Reducing Liability Around Holiday Parties

Tis the season for employees to eat, drink, and act inappropriately at holiday parties. Holiday parties can help motivate employees and serve as a thank you for their hard work all year; however, we often see bad behavior by employees. Depending on the circumstances, your company may find itself potentially liable for an employee’s inappropriate or unlawful actions at your company sponsored party. You can help minimize the risks associated with holiday parties by planning and following some useful tips.

1. Avoid or Limit Alcohol

After serving alcohol at a company sponsored event, there is the possibility that an employer could end up liable for injuries or damages caused by an inebriated employee. There are the risks of someone getting hurt or driving under the influence and there are also serious concerns if an employee’s behavior crosses the line from embarrassing to unlawful such as sexual harassment or violence. If you do serve alcohol at the party, you can take steps to limit alcohol consumption. You can provide drink tickets to employees, close the bar well before the party ends, serve plenty of food and non-alcoholic beverages, and use professional bartenders and staff who can keep their eyes open for obviously drunk employees. You can also designate some managers to refrain from drinking alcohol to make sure things do not get out of hand.

2. Keep Harassing Behavior in Check

Make sure that your sexual harassment policy is up-to-date and that it applies to company sponsored events, even if held off company property. Consider making the event a family party where employees may bring their spouse or a significant other as the presence of family members often deters inappropriate behavior which could give rise to a harassment complaint. Ask your managers to watch for potentially harassing conduct and to intervene as necessary.

3. Respect Religious Differences by Keeping Your Party Neutral

Avoid giving the impression that you are favoring one religious group over another by sticking with the neutral Holiday Party name and using non-religious decorations. Be sure that the timing of the party does not exclude any employees for religious reasons.

4. Avoid Employee Gift Exchanges

Gift exchanges between employees may have potential issues. Employees may not be able to afford to participate, even within a recommended cost guideline. Some employees may give sexy or what they feel are funny gifts that end up offending others. The best practice could be to avoid a company sponsored gift exchange altogether.

5. Remember Wage and Hour Laws

If you assign any non-exempt employees to plan, prepare for, and work at the party, their hours are likely work hours for which they must be paid. Clearly convey to all employees that attendance at the party is optional and clarify that employees will not be compensated for attending the party, especially if the party is on company property after hours.

6. Address Any Problems

Even if you follow every piece of advice here, and from other sources, issues may still arise. If you receive a complaint from an employee related to the party, make sure to respond to it and perform a thorough investigation, just as you would for complaints that occur during normal working hours.

If you are worried that your holiday party will be more stressful than festive, we can help. Please contact your The O’Connor Group HR Consultant or Suzi Tropiano at