It happens every holiday season. An employee has a few too many drinks at a company party and says something inappropriate, gets into an altercation, or worse, gets into an accident on the way home and injures or kills someone. Now the company is forced into damage control, facing an investigation, a costly lawsuit, and a big black eye on its reputation – and that’s just for starters.
It’s one of the biggest risks you face all year – and one of the most avoidable.
The office holiday party is a great opportunity for socializing away from work, and a way for employers to say “thanks” to their employees for their efforts throughout the year. But if you’re not treating your holiday party as a serious risk management responsibility, you’re asking for trouble. Consider the potential risks:
- Liquor law liabilities
- Sexual harassment and assault
- Violence against a manager or coworker
- Slips and falls or other injuries
- Food poisoning
- Premises damage
- Reputational damage
Follow these seven holiday party risk management tips to keep your party safe, happy, and disaster-free:
1. Set firm boundaries for conduct. Make sure everyone understands company policies on acceptable behavior, the potential liabilities, and the consequences of noncompliance. Remind them that it’s still a work-related event, and sexual harassment or other inappropriate behavior won’t be tolerated. Rules should apply whether the guest list includes spouses and children, clients and vendors, or staff only. If you plan to serve alcohol, remind everyone about responsible drinking.
2. Control your liquor law liabilities. This is easily your biggest risk when it comes to your holiday party. If someone is served alcohol at your party and ends up getting injured – or worse, injures someone else – in a motor vehicle accident or altercation, you could find yourself on the hook for medical bills, vehicle repairs, a wrongful death lawsuit, and a host of other liabilities. Don’t have an open bar, don’t pay for drinks, consider a drink voucher system, hire a professional bartender, offer non-alcoholic drinks, stop serving liquor before the end of the party, and arrange alternate transportation for those who need it.
3. Hold the festivities offsite. If something should happen, it’s better for it to happen somewhere other than your business location. You could still be named as a defendant in a civil lawsuit, but some of the liability will likely be shared by the venue.
4. Identify and eliminate safety hazards. Make sure all areas indoors and out are free from slip and fall hazards such as ice, snow, standing water, obstructions, etc. Even one injury claim can be a financial drain.
5. Know your caterer. Foodborne illnesses are becoming a more common threat all the time, and party buffets are a perfect breeding ground for contamination. If your food will be catered, hire a reputable firm that is knowledgeable in food handling safety standards.
6. Investigate incidents immediately. If an incident happens, gather and thoroughly document the facts and circumstances promptly while the incident is still fresh in everyone’s mind.
7. Make sure you’re covered just in case. Check to see if your liquor liability is covered under your CGL policy, and consider coverage such as Employment Practices Liability Insurance (EPLI) to protect against claims of discrimination, sexual harassment, emotional distress, and other issues.
Company holiday parties are a time for celebration, but they can also be prime time for embarrassing moments and costly liabilities. Put your holiday party on your risk management to-do list, and contact the risk management experts at Heffernan Insurance Brokers to learn more about keeping your business safe all year round.