Thirty-six percent of employers report employee misconduct at holiday parties. This misconduct includes excessive drinking, sexual advances, off-color jokes, vulgar language and gestures, arguments and even fistfights.

Employers may be liable for the acts of their supervisors and employees under numerous legal theories. For example, employers may be civilly liable for negligent or intentional acts occurring within the "scope of employment." Employers also may be liable for harassment, discrimination or retaliation in violation of Title VII.

Individual employees also can be civilly or criminally liable for their own acts. Apart from being embarrassing, liability to the employer and to individuals can be substantial. Employers should take these risks seriously and consider taking the following precautions to reduce their potential risks.

Preparty necessities

Prior to the party, employers should:

  1. review policies prohibiting drug and alcohol abuse, harassment, dating, fighting, weapons and other misconduct
  2. train supervisors and employees about the no-harassment, no-retaliation and EEO policies and the procedures for reporting and responding to harassment, discrimination or retaliation claims and document that this training has occurred
  3. make sure they have consistently disciplined violators of policies
  4. foster a work environment free of harassment, discrimination or retaliation
  5. consider whether a private binding arbitration program for resolving employee claims is right for the organization

Party planning

Most holiday party misconduct is related to overconsumption of alcohol. If you choose to serve alcohol at a party, consider these tips:

  1. remind employees that normal rules of conduct apply to parties and to drink responsibly
  2. arrange for designated drivers, reduced cab fares or hotel room rates or even offer to pay or reimburse alcohol-impaired employees for cab fare or hotel expenses
  3. tell employees attendance is not required
  4. provide employees with a limited number of drink tickets
  5. limit the length of the party and close the bar one hour before the end of the party
  6. serve plenty of nonalcoholic beverages
  7. do not serve punch or other concoctions that mask alcoholic content
  8. provide food and entertainment to prevent drinking from being the focus of the party
  9. serve foods that slow the assimilation of alcohol (i.e., those high in protein or starch) and not greasy or salty foods that encourage more consumption of liquids
  10. have the party off-site at a professionally managed facility with bartenders who are trained to limit harm or liability
  11. don't allow employees to tend bar or provide alcohol
  12. designate a responsible person to "monitor" the party and work with the event staff
  13. schedule the party on a weeknight when employees are less likely to overindulge
  14. hire an off-duty policeman or security specialist to be present during and after the party
  15. don't hang mistletoe
  16. make sure underage employees or guests are not served alcohol
  17. consider buying a special insurance policy for the event that includes liability for alcohol-related misconduct
  18. review your existing insurance policies for alcohol-related exclusions

Employers cannot completely eliminate the risk of liability arising from parties, but they can significantly reduce the potential for liability with some advance planning. So be cautious and let the good times roll.