We are independent & ad-supported. We may earn a commission for purchases made through our links.

Advertiser Disclosure

Our website is an independent, advertising-supported platform. We provide our content free of charge to our readers, and to keep it that way, we rely on revenue generated through advertisements and affiliate partnerships. This means that when you click on certain links on our site and make a purchase, we may earn a commission. Learn more.

How We Make Money

We sustain our operations through affiliate commissions and advertising. If you click on an affiliate link and make a purchase, we may receive a commission from the merchant at no additional cost to you. We also display advertisements on our website, which help generate revenue to support our work and keep our content free for readers. Our editorial team operates independently from our advertising and affiliate partnerships to ensure that our content remains unbiased and focused on providing you with the best information and recommendations based on thorough research and honest evaluations. To remain transparent, we’ve provided a list of our current affiliate partners here.

What is Enterprise Liability?

Mary McMahon
By
Updated May 17, 2024
Our promise to you
WiseGeek is dedicated to creating trustworthy, high-quality content that always prioritizes transparency, integrity, and inclusivity above all else. Our ensure that our content creation and review process includes rigorous fact-checking, evidence-based, and continual updates to ensure accuracy and reliability.

Our Promise to you

Founded in 2002, our company has been a trusted resource for readers seeking informative and engaging content. Our dedication to quality remains unwavering—and will never change. We follow a strict editorial policy, ensuring that our content is authored by highly qualified professionals and edited by subject matter experts. This guarantees that everything we publish is objective, accurate, and trustworthy.

Over the years, we've refined our approach to cover a wide range of topics, providing readers with reliable and practical advice to enhance their knowledge and skills. That's why millions of readers turn to us each year. Join us in celebrating the joy of learning, guided by standards you can trust.

Editorial Standards

At WiseGeek, we are committed to creating content that you can trust. Our editorial process is designed to ensure that every piece of content we publish is accurate, reliable, and informative.

Our team of experienced writers and editors follows a strict set of guidelines to ensure the highest quality content. We conduct thorough research, fact-check all information, and rely on credible sources to back up our claims. Our content is reviewed by subject matter experts to ensure accuracy and clarity.

We believe in transparency and maintain editorial independence from our advertisers. Our team does not receive direct compensation from advertisers, allowing us to create unbiased content that prioritizes your interests.

Enterprise liability is an area of the law allowing for joint liability in cases where industry practices known to be potentially unsafe are involved. This allows people to recover damages from entities involved in the practices in question, even if they don't directly engage in them. In a simple example, if a company spins off a subsidiary and maintains the assets with the parent company, a person can sue the subsidiary and parent company together to collect damages. This legal doctrine has its origins in the industrial revolution.

One important aspect of enterprise liability is the concept of no-fault liability. In most cases, to collect damages, people must be able to show legal causation and demonstrate that the party being sued is at fault. If fault can't be proved, the case will be ruled in favor of the defendant. With enterprise liability, people do not need to directly prove fault. Thus, workers suing for damages related to working in a dangerous industry can collect them even if they cannot categorically show that their injuries were caused by their work; a coal miner, for example, can sue after developing a respiratory condition, as such conditions are a known hazard of the mining industry.

Along with the no-fault liability comes the ability to sue related parties who are not directly involved, including both individuals and entities. Companies engaging in practices known to be potentially unsafe can be held liable for them even if they involve a separate department or subsidiary. This allows for the possibility of collecting very large damages even if companies attempt to isolate their more hazardous operations from their assets.

Enterprise liability covers both civil and criminal liability, allowing law enforcement to take actions against companies when their unsafe practices violate the law. Attorneys may use a variety of arguments in such cases, including documenting a history of such practices and generally known information about the industry, with the goal of demonstrating that a case meets the test of enterprise liability and the company is indeed liable.

Corporations engaging in hazardous activities use a number of means to protect themselves, including retaining very aggressive legal staffs and maintaining liability insurance to cover situations when they are brought to court. Steps are also taken to limit the risk of accidents and other issues, with the goal of preventing situations from arising in the first place, taking a proactive approach to staying out of court.

WiseGeek is dedicated to providing accurate and trustworthy information. We carefully select reputable sources and employ a rigorous fact-checking process to maintain the highest standards. To learn more about our commitment to accuracy, read our editorial process.
Mary McMahon
By Mary McMahon

Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a WiseGeek researcher and writer. Mary has a liberal arts degree from Goddard College and spends her free time reading, cooking, and exploring the great outdoors.

Discussion Comments

By starrynight — On Oct 04, 2011

@ceilingcat - I agree with you about holding the subsidiary companies responsible. However, I think the idea of no-fault liability is ridiculous.

These lawsuits should be the same as any other personal injury lawsuit. You have to prove that you suffered an injury, and that it was directly related to your work or whatever. I don't think it would be fair to make a company pay if someone developed a condition for some other reason.

I know a lot of people feel like "oh, down with big business." But in the end that just hurts our economy!

By ceilingcat — On Oct 03, 2011

I think enterprise liability is a great idea. Companies shouldn't just be able to hide their assets in their subsidiary companies to get out of paying a settlement.

I also really like the idea of no fault liability. It seem likes our legal system puts so many burdens on victims. It's nice to here for once that if the industry does things that are known to be unsafe, and someone gets hurt, they can recover damages without going through a whole big ordeal.

Mary McMahon

Mary McMahon

Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a...

Learn more
WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.

WiseGeek, in your inbox

Our latest articles, guides, and more, delivered daily.