By Patricia Nemeth
and Kellen Myers
Dec. 13, 2012
The holiday season is a joyous time often used by employers as an opportunity to thank employees for their contributions and to celebrate the season by hosting a holiday party. A recent national poll of U.S. companies found that 91 percent of those surveyed plan on hosting a holiday party for their employees this year. This number is up from 2011, when 74 percent of companies hosted a holiday party due, in part, to the perception that the economy is improving. While it’s good to see the celebratory mood of employers continue to rise, a holiday party can become a liability nightmare for an employer if not planned and administered properly. Following are some of the more (and less) obvious factors to consider when planning a holiday party.
Alcohol - Serving and Consumption
An employer needs to consider whether, or how, to serve alcohol. The most conservative approach is to prohibit the consumption of alcohol at the event. While this may be the easiest way to limit liability, the festive atmosphere the employer is trying to create will certainly suffer. As a compromise, employers may want to consider the following options:
- Hire an outside bartender to serve and bring the alcohol. Businesses that offer this service should already know how to strictly follow dram shop and alcohol liability laws. This may reduce the headache for employers and supervisors worrying about monitoring underage drinking or continued service to clearly intoxicated guests. Employers can also provide the hired bartender or service with written rules to follow to limit potential liability.
- Hold the holiday party offsite at a conference center or other similar establishment. Not only would this cover issues related to alcohol service, but businesses engaged in holding social business functions generally will have an insurance policy covering any potential liability. Employers should determine what policy is in place prior to securing a location for the party.
- Establish a policy that is clearly communicated to management and employees emphasizing moderation and good judgment. Such a policy will remind employees that even though it’s a holiday party, the event is still a business function. As such, any inappropriate behavior can result in discipline.
Numerous issues can arise during holiday parties, but none may be more costly (or more prevalent) than inappropriate sexual banter and behavior. As employees relax and imbibe, they become more casual in their speech and conduct. Unfortunately, these behaviors can, at times, cross the line. As aptly stated by a Court of Appeals opinion, “[at] the risk of playing the Grinch, however, we note that office Christmas parties also seem to be fertile ground for unwanted sexual overtures that lead to [discrimination] complaints.” Place v. Abbott Laboratories, 215 F.3d 803 (7th Cir. 2000). Therefore, employers should make sure employees and management are aware that any and all harassment and discrimination policies are still in effect at the holiday party. Employers should adhere to existing policies and enforce such policies during holiday parties or any other social business function.
In order to avoid potential religious discrimination claims, employers must remember Christmas is not the only holiday celebrated in December. Employers must make sure the event is generically named and abstain from religious decor or mention. Consider placing the focus on celebrating business successes or events that have occurred in the past year.
Tips for a Fun and Safe Holiday Party
- Address alcohol related concerns. Plan for any potential liability issues and determine insurance coverage if necessary. If an employee or guest does get out of control, ensure the person has a safe way home so that his/her life and other lives on the road are not placed in jeopardy.
- Alleged harassment at a holiday event is just as much a cause for concern as during a normal workday. Adhere to all policies and make sure employees and supervisors are aware of their application.
- Refrain from showing favoritism in presenting awards or gifts to employees.
- If the holiday party revolves around a particular activity, determine whether waivers may be required (e.g., indoor go-kart racing).
- Hold the event outside of normal working hours and at a different location. An event held during normal work hours is more likely to be considered directly related to work for liability purposes. Emphasize that attendance is voluntary and the event is purely social (i.e., not work related).
- Designate an event coordinator to keep the party running smoothly and address any unforeseen problems (including intoxicated or impaired employees).
Many of the issues that may arise during a holiday party are issues employers may encounter on a regular basis. Use existing policies and take extra time to consider potential liability issues to keep your holiday party safe and problem free. Last, but not least, enjoy the party!
Patricia Nemeth is the founding partner at Nemeth Burwell, P.C., which specializes in employment litigation, traditional labor law and management consultation for private and public sector employers. Nemeth can be reached at [email protected]. Kellen Myers is an associate attorney and can be reached at [email protected].