania, we serve clients throughout Philadelphia and Chester County.
Company Picnic and How to Avoid Liability
As summer quickly approaches, employers are planning for social events like company picnics. While there are many advantages to hosting a company picnic, employers should take certain precautions to avoid liability for any injuries that may occur at company-sponsored events.
Employer Liability for Company Picnic Injuries
In Pennsylvania, most employees are entitled to workers’ compensation for their work-related injuries. Employees do not need to be injured at work in order to recover; as long as they were acting in the course and scope of their employment, their injuries may be compensable under the Pennsylvania Workers’ Compensation Act. Therefore, if an employee is injured at a company picnic, the employer may be liable if:
- employee participation was mandatory;
- the event was company-sponsored; and
- the employer directly benefitted from the employee’s participation.
Employers may also be liable for any harassment or discrimination that takes place at a company picnic, such as sexual harassment or religious discrimination. When alcohol is served, there is an increased potential for inappropriate behavior and employers may open themselves up to social host liability if they knowingly furnish alcohol to minors. Therefore, when planning summertime company picnics, employers should therefore take certain steps to minimize risk and avoid liability, including:
Tips to Minimize Liability Exposure
- Make attendance optional
- Do not compensate employees for attendance
- Hold the party off company premises
- Do not conduct business at the company picnic
- Limit the amount of alcohol served by providing employees with drink tickets
- Provide non-alcoholic beverage options
- Do not exclude any employees from the event based on their race, religion, gender, or any other protected characteristic
- Remind employees of the company policy against harassment and discrimination by sending out a memo before the event
- Provide alternative free transportation for employees who are unable to safely drive home
Benefits of Company Picnics
Employers should not be deterred from throwing company picnics and other events, but rather simply take the appropriate steps to minimize their liability exposure. While company picnics can potentially open employers up to liability, there are many benefits to hosting company-sponsored events, including that it:
- Encourages interdepartmental communication – Company picnics give employees from different departments the chance to communicate and better understand the connection between their roles in the company.
- Boosts employee morale – Employees often look forward to the company picnic as a reward for all their hard work throughout the year; company-sponsored events boost employee morale, leading to improved performance following the event.
- Provides an opportunity for employers to show appreciation – Hosting a company event is a great way for employers to show appreciation for their staff’s hard work and dedication.
- Allows employers to build rapport with their staff – Employers have an opportunity to connect with their employees outside of a work setting, leading to increased rapport and trust.
- Can be a great time to make company-wide announcements – If there is an important company-wide announcement to be made, the company picnic may be an opportune place to do so.
For more information on how to avoid company picnic liability as an employer, contact MacMain, Connell & Leinhauser by filling out an online inquiry or calling us at 484-318-7106. From our office in West Chester, our experienced employment lawyers serve clients throughout Pennsylvania.
Avoiding Liability During Holiday Parties
This time of the year is often filled with office parties and corporate holiday events as many companies celebrate Christmas and New Year’s with employees and clients. The fun of holiday festivities, especially with the consumption of alcohol, also brings an increased risk of sexual harassment and alcohol-related accidents. For some companies, this could mean additional liability exposure if inappropriate or reckless behavior leads to injury. By following some of the helpful suggestions below, companies can limit their liability should a holiday event go wrong.
Understanding Liquor Liability Laws
Serving alcohol at a corporate holiday party places a company at an increased risk for liability. Companies may be held civilly or criminally liable for injuries resulting from an individual’s intoxication if the company provided the alcohol. Liquor liability laws vary state to state but hold businesses liable for serving alcohol to intoxicated or underage persons. Many businesses provide transportation home from holiday parties or arrange for hotel stays to avoid the possibility of an alcohol-related driving accident.
Limit Alcohol Consumption
If alcohol is to be served at a company party, businesses can encourage employees to drink responsibly by using drink voucher systems limiting the number of drinks everyone may be served or shortening the time that alcohol drinks will be offered. Offering food and non-alcoholic drink alternatives may also help limit alcohol consumption at a holiday party. Cash bars can decrease the amount of alcohol consumed as employees drink less when they must purchase their own drinks. Hiring a professional bartender to handle the serving of drinks can also help a company monitor the alcohol consumption of the party attendees.
