As the holiday season approaches, so do the holiday parties. Some extra planning and precaution is prudent to ensure this year’s holiday party is a safe and enjoyable event for all staff. As such, if alcohol is served at this year’s holiday party, employers should be particularly alert to the risks associated with serving alcohol to employees.

An employee who drives impaired after drinking at a company holiday party poses a risk of foreseeable harm, not only to him/herself, but also to the general public. Except in Quebec, employers may be liable for losses suffered by third parties such as passengers and other road users in the event of a car accident caused by an impaired employee.1 Therefore, if adequate steps are not taken by an employer to ensure employees get home safely, an employer may be liable not only for injuries suffered by an employee who drives home impaired, but also for the injuries suffered by third parties, such as passengers and other road users.

Employers held liable

In the seminal case Jacobsen v Nike Canada Ltd.,2 Jacobsen, an employee of Nike Canada in British Columbia, successfully sued the company for severe injuries he sustained as a result of driving impaired after drinking beer with his supervisor and co-workers while at work. Nike was held liable for a significant portion of the $2.7 million in damages assessed.

In that particular case, Jacobsen’s supervisor supplied a cooler of beer to employees during working hours. The court held that Nike Canada breached its duty of care to Jacobsen by providing alcohol in the workplace, not monitoring its consumption and taking no steps to prevent Jacobsen from driving impaired. The court further held that an employer cannot escape liability merely because the worker shows no visible signs of impairment. While the case involved the provision of alcohol during working hours, the same reasoning applies to a workplace function where alcohol is served to employees.

In a more recent decision, Hunt v Sutton Group Incentive Realty Inc.,3 the employer was held partly liable for over $1 million in damages for injuries sustained in a car accident by an employee who drove home impaired after consuming several drinks at the company’s Christmas party. The court held that the employer did not discharge its duty to ensure the employee got home safely. The decision was later overturned by the Ontario Court of Appeal as a result of the trial judge’s direction to the jury in this case; however, the Court of Appeal did not overturn the court’s reasoning that the employer could be held liable for the injuries sustained by the employee in a motor vehicle accident.

These cases confirm that an employer may face significant costs if protective measures are not put in place to reduce the risks associated with serving alcohol at company events.

In addition, drinking may increase the likelihood of inappropriate or unwelcome behaviour. While a holiday party is a social event, an employee’s right to have a “work environment” free of harassment extends to off-site company sponsored events and may include events not officially sponsored by the company (for example, a manager taking a group of employees out for drinks). An employer may face a human rights or health and safety complaint from an employee who was harassed at a company social event.

Tips for employers

The following precautionary steps may be taken to reduce an employer’s risk of liability:

  • Provide transportation or taxi vouchers to party guests and ensure they are advised of their transportation arrangements well in advance of the party, to ensure employees leave their cars at home;
  • Host events at a hotel or restaurant where a licensed commercial host will be primarily responsible for providing qualified staff to serve and monitor alcohol consumption. Ensure the commercial host has its own liability insurance. Holding a social function at a commercial establishment will not necessarily discharge an employer from its duty of care, but it will enhance control over alcohol consumption and enable an employer to potentially reduce legal liability;
  • Restrict and monitor the amount of alcohol consumed by each guest. For example, use a drink voucher system or hire a licensed bartender rather than offering a self-serve bar, close the bar at least one hour before the planned end-time of the activity and make non-alcoholic refreshments freely available;
  • Assign supervisors and managers to monitor the festivities during the event and enable them to “cut off” alcohol service or require an employee to take a taxi home;
  • Ensure food is also served when alcohol is being served;
  • Encourage employees to drink responsibly and remind them that drinking and driving is illegal;
  • If there is reason to believe an employee intends to drive home impaired, take away the employee’s keys and call him or her a taxi;
  • Arrange for host liability insurance coverage.