An employer is responsible at law for all the actions of his employees when acting as such – even the most idiotic actions of his most idiotic employees.

There is no point complaining about this. Viewed objectively, it is only right that an innocent customer or third party should enjoy more legal protection from the actions of an idiot than someone idiotic enough to employ that idiot in the first place.

So when Barings Bank contracted enormous debts through the recklessness of a very junior employee called Nick Leeson, Barings Bank had to assume responsibility for the debts.

Following that scandal, most banks tightened their supervision of junior employees. However, last year’s banking crisis showed that was only a superficial solution, because the debts that caused that crisis were contracted through the recklessness of senior managers, people of the highest rank with years of experience and solid reputations.

It is not just the banks. The McLaren Formula One racing team may lose tens of millions because of a bad decision made by their “Sporting Director”, sic, a man who had been with the team for thirty five years and was generally respected.

It seems that the depressing lesson for employers is that you cannot rely on anyone.

The best advice is therefore to employ no one unless absolutely necessary.

Since this puts a limit on growth that most businesses find too prohibitive, the next best advice is not to rely on tight supervision – because it can never be tight enough – but on contracts of employment that share the consequences.

The reality is that an employer is still unlikely to get much back by suing an employee who messes up, but the knowledge that he might be sued could make him slightly less likely to mess up.