Communicate Sexual Harassment Policies
Companies should review their sexual harassment policies with all employees prior to holiday party season. All sexual harassment policies should include guidance with respect to employer sponsored social events. Employees should be made aware these policies apply not only at work but at company functions occurring off the work premises. Some companies chose to make holiday parties more family-friendly with the inclusion of spouses and children to discourage inappropriate and harassing behavior. Businesses can proactively ban certain customs that could potentially lead to allegations of a hostile work environment, such as hanging mistletoe in the office and the exchange of adult-themed risque gifts.
Follow Wage and Hour Laws
State wage and hour laws will determine whether a company needs to pay its employees for attendance at a holiday party. Mandatory attendance at a holiday party would require a company to pay for the employee’s time. If attendance at the party is not mandatory but strongly encouraged, courts may find the company implicitly required the employee’s attendance. By making attendance entirely voluntary, companies may be able to avoid paying additional compensation to its employees.
Obtain Proper Liability Insurance
Despite a company’s best efforts to reduce all injury or harassment risks, incidents inevitably will occur during holiday parties. As a precaution, all businesses should have the proper liability insurance to provide financial protection, including commercial general liability and employment practices’ liability policies. Some businesses may need to purchase special event coverage depending on the nature of the holiday celebration.
With offices conveniently located in West Chester, Pennsylvania, our team at MacMain, Connell & Leinhauser proudly represents businesses throughout Philadelphia and Chester County. Call us today for more information about protecting your business from liability at 484-318-7106 or contact us online.
Church Security Awareness Month
October is Church Safety and Security Month, a great time to make sure that your church or other religious institution is adequately protected.
Churches used to stay open around the clock. But the violent events of recent history have changed that tradition. Now, churches must be safeguarded against shooters, robbers, and other criminals.
Here are some tips for keeping your church safe during October and throughout the year.
Church Security Measures
The first step in keeping your congregation safe is to conduct a church security assessment, to identify potential threats, and develop plans of action. Be sure to know your local neighborhood, so you can identify potential issues.
Here are some things to consider when developing a security plan:
Church access: If there are many entrances to the church, consider having only one open during business hours, and securing the additional entrances with heavy doors, locks, and security windows.
Implementing a procedure for giving out and collecting keys to the church may be helpful in preventing former staff or members from having easy access to the church and any valuables inside.
Also, be sure to lock up valuables such as microphones, televisions, and computer equipment, to protect against theft.
Dangerous property conditions: If your church is having repairs or remodeling done, be sure that the proper warning signs are posted, and that work is completed in a reasonable amount of time.
Churches must expediently address known hazards and keep the premises reasonably safe for churchgoers and staff. If someone is injured on your property due to your negligence, they may file a premises liability lawsuit, which may subject you to responsibility for their injuries.
Armed security: Many churches do not want to have armed security on the premises. However, it may be wise to consider nowadays. There were 346 mass shootings in the United States in 2017 alone, according to the not-for-profit organization Gun Violence Archive.
According to the Department of Homeland Security (DHS), 95 percent of active shooters do not stop shooting until someone who is armed arrives. Uniformed, off-duty police officers, or others with training in law enforcement or the military, are often good choices when it comes to armed security guards.
Screening employees/volunteers: Churches are often at the center of allegations of abuse. It is important to develop a thorough screening process for all potential workers or volunteers.
Conduct background and reference checks on anyone who will be working with children, and implement a waiting period for new members. Also, have a policy in place that requires two unrelated adults to be present with children at all times. That way, children are never left alone with one staff member or volunteer.
Emergency preparedness: It is crucial to have emergency plans of action, in the event that your church is the target of a violent crime. Church members should be informed that there are security measures in place. Further, they should be advised on what to do if there is a crisis.
DHS recommends forming a collaborative planning team to address safety risks, determine goals and objectives, and implement and maintain emergency operations plans.
For more information on how to keep your church secure, contact The MacMain, Connell & Leinhauser by filling out an online inquiry or calling us at 484-318-7106. From our office in West Chester, our experienced attorneys serve clients throughout Chester County and Philadelphia.