'Party Time' found at https://flic.kr/p/ihruT3 by Nanagyei (https://flickr.com/people/nanagyei) used under Creative Commons Attribution License (http://creativecommons.org/licenses/by/2.0/)
'Party Time' found at https://flic.kr/p/ihruT3 by Nanagyei (https://flickr.com/people/nanagyei) used under Creative Commons Attribution License (http://creativecommons.org/licenses/by/2.0/)
'Party Time' found at https://flic.kr/p/ihruT3 by Nanagyei (https://flickr.com/people/nanagyei) used under Creative Commons Attribution License (http://creativecommons.org/licenses/by/2.0/)

Your company holiday party comes with potential legal liability.  While you can never eliminate all potential liability, you can minimize your risk.  Here are some ways to do that:

1.Don't Serve Alcohol.

If you must have alcohol at your party, do yourself a favor and do not serve alcohol yourself.  Either have a professional caterer who is properly trained, licensed and insured (and ideally, who will indemnify you or name you as an additional insured), or go to a bar or restaurant.  Consider providing employees with a limited number of drink tickets.  

2. Remind Employees to Be Safe and Behave Property.

Remind employees beforehand of company expectations and that people consuming alcohol should have a designated driver.  Offer to pay for rides home, no questions asked.  In the era of Uber and Lyft, there should be plenty of rides available in most areas.  Remind and expect the management team to lead by example.

Sexual harassment is also a major concern for office holiday parties.  Gently remind employees of company policies prior to the party.  

3. Set High Expectations for Managers and Supervisors.

Your first lines of defense are the company supervisors.  Recruit them to look out for employees who are drinking too much.

Remind them also that they lead by example.  If Sales Manager Bob is on his sixth triple IPA and telling dirty jokes, some in his sales team will follow his lead.  In Massachusetts, there is strict liability when a supervisor sexually harasses a subordinate.  If you can't trust your managers and supervisors, then you have a big problem.  If you haven’t provided sexual harassment training to managers recently, here is your excuse to do so.

4. Check with Your Insurer.

The end of the year is as good of a time as any to review your insurance coverage with your broker.  If you don't have a good broker who will take your call and answer your questions, find one who will.  Insurance is complicated and gaps in coverage are more common than business owners may think.  Checking your various policies for a holiday party will also serve as a good year-end check.

5. Remind People that it is a Party and they Can Have Fun.

The key here is to make it clear that the party is voluntary.  No one is going to get paid wages, so no one has to attend.  Hold the party when employees are not working.  You do not want any claims of failing to pay wages or overtime.  Don't require any employees to perform any duties, such as checking coats or tending bar, which could be viewed as work requiring pay.  This may also prevent a worker's compensation claim if someone is hurt at the party (check with your insurance broker).

If you have any questions about dealing with liability issues for an open house or company party, call me at 617.338.7000. As always, the above is general information, not legal advice.