By: Brandon Seidl, The Miller Group
In recent years, the term “nuclear verdict” has become a growing concern for companies across all sectors, especially those where safety and risk to the public or employees intersect. This is especially true in construction, where heavy machinery and high-risk environments are common.
In construction, “negligent entrustment” is a serious liability that can’t be ignored. Whether it’s giving a dump truck to a driver with a DUI or letting a worker use a power tool without training, your company is accountable for misplaced trust. Failing to verify, oversee, or enforce proper procedures can lead to major accidents. In court, juries focus not just on what happened, but whether it could have been prevented—making negligent entrustment a key factor in costly verdicts.
What is negligent entrustment?
Negligent entrustment occurs when a business or individual knowingly allows someone unfit or unqualified to operate a CDL vehicle or piece of equipment, and that person ends up causing harm. Legally, the entruster (e.g., the employer) is held liable because they should have known the person was a risk.
Consider this scenario: A construction company hires a crane operator with a suspended license and allows them to operate the crane on a busy job site. If that operator causes a fatal accident, it’s not only the operator who is liable – the employer would be as well. How is this possible? Because the company failed to exercise reasonable oversight in assigning that responsibility.
How does it lead to nuclear verdicts?
Juries often deliver nuclear verdicts when they believe a tragedy could have been easily prevented. When internal records or testimony reveal that a company ignored obvious red flags, such as a poor driving record, a history of substance abuse, or lack of proper training, jurors may respond with large punitive damages designed to “send a message.” And that message is clear: Safety and loss control negligence, especially when systemic or deliberate, won’t be tolerated.
In these cases, the actual damages (medical costs, lost income, etc.) might total a few hundred thousand dollars. But punitive damages—awarded as punishment—can soar into the tens of millions if jurors feel the company acted with indifference to human safety.
Hidden costs of poor safety culture
Negligent entrustment cases expose more than just bad hiring decisions. They can also uncover weaknesses in a company’s entire safety and loss control system.
Red flags often include:
- Inadequate background checks or credential verification
- Failure to enforce license requirements
- Lack of documented training or supervision
- Allowing equipment use despite safety violations or substance abuse
Strengthen safety and loss control
Fortunately, negligent entrustment is a preventable risk. With strong safety protocols and loss control measures, construction businesses can shield themselves from both incidents and litigation.
Here’s how:
- Verify before you trust
Always confirm qualifications, licenses, and past behavior before assigning high-risk responsibilities. Run annual motor vehicle and background checks, not just at the time of hire.
- Document training and competency
Ensure every employee is properly trained for all their job functions and keep detailed records showing who was trained, when, and on what equipment or procedures.
- Enforce a zero-tolerance policy
When employees violate safety protocols or pose a risk due to behavior, act swiftly. Allowing them to continue working with heavy machinery or operate vehicles can be used as evidence of indifference.
- Conduct routine safety audits
Spot check drivers, field workers, and equipment users. Look for signs of unsafe practices and correct them before they become incidents.
- Promote a culture of accountability
Encourage employees to speak up when they see unsafe behavior or situations. Empower managers to intervene without delay.
Negligent entrustment is more than a legal term – it’s a leadership issue. It reflects whether a company truly puts safety first or just says it does. In an age of rising nuclear verdicts, juries are no longer forgiving when the answer is the latter.
The good news? A proactive approach to safety, training, and accountability not only protects people but also protects your organization from any unforeseen liability. If you need help getting started, reach out to your risk management broker or The Miller Group.
About the Author
Brandon Seidl, The Miller Group’s loss control consultant, has more than 20 years of experience in the health and safety industry. Brandon works closely with clients of The Miller Group to analyze loss control policies and job site safety, and he also assists with the development, implementation, and management of safety programs. He specializes in risk management, loss control, and occupational health and safety.
