Can employers enforce liability waivers against former employees injured outside of work? Deer Valley Resort v. Olson Explained

In Deer Valley Resort v. Olson, the Utah Supreme Court addressed the enforceability of liability waivers signed by employees when injuries occur outside the scope of employment. The case involved two former Deer Valley employees who were injured in a snowmobile accident after being laid off due to COVID-19.

Background and Facts: William Olson and Lark Pyper worked as lift operators at Deer Valley Resort during the 2019-2020 ski season. As part of their employment, they signed liability waivers releasing Deer Valley from claims arising from “activities” on resort property, including those caused by Deer Valley’s negligence. After being laid off in March 2020, they returned to retrieve uniforms and joined other terminated employees for a St. Patrick’s Day gathering on the mountain. A current employee gave them a ride on a Deer Valley snowmobile, crashed, and both were seriously injured.

Key Legal Issues: The case presented two primary questions: (1) whether Deer Valley could be held vicariously liable under respondeat superior for the employee’s negligence, and (2) whether the liability waivers barred direct negligence claims against Deer Valley under Pugmire v. Oregon Short Line Railroad Co.

Court’s Analysis and Holding: The court affirmed dismissal of the vicarious liability claims, finding insufficient evidence that the employee was acting within the scope of employment when providing the ride. The employee testified he acted purely to “help friends out” and knew he was violating company policy. However, the court reversed on the direct liability claims. The court confined Pugmire’s holding—that employer-employee liability waivers are void as against public policy—to work-related injuries only, not injuries occurring outside of employment like those suffered by these former employees.

Practice Implications: This decision clarifies the limited scope of Pugmire and strengthens the enforceability of liability waivers for off-duty activities. Practitioners should carefully analyze whether injuries occurred during work-related activities when challenging such waivers. The decision also reinforces the strict requirements for establishing scope of employment in vicarious liability claims, requiring evidence that the employee was motivated, at least in part, to serve the employer’s interests.