By: Maryjo F. Pirages Reynolds

Employer-sponsored events, including but not limited to holiday parties, generate liability risks for employers. Often alcohol is served at such events and employers will likely be exposed to liability for the actions of employees during or after such events. In general, under the Illinois Dramshop Act, employers are classified as social hosts and are not liable for alcohol-related injuries which may occur during or after employer-sponsored gatherings at which alcohol is served. However, there are exceptions to this general rule, including an exception in which an employer may be liable for an employee’s negligence if said negligence is determined to have occurred within the scope of employment.

As such, employers should proactively advertise holiday parties as voluntary events to circumvent an argument that such an event occurred within the “scope of employment”. Employers should also ensure that alcohol is not being served to minors, as employer liability may separately arise under the Drug or Alcohol Impaired Minor Responsibility Act. Additionally, employers should confirm that a party venue has Dramshop insurance and should try to avoid serving alcohol on-site in order to limit liability. Other common sense precautions should be considered, such as offering employees alternative transportation, limiting drink options, and providing ample food.  

Further, sexual harassment liability may arise at an employer-sponsored holiday party. Importantly, sexual harassment laws apply to all Illinois employers regardless of size and unwelcome action may include that which occurs off-duty. A holiday party would likely be considered an extension of the employer’s workplace. As such, employers should confirm that their sexual harassment policies address employer-sponsored functions. Employers have a duty to prevent harassment and should also consider republishing their sexual harassment policies before holiday parties, reminding supervisors to set an example during such parties, monitoring alcohol consumption at any party, and emailing employees regarding expectations.

In celebrating the holidays, employers must also be sensitive to the religious and cultural differences of their employees. 

Overall, employers should be proactive in order to minimize the liability risks which arise from company holiday parties. Common-sense actions can promote employee safety and ensure that the holidays remain “the most wonderful time of the year”.