Employer’s Liability for Holiday Parties

‘Tis the season for human resources professionals to fret over an employer’s liability for alcohol-related mishaps stemming from too much holiday cheer at the office party. Before you say "bah humbug" to the whole idea, you might want to weigh your return on investment from a year end boost in employee morale versus the specter of alcohol induced accident or incident.

Mixing alcohol and employees can result in a wide spectrum of possible outcomes ranging from mildly embarrassing to catastrophic. Like all good lawyers, we’ll focus on the catastrophic: the automobile accident and the discrimination lawsuit.

In Pennsylvania, there is little difference in liability between an employer/host and the social host of a private party in a home. Whether the party is thrown by an employer or an individual, there is generally no liability for an adult host when an adult employee, guest or someone else is injured by an adult drunk driver who may have been served at the party. Courts reason that "it is the consumption of alcohol rather than the furnishing thereof, that is the proximate cause of any subsequent damage". However, there is liability for any host (whether an employer or a private person) who knowingly serves alcohol to anyone under age 21.

Employer’s may also face claims from employees injured by the consumption of alcohol under employee benefit programs like workers’ compensation insurance, medical and accident policies. Employee benefit plan and insurance exclusion for injuries arising from operating a vehicle while intoxicated are generally upheld. 

Work parties are generally considered as arising out of or in the course of an employee’s job, even if attendance is not mandatory. Although workers’ compensation law bars recovery for injuries or death caused by violation of law (i.e. driving under the influence), it also requires that the intoxication be the proximate cause of the accident causing the injury. In some cases, employees have recovered worker’s compensation benefits because the employer could not prove that the accident would not have happened unless the employee was intoxicated.

Employers may also spend their post-holiday hours sorting out employee disciplinary actions which sometimes ferment into claims of sexual harassment and disability discrimination. Alcohol consumption has been known to cloud judgment and blur the clear line between welcome and unwelcome conduct. Alcohol related misconduct can also bring to light an employee’s alcoholism. Although alcoholism is a "disability" under discrimination laws, it does not insulate an employee from discipline or discharge for the conduct arising from his or her impairment.

Managing alcohol consumption at employer events can mitigate liability and reduce the risk of accidents. The following is a partial list of ideas to incorporate into your next office party:

• Circulate to employees a kindly worded reminder about drinking and driving and the consumption of alcohol by employees under the age of 21.
• Consider engaging professional bartenders if they are not already part of your event.
• Give bartenders rules on serving minors and intoxicated employees.
• Avoid self-serve alcohol or long periods of "open bar."
• Don’t allow drinking to become the focus of the event.
• Don’t allow individuals to be pressured into drinking.
• Monitor conduct and don’t be afraid to intervene if conduct or alcohol consumption become inappropriate.
• Have a designated driver or call a cab for someone who shouldn’t be driving.

Wishing you a safe and happy holiday season!