While these parties are a time for coworkers to let loose, holiday parties can sometimes increase an employer’s anxiety level. Employees tend to throw inhibition to the wind, consume larger than normal amounts of alcohol and encounter situations typically not found during the workday.
Sometimes an employee may act in a way that puts himself or others in harm’s way, begging the question of whether an employer is liable for the actions of one of its employees. Fortunately, an employer will not typically be liable for an employee’s recreational activities, but that doesn’t mean an employer should throw caution to the wind.
An employee who overindulges can create a lot of problems. For example, an overindulgent employee could get behind the wheel of a car. The employee could also injure himself or another employee as a result of having drunk just a little too much. We all know the risks of alcohol consumption, but a holiday party can put a target on the employer’s back if something goes wrong as a result of overindulgence. However, a holiday party doesn’t mean the employer is liable for everything its employees do post-party.
An employer’s liability for employee negligence depends on whether the employee is within the course and scope of employment. An employee is typically within the course and scope of employment when his actions are so closely connected in time, place and causation to his job duties that the actions fall within the type of harm fairly attributable to the employer’s business, as compared with conduct motivated by purely personal considerations entirely outside the employer’s business duties. This means that the employee is typically acting on the employer’s behalf, doing what he typically does for the employer or under the employer’s direction.
Holiday parties generally fall outside of the course and scope of employment as a social event, but some employers still face lawsuits. Courts typically find holiday parties are not associated with the employer’s business, but some courts have found an employer-sponsored party could fall within the course and scope of employment.
If the party is mandatory, courts would be more likely to find attendance was within the course and scope of employment. For example, a supervisor’s statement to his subordinates that he expected the subordinates to attend the holiday party has been deemed a mandatory work event. Also, a party taking place on the employer’s premises is another factor in favor of the party falling within the course and scope of employment. Courts will also look at whether the party took place during work hours. A midday holiday party is more likely to fall within the course and scope of employment. These are all factors an employer should consider when planning a holiday party.
Just because an employer isn’t typically liable doesn’t mean that people won’t try and hold an employer liable. While the chances of liability are in the employer’s favor, an employer should take the following steps to further mitigate those risks and protect its employees. Don’t make attendance mandatory, but rather treat it as a true social affair. Encourage employees to not drink and drive, perhaps by choosing a location with available public transportation or encouraging employees to stay in hotel rooms and/or providing gift cards for taxi cabs. Limit the amount and types of alcohol available so that an employee can’t truly abuse the potential of an open bar. Voice encouragement to drink responsibly, whether driving or not.
Finally, the employer should designate a few individuals to monitor the event to foresee any potential problems, such as sending employees that may have had too much to drink home in cabs. These steps can make sure an employee’s good time doesn’t turn into a headache for the employer.
Andrew Baer is an associate at Deutsch Kerrigan LLP in New Orleans specializing in employment law, professional liability and commercial litigation.