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Don't Let Holiday Fetes Create Future Regrets
Practical Law Legal Update w-001-0086 (Approx. 5 pages)
Don't Let Holiday Fetes Create Future Regrets
by Practical Law Labor & Employment
| Law stated as of 29 Nov 2017 • USA (National/Federal) |
This Legal Update offers best practices tips for avoiding liability connected to an employer-sponsored holiday party.
This time of year means holiday parties, which can bring a workforce together and boost morale. Unfortunately, they can also bring legal trouble. Good party planning by employers means more than just food and festivities. Employers should guard against a host of potential legal pitfalls. Most notably, employers should ensure that:
- Employees are not subjected to sexual harassment. Using appropriate policies and setting the tone of the party in advance can help root out unwanted sexual advances and inappropriate activities.
- Alcohol consumption is planned and monitored appropriately. Advance planning about where the party should be held, who should be on the guest list, and who should tend the bar can promote responsible drinking and minimize employer liability under dram shop laws.
- Employees are not performing business functions, creating exposure for workers' compensation. In addition, employers can minimize workers' compensation risks by promoting a safe environment by using licensed vendors for food and other aspects of the party.
- Wage and hour risks are avoided. Employers should be sure that participation is voluntary, the party is held outside working hours, employees are not compelled to take on particular tasks, and compensable work activity is eliminated.
Employers can protect their interests by reviewing Practical Law's Holiday Party Liability Prevention Checklist. The following are select tips from the Checklist to keep alcohol-related litigation risks at bay. See the full resource for more helpful guidance.
Reduce the Risk of Alcohol-Related Accidents
- Hold the event at a restaurant or other off-site location. Employers may want to hold holiday events at establishments with a liquor license and where alcohol is served by professional bartenders who know how to respond to guests who are consuming alcohol to excess.
- Hire a professional bartender or caterer for on-site events. If the event is held on the employer's premises, the employer should consider hiring a professional bartender or caterer to serve any alcoholic beverages. The employer may want to confirm that the caterer carries liability insurance and instruct bartenders or wait staff not to serve drinks to anyone who is visibly intoxicated. Employees should not be permitted to stand in as bartenders or otherwise serve drinks to coworkers.
- Limit the amount of alcohol that will be served. Employers may try to control alcohol consumption by:
- providing a limited number of drink tickets or limiting the time during which alcohol will be served;
- providing entertainment to shift the focus of the event away from alcohol to something else; and
- making a variety of non-alcoholic beverages and food available as alternatives to alcoholic beverages.
- Provide alternative transportation. Employers should consider providing transportation for employees leaving employer-sponsored events where alcohol is served.
- Encourage employees to look out for intoxicated coworkers. Employers should:
- encourage employees to notify management if another employee appears overly intoxicated; and
- consider designating certain employees as "spotters" to look out for colleagues who may have had too much to drink, but be sure not to designate employees who may be nonexempt under the FLSA to avoid claims that they were required to work off the clock and therefore are entitled to additional compensation (see Holiday Party Liability Prevention Checklist: Prevent Wage and Hour Claims by Nonexempt Employees).
- Determine whether the employer is insured. Employers may purchase insurance covering dram shop or liquor law liability in states that recognize those causes of action. Employers should review their existing coverage before purchasing a new policy because a comprehensive general liability policy may provide sufficient coverage.