Celebrate Safely: How to Minimize the Liability Risks of Office Parties

With a thoughtful approach to creating written guidelines and modeling appropriate professional behavior, employers can create an atmosphere that is both celebratory and safe for all.

After months of gatherings being canceled, postponed or modified, many are eagerly anticipating this season’s holiday celebrations. Considerations for protecting participants from COVID-19 are most likely at the forefront of your mind when selecting the venue, date and even the menu for any seasonal event this year. With so much effort presently going to COVID risk mitigation, it’s understandable that you may overlook some of the potential risks that office celebrations may pose to the well-being of your practice.

Participation, employee dynamics and labor laws all come into play when planning an office party.  The Dentists Insurance Company advises employers to establish clear guidelines when organizing any work-related event. If care isn’t taken, practice owners can be held liable for misconduct.

Alcohol and holiday parties often go hand in hand. But providing alcohol to employees — even after hours and away from the office — can be a cause for a liability claim. If an employer invites most or all employees to a hosted social event and attendance is mandatory or highly encouraged, the event can be considered an employment function. Because alcohol reduces inhibitions, remarks and behaviors can easily turn inappropriate. Allowing an event to become too casual and unprofessional can set the stage for a harassment claim.

Before you deck the halls, remember that harassment and antidiscrimination policies still apply

In one case reported to TDIC, a dentist hosted a holiday party at his house. Toward the end of the night, the dentist, who appeared to be intoxicated, allegedly approached an employee and made an inappropriate advance. The employee pushed him away and abruptly left his house in tears. She later stated that the dentist had expressed he wanted to date her and made comments about her personal life. She stopped showing up for work and hired an attorney.

In another case, a dentist took his staff out for drinks in celebration of the holidays. Afterwards, his office manager and hygienist went out to a bar. The office manager alleged that the hygienist made a pass at her. The office manager quit a month later and hired an attorney. In both cases, there were five-figure settlement demands.

TDIC reminds employers that standard harassment, antidiscrimination and workers’ compensation policies apply at company-sponsored events. Employers can be, and have been, held liable for their employees' behavior regardless of when or where it occurred. Celebrating off-site or after hours does not negate the responsibilities of an employer. Employers can also be held liable if an employee drives under the influence and causes an accident following a work-sponsored event.

In response, many employers have considered eliminating holiday parties altogether. Executive outplacement firm Challenger, Gray and Christmas Inc. annually surveys companies regarding holiday party plans. In years prior to the COVID-19 pandemic, the number of companies hosting holiday parties was already declining. Last year, the firm noted that 74% of those companies celebrating the holidays planned to do so virtually, utilizing technology. This year, uncertainty is a common factor among those considering office celebrations.

Celebrate your employees safely this season

Despite noting the difficulties of hosting holiday gatherings due to liability and ongoing COVID risks, Andrew Challenger, vice president of Challenger, Gray and Christmas Inc., acknowledges that office parties can be beneficial. “Of those who are employed, many may be experiencing survivor syndrome or are dealing with other energy- and morale-sapping issues at home. It is imperative that companies look for ways to celebrate their employees,” said Challenger. “One way to create a safer environment is to limit the guest list, hold the party during the workday and avoid serving alcohol.” 

Employers should also consider and adhere to applicable overtime rules and rest periods when hosting office celebrations. If a celebration is held during work hours, meal and rest periods are required as per usual. If held after hours and attendance is mandatory, overtime rules apply.  TDIC recommends employers consider allowing their employees who are attending a party in the evening on a workday to leave work early.

In addition, employers should establish clear guidelines and expectations regarding office celebrations.  With appropriate guidance, everyone involved is more likely to maintain a professional demeanor. One option is to send out a friendly reminder to staff reiterating that office policies and standards apply to holiday events and that the office maintains a zero-tolerance policy for harassment.

Spread holiday cheer evenly to avoid perceptions of favoritism

Gift-giving at any time of year should be approached with thoughtful caution. Even when employers and employees are trying to make a kind holiday gesture, unintended consequences can result. To avoid any perceptions of favoritism or discrimination, all holiday gifts should be appropriate in nature and remain consistent in value. TDIC Risk Management analysts advise employers to treat all employees the same when it comes to gifting. By including everyone, employers can help maintain positive office morale and avoid conflict.

The best action employers can take is to include an office policy in their employee manuals, citing specific examples of unprofessional and unacceptable behavior as well as examples of respectful behavior and professional conduct. With unacceptable actions clearly defined, everyone in the office will be less likely to cross the line during holiday events and throughout the rest of the year.

Though holiday events can and should be celebratory and fun, maintaining professionalism among all attendees is still a must. It’s important for practice owners to remember that they are employers first, not friends of employees. Allowing an atmosphere to become too casual introduces the risk of inappropriate comments and unprofessional behavior into workplace events.

Ideally, practice owners should not have to start the new year correcting mistakes of the past. By taking a few precautionary measures, it is possible to curb risk while wrapping up 2021 with joy.

TDIC’s Risk Management Advice Line is a benefit to TDIC policyholders. To schedule a consultation with an experienced risk management analyst, visit tdicinsurance.com/RMconsult or call 877.269.8844.