Hidden Dangers of Negligent Entrustment in Nuclear Verdicts

In recent years, the term “nuclear verdict” has become a growing concern in industries where loss control, equipment, and public risk intersect. This is especially true in transportation, construction, and field services like HVAC and plumbing.

Nuclear verdicts are defined as jury awards that exceed $10 million and can often be driven by emotional outrage rather than factual damages. One of the most common triggers? Negligent entrustment.

What is negligent entrustment?

Negligent entrustment occurs when a business or individual knowingly allows someone unfit or unqualified to operate a 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 company hires a technician with a suspended license and puts them behind the wheel of a company vehicle. If that technician causes a fatal accident, it’s not just the driver who is liable – the driver’s employer would as well. Why 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 a bad hiring decision. 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, businesses can shield themselves from both incidents and litigation.

Here’s how:

1. Verify before you entrust
   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.
2. 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.
3. 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.
4. 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.
5. 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. The Miller Group’s Risk Solutions team is here to help you get started.