Many employers wish to host a holiday party for their employees to boost morale and to thank them for their contributions during the year. Employers should be mindful, however, that the combination of alcohol and holiday cheer may lead to unanticipated problems. Typically, these problems involve alcohol consumption and sexual harassment, and in some cases, one leads to the other.

Sexual Harassment

In a holiday party environment, especially if alcohol is served, employees may be more likely to let down their guard and do or say things they would not in an office setting. Although most party conversation will not likely rise to the level of actionable harassment, offensive comments and jokes and unwelcome touching and sexual advances are more likely to occur at an office party and may result in an internal complaint. Employers are wise to recognize this possibility and take the opportunity to reinforce any existing anti-harassment policies they have in place. Indeed, it is a good idea to circulate the anti-harassment policy several days prior to the party to remind employees of the need to act responsibly. Employers also should be vigilant in monitoring the conduct of their employees at the party and ensure that any inappropriate conduct or complaints of harassment are addressed promptly.

Alcohol Consumption

The decision to offer alcohol at an office-sponsored holiday party is one that should be made carefully. In some states, an employer may avoid being held liable for torts committed by employees who become intoxicated at an office-sponsored party under a “social host” theory. Thus, an employer should take specific steps to ensure they are categorized as a social host by making an effort to demonstrate that the holiday party is not a work-related event, but rather a purely social occasion. Among other things, employers are advised (1) not to require attendance; (2) not to compensate employees for their time at the party; (3) not to invite clients (to prevent the perception that the party furthers the employer’s business interests); and (4) not to encourage alcohol consumption.

Tips for Employers

The following suggestions can help an employer avoid liability while still providing a fun, festive event for employees:

  • Circulate your sexual harassment policy several days before the event to make sure employees understand their responsibilities.
  • Make the holiday party a social event, not a business event. Do not invite clients or conduct business at the party.
  • If you choose to serve alcohol, take steps to ensure your employees practice moderation. These steps should include offering a variety of food and non-alcoholic beverages, closing the bar at least one hour before the party ends, and ensuring that your bartender understands the relevant state laws.
  • Rather than having an open bar, consider giving your employees a fixed number of drink tickets to limit alcohol consumption.
  • Provide your employees with alternative modes of transportation by encouraging and rewarding designated drivers, setting up a shuttle system, or providing employees with taxi vouchers.