A common way for employers to boost employee morale is to host various recreational activities, including on-site basketball games, sports leagues, competitions and parties. Unfortunately, the potential for workers’ compensation liability for injuries occurring during these events too often discourages employers from providing these activities. But this does not need to be the case.
In many states, a list of common factors demonstrates whether an injury sustained during an employer-sponsored recreational event will be compensable. Knowing and understanding these common factors is the first step toward offering these recreational opportunities to your employees without the threat of injury claims.
The common factors are:
Whether employee participation is voluntary;
Whether the employer derived a direct and substantial benefit from the activity;
Whether the activity occurred on the employer's premises;
Whether the activity occurred during regular business hours; and
The extent of the employer's financing and/or control of the activity.
The most important of these factors, by and large, is whether attendance or participation is voluntary. "Voluntary" means there cannot be either explicit or implicit compulsion. Some states even provide a form for your employees to sign indicating they understand the activity to be voluntary and, thereby, waive all rights to workers’ compensation.