Ask the Expert Series: Five answers to holiday party HR questions, featuring Bent Ericksen & Associates

Nov. 19, 2009

Question 1: My dental practice would like to have a holiday party for our staff to show our appreciation of their hard work throughout the year. Is it OK to serve alcohol? How should we handle potential risks with intoxicated employees?

Answer: Excellent question! While office parties can bolster morale, enhance work relationships, and promote cooperation at all levels of the practice, parties also carry significant risk, which is why office parties are becoming less common. Serving alcohol is your prerogative. Many employers, however, are now choosing to eliminate alcoholic beverages to prevent being held liable for any harm caused by an employee who becomes intoxicated during the festivities. If you choose to serve alcohol, consider the following tips:

* Remind employees of their responsibilities under the office alcohol and substance abuse policy that extends to office-sponsored off-site events.
* Establish consumption limits and strictly enforce them. To this end, it is helpful to hire professional bartenders for any employer-sponsored parties.
* Do not allow intoxicated employees to drive. Choose someone to act as the designated driver or offer to pay the taxi fare for employees who have been drinking and should not drive.
* Have information regarding cab services, train, or other convenient public transportation handy.
* If a function is held at a hotel, reserve a few rooms for intoxicated employees who might need them.

Question 2: As a multicultural office, we find it difficult to celebrate the holidays. We want to have an event in which we can all get together and celebrate, but we don’t want to be disrespectful to any employee’s beliefs. What’s the best way to handle this?

Answer: In our ever-growing diverse nation this is becoming a concern for most employers. The best way to avoid allegations of discrimination is to refrain from using religious descriptions or decorations that represent a particular belief. For example, call the celebration a “holiday party” or “a celebration of seasons” rather than a Christmas party. If your main intention for the party is to reward employees for their hard work throughout the year, you may also want to consider celebrating during a different time of the year. Sponsoring events such as a summer BBQ or a day at an amusement park, for example, are great ways to show employee appreciation while avoiding any religious connotations.

Question 3: Last year we had a party to celebrate the holidays. We invited our staff and their spouses, some referring dentists, and a number of other people with whom we do business. I thought we all had a good time. The next day an employee claimed she had been sexually harassed and she held me responsible. I investigated the allegations and took appropriate action based on my personnel policies. How should I prevent something like this from happening in the future?

Answer: Parties have many positive aspects, but, as you discovered, they also carry significant risks. Start by informing your staff that their attendance is completely voluntary. Thereby, any mishaps that occur during the event cannot be considered as having taken place within the scope of any work assignment. Prior to the party, remind employees about general standards of conduct, including sexual harassment. Encourage appropriate behavior to ensure that everyone has a good time and, for off-site parties, to keep the company’s reputation intact. Finally, one the most effective ways to decrease your potential liability is to not allow alcohol to be served at the party. Alcohol can adversely affect judgment and inhibitions, which can lead to problems.

Question 4: We’re planning our next holiday party. Do we need to pay staff members who are planning and organizing the event if they are coordinating the activities outside of work time? What about during the function, at which time they will also be enjoying the festivities?

Answer: Staff is often intimately involved in party planning. Some of the items that may have to be addressed are location, reservations, budgeting, food, entertainment, and refreshments. If staff participates either in planning the party or acting as helper/hosts during the party outside normal work hours, that time is considered paid time. Even if staff is willing to do so voluntarily, the labor department considers their time to be work-related and therefore paid time. However, since staff is not performing their normal work duties, the time may be paid at a “different capacity” rate. The rate must be no less than minimum wage.

Question 5: In order to increase the sense of team in my office, I sponsor outside activities. As a group we’ve gone on ski trips, had picnics, attended plays, played softball, and had annual holiday parties. My liability insurance carrier recently informed me that such activities can carry significant liability risk. Can you explain what my insurance carrier is worried about?

Answer: The key word here is “sponsor.” If an employee gets hurt, either while traveling or during an event, the injury is likely to be considered work-related and reported as such to your workers’ comp carrier. Here are some examples:
* If alcohol is consumed during an event, and alcohol is ruled to be the cause of an accident, it is likely that the employer will be held solely responsible.
* If an employee who had been drinking falls and twists his/her foot on the way to the restroom and cannot work for four weeks, the employer may be forced to bear the cost of medical treatment, plus salary for the time lost.
* If an employee is involved in a car accident on the way home from a company-sponsored event and is severely injured and totally disabled, the workers’ comp carrier could be paying for a lifetime of total disability, which would significantly affect your insurance premiums.

As you can see, an employer may be held liable for any accidents or injuries resulting from such events. Therefore, it is easy to understand your carrier’s concern. There are many ways to minimize your risk. These include eliminating alcohol, and informing employees that attendance is completely voluntary and free from any express or implied pressure from management.

Do you have a question pertaining to HR issues? If so, CLICK HERE to submit your question for Bent Ericksen & Associates.

For more than 25 years, Bent Ericksen & Associates has been a leading authority in human resources and personnel issues, helping dentists successfully deal with the ever-changing and complex labor laws. To receive a complimentary copy of the company’s quarterly newsletter or to learn more, contact them at (800) 679-2760 or