Happy Holidays, everybody!
As we are all aware, holiday parties are an excellent way for employers to boost employee morale, build camaraderie, and celebrate a successful year of business. At the same time, however, employers should be cautious about the pitfalls that throwing a holiday party can bring.
Employers should take caution when serving alcohol at a company-sponsored holiday party. First and foremost, employers should make sure that somebody is checking the ID’s of anybody who consumes alcohol. The purpose of checking ID’s is to avoid serving alcohol to a minor.
Second, employers should also make sure that any individual who is visibly intoxicated is not served any more alcohol. The purpose of this is to avoid “dramshop” type liability for anybody who drinks at a company-sponsored party and then attempts to drive afterward. It is also a good idea to provide several non-alcoholic drink options, so guests don’t feel like alcoholic drinks are their only option. Some employers also limit the amount of drinks their employees can consume by the use of drink coupons.
Third, employers should also provide guests with alternative forms of transportation if they are unable to drive, such as cab rides or designated drivers.
Fourth, in order to avoid some of the problems mentioned above, employers should remind employees (and their guests) to drink responsibly.
Finally, employers should also review their insurance policies to determine if they can serve alcohol at a company-sponsored party in the first place.
Oftentimes, when employees attend company-sponsored parties, they forget they are still in a work-related setting. Once you add some alcohol into the mix, there is a potential that employees may engage in conduct that would violate a company’s anti-sexual harassment policy. Therefore, employers should make sure to remind employees that the party is work-related, and that all workplace rules still apply at the party.
For example, while it may be festive to have somebody dressed in a Santa Claus suit during the event, employees should not be “sitting on Santa’s lap” because such behavior could be deemed inappropriate under Hawaii and Federal sexual harassment laws. As another example, employees should be reminded to dress appropriately, so that they don’t dress in a manner that could be deemed inappropriate for a work-related event.
Finally, employers are warned to NOT hang a mistletoe at the party. See, Exhibit A:
Employees should be reminded that the holiday parties are completely voluntary, and therefore, they are not required to attend the event. (You don’t want to be hit with a workers’ comp or wage and hour claim, right?)
Raffles and Prizes
Raffle drawings are also fun way to spruce up a holiday party (as long as the company is giving away good prizes!), but employers should be aware that most state laws consider raffles to be a form of gambling. One common loophole to such gambling laws, however, is to allow employees to participate in the raffle for free. As a practical matter, offering the opportunity to enter the raffle for free might help a company avoid violating gambling laws, and most employees won’t actually request a free raffle ticket anyway (unless they happen to be named “Scrooge”).
Speaking of prizes…employers are also advised to make sure that any gifts they provide to employees are compliant with IRS rules. Generally speaking, any prizes given to employees should have a “de minimus” value; otherwise, it must be taxed.
Date of Party
Finally, employers should weigh the pros and cons of having a holiday party on a weekday versus the weekend. If the party is on a weekday, the employees might not drink as much alcohol or get too rowdy, which alleviates some of the concerns above. On the other hand, if employees do drink too much alcohol or stay up late, they might be unproductive at work the next day. If the party is on a weekend, employers do not have to worry about employees’ loss of productivity on the day after the party, but there is a high likelihood the employees will consume more alcohol than they would on a weekday.