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What is Negligent Entrustment and How Can Trucking Companies Avoid It?

What is Negligent Entrustment and How Can Trucking Companies Avoid It?

It doesn’t matter whether your fleet has five trucks or five hundred trucks, negligent entrustment represents an existential threat to trucking companies should they get caught up in it as a result of poor decision-making. If you are a trucking executive, it is likely you are already well-versed in the concepts and liabilities associated with the industry you make a living in.

It doesn’t matter whether you are an LTL operator or a refuse fleet, you want to maintain an impeccable safety record. So many different industries are governed by safety and compliance concerns. Yet, why is it that truck driver safety is so often an overlooked risk gap? You could be at risk for negligent entrustment if one of your truck drivers is involved in an accident, and that is just the fact of the matter.

Many companies, whether they operate in the trucking sector or not, fail to realize that they have a duty to care for everyone they interact with. If someone slips and falls at a grocery store, they could be liable in a lawsuit because they did not adequately care for the safety of those patronizing their business. But we aren’t talking about grocery stores here, we are talking about trucking companies.

The In’s and Out’s of Negligent Entrustment

Negligent entrustment occurs when a vehicle – or any other dangerous “article” – is entrusted to somebody and through their reckless behavior, an accident happens. This could also include a lack of experience or incompetence. In order to find out who is at fault in this situation, should a lawsuit occur, the plaintiff must show the following:

  • The company entrusted the vehicle in question to the truck driver.
  • The truck driver was reckless, incompetent or unlicensed.
  • The company knew the truck driver was reckless, incompetent or unlicensed.
  • The company should have known the truck driver was reckless, incompetent or unlicensed.

Once these criteria have been met, the plaintiff must only prove that the truck driver was negligent while operating the commercial motor vehicle and that the negligence resulted in injury or damage. Consider these mind-blowing statistics next time you are wondering if negligent entrustment impacts you:

  • The cost of motor vehicle accidents to employers in 2017 was $56 billion.
  • The percentage of vehicle accidents that caused employees to miss work was 53%.
  • The cost of out-of-service vehicles to fleets per vehicle/day was $760.
  • The average cost of property damage per accident was $21,000.
  • The average cost of a single injury was $387,0000.
  • The average cost of an accident with a single fatality was $8.4 million.
  • 20% of company drivers are responsible for over 80% of the company’s risk profile.

These are not small or insignificant numbers. Now, the key issues for company leaders and executives is to figure out where the responsibility lies, and if they are doing everything they can to ensure that it doesn’t push their company to the brink of insolvency. Is your fleet doing all it can to ensure this scenario does not put your company in imminent danger? You could be looking at millions of dollars in losses if not.

It is About More Than the Truck Driver

Consider this: Negligent entrustment is about more than just someone driving a company car. The individual could also be using their own passenger vehicle to carry out the work. A restaurant employee delivering a pizza puts his or her company at risk if there is an accident on the road while they are performing a work function.

Also consider that a company is liable even if they have performed a background check on the truck driver. Where the law is concerned, a company can still be held responsible if the operator’s status changes while they are employed within the company. Why? Because it is up to the company to ensure that they are up to date on the driving records for those in their employ, at least if they are operating a company vehicle.

Where negligent entrustment is concerned, every company that employs a driver is at risk. All companies, whether it be a grocery store or pharmaceutical company, is at risk. Even more, negligent entrustment cases often result in significant payouts. Why? Because a jury will often view a trucking company as having deep pockets, even if it isn’t true, and multi-million-dollar settlements are often the result.

There are many examples of where negligent entrustment has crippled motor carriers. In one example, a moving company’s truck tragically hit an elderly woman walking in the common area of an apartment complex. The woman’s son ended up suing the company and since the company put a risky truck driver on the road without the correct license and training, the case ended up costing the moving company $825,000.

In another example, a company was unaware that one of its truck drivers had been operating their vehicle on a suspended license for five months. This is really an inexcusable overlook. What happened? After putting in 100 hours in one week, the truck driver got into an accident while chatting on his phone. The accident resulted in lifelong injuries and the company winded up paying out $3.6 million in damages.

What You Can do to Protect Yourself

So, what is an organization to do to protect itself from negligent entrustment? Quite frankly, this is a critical responsibility of the organization’s leadership. While most companies regularly screen truck drivers when they are hired, more must be done to avoid negligent entrustment. We have previously discussed the need to be continually monitoring your truck drivers’ MVR.

If you don’t know what is going on with your truck drivers’ licensing and motor vehicle records, you will have a huge gap in your risk profile. You will essentially be blind to the big picture surrounding the qualifications of your truck drivers. It is also important to note that you should never solely rely on self-reporting. In fact, if a fleet were to try to use self-reporting in a case, it would not hold up. Both juries and judges will have a higher expectation of those at the top.

There are plenty of tools out there to help fleets properly manage and supervise the status of their employees. Whether it be continuous MVR or license monitoring, database updates, or otherwise, companies who want to avoid negligent entrustment issues know where to invest. Ensuring you are aware of the status of your people should be a vital part of a continuous, company-wide safety effort.

Comprehensive solutions should offer a suite of different capabilities. They should include features like:

  • CONTINUOUS MVR MONITORING: Get real-time updates when changes occur to your employees’ Motor Vehicle Records (MVRs), like DUIs or Suspensions.
  • MOTOR VEHICLE RECORDS: Instant electronic MVRs from all 50 states and color-codes each report based on the level of attention needed.
  • DRIVER INFORMATION MANAGEMENT: Keeping track of drivers’ licenses, medical certificate expiration dates and all other DOT files in one easy to use system.

You want to go with a solution that closes the gap between MVR reporting times while also allowing you to streamline your truck driver review process. Not only is this critical for safety, but it helps keep your insurance low and protects against litigation.

Features like real-time email alerts allow fleet managers to monitor MVR records on a regular basis. If there is a change to the record, the fleet will be notified. These alerts should be able to sync up with a back-end database so that the fleet can streamline or eliminate a cumbersome manual review process. A secure and robust system should be active and available 24/7.

Once you put your truck drivers’ MVRs into the system, the system should run reports automatically at time intervals of your choosing. This prevents you from getting bogged down in manual administrative processes. Smart systems will link up to state licensing agencies and obtain the most up-to-date truck driver information without you having to do a thing.

Motor vehicle records are then ordered online and delivered through an intuitive online portal. Web-based applications provide the easiest solution, as they do not need to be integrated with existing fleet management tools. This reduces the time, effort, and expense related to keeping track of your truck drivers and their records.

The fact is this: If you want to avoid negligent entrustment, you must know what is going on with your truck drivers at all times. And with so many tools on the market to help you do just that, judges and juries will be quick to strike down hollow excuses. Know what your truck drivers are up to and help keep the roadways safe. Everyone benefits in this scenario.

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