It’s that time of year again. Company-sponsored social events will soon be in full swing. Just in time, a recent North Carolina Court of Appeals decision provides good guidance on employers’ responsibilities for employees’ injuries suffered after leaving an employer-sponsored social event.
John Graven and Kathryn Wall, two employees of the State Highway Patrol (“SHP”), attended their employer’s holiday lunch at a public restaurant about a half-hour drive from the workplace. The December 16, 2010, luncheon was to celebrate workplace accomplishments. Employees’ attendance at the luncheon was voluntary and fewer than half of the SHP’s employees who were invited actually attended. Although three supervisors made brief remarks thanking employees for their dedication, no formal speeches were given and no awards were presented during the event.
After the lunch, Graven and Wall were riding back to the SHP office on a public street in a state-owned vehicle when the vehicle struck a tree. Both employees were injured as a result of the accident and each subsequently made claims for workers’ compensation benefits.
The North Carolina Industrial Commission ruled that the injuries suffered by Graven and Wall were not compensable under the Workers’ Compensation Act (“Act”). Significantly, a sergeant of the SHP testified that although Graven and Wall rode in a state-owned vehicle, the vehicle was not authorized for use to attend the holiday lunch. He also testified that if the vehicle had been requested for that purpose, the request would have been denied.
Graven and Wall appealed the Commission’s ruling to the North Carolina Court of Appeals.
Injuries Not Compensable
The North Carolina Court of Appeals affirmed the Commission’s decision and that the employees’ injuries were not compensable. Graven, et al. v. N.C. Dept. of Public Safety-Division of Law Enforcement, et al., 762 S.E.2d 230, 2014 N.C. App. LEXIS 811(2014).
North Carolina’s “going and coming” rule provides that “[i]njuries received by an employee while traveling to or from his place of employment are usually not covered by the Act unless the employer furnishes the means of transportation as an incident of the contract of employment” or if the injuries are sustained while the employee is “on the premises owned or controlled by the employer[.]”
In holding that the “going and coming” rule applied to bar the employees’ claims, the Court noted that although the employees were in a state- owned vehicle at the time of the accident, the vehicle “was provided as an accommodation” and that the employees were “not traveling to perform work for their employer”; instead, they were injured “while traveling back” to the workplace. (Emphasis in original.)
The Court also held that an “increased risk” analysis did not apply to allow the employees to receive workers’ compensation benefits because they: (1) voluntarily attended the social event and (2) were injured due to a risk that is common to the public while traveling on a public road.
The Court emphasized six factors that can serve as guideposts to determine whether employee injuries incurred at employer-sponsored recreational and social activities arise out of and in the course of employment. Those factors include:
- whether the employer in fact sponsored the event;
- whether attendance at the event is voluntary;
- whether there is some degree of encouragement of employees to attend the event;
- whether the employer financed the event, and to what degree;
- whether employees regarded the event as an employment benefit to which they were entitled to as of right; and
- whether the employer benefited from the event, not merely in a vague way through better morale and good will, but through such tangible advantages as having the opportunity to make speeches and present awards.
In addition to reviewing the guidance of the North Carolina Court of Appeals, employers can take other precautions to minimize the risk of unintended consequences while celebrating the season with coworkers. When alcohol is served, employers may be the ones with a hangover because of employees’ inappropriate conduct, such as offensive language and unwelcome sexual advances. Among other things, consider reminding employees of substance abuse and sexual harassment policies, providing plenty of food and non-alcoholic beverages, limiting or not providing alcohol, inviting spouses and dates, and designating party managers and monitoring conduct.