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Tuesday, May 31, 2016

UK High Court: Employers Vicariously Liable for Data Breaches

Ruling in April in in Axon v Ministry of Defence, the High Court of England and Wales found that employers can be liable for data breaches caused by rogue employees.  The case involved a MoD employee who received compensation for passing on information about a Royal Navy frigate commander’s sacking to journalists without the permission of her employer.  Although the charges against the employer were dismissed on other grounds, the court parenthetically concluded that had the claimant had a valid claim, the MoD would have been vicariously liable for any damages arising out of its employee’s wrongdoing.  The decision underscores the need for employers to have data protection policies, programs and training in place to guard against inappropriate actions by employees who have access to sensitive personal information.

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