Holiday parties can raise legal issues for employers, including liability for serving alcohol, wage-and-hour violations, workers' compensation, and religious discrimination.
Libations = Liability
Holiday frivolity easily can become holiday liability when alcohol is served at a company party. Employers can be held liable if employees are involved in auto accidents after drinking too much at a company function.
Consider serving only non-alcoholic beverages, or give each employee a limited number of tickets to be used for alcoholic beverages. If an employee or guest is inebriated, pay for a cab or arrange another ride home. Enlist the help of company managers to keep an eye on how much employees are drinking.
A party with too much alcohol is also the perfect breeding ground for sexual harassment claims. Redistribute the company's sexual harassment and substance abuse policies to everyone a week or so before the party to remind them that their liability for sexual harassment applies at all times, including during the party.
Party Time Can Be Work Time
If you put on a company holiday luncheon during a work day, you may be liable for meal break penalties if employees are required to attend the party. Employees generally are entitled to a meal break of at least one-half hour where they are free to leave the premises, and if employees are required to attend the lunchtime party and then go straight back to work, they have missed their meal break, even though they were not performing any work and you fed them lunch.
If attendance at the party is purely voluntary, be sure to let employees know this in writing when you invite them to the party. When attendance is voluntary, there are no meal break penalties because employees had the option to leave the premises.
If the party is not during regular working hours, again be sure to let employees know attendance is purely voluntary. If you require non-exempt employees to attend the party then they are “on the clock” and must be paid for their time. If the party is after a work day, this could result in overtime pay obligations as well.
Some employers allow employees who are attending a holiday party on the evening of a work day to go home early, while those who are not attending work their regular schedule. As long as all employees are paid for the number of hours they work that day, this is a legal practice, although it may cause morale issues for those who don't get to leave early.
Injuries
Even though there's no work involved, an employee who gets hurt at the party can file a workers' compensation claim unless you've made it clear that attendance at the event is strictly voluntary.
Religious Beliefs
Before you deck the halls only with boughs of holly, consider your employees' religious beliefs. Instead of limiting decorations to the usual Christmas tree and Santa motif, let employees know they are welcome to bring decorations for their winter holidays as well. Make room for a Hanukkah menorah, the red, green and black candles of the Kwanzaa kinara, and any other winter holiday decorations employees would like to contribute to party decor.
Be sensitive to employees who do not wish to celebrate religious holidays. Equal employment laws require reasonable accommodation of employees' religious beliefs, so an employee who does not wish to attend a holiday party should be excused from taking part in the festivities.
By: HRC/Cal Chamber