It’s the season for celebrations, and many businesses throw a Christmas party at the end of the year. These gatherings allow employees to enjoy food, drinks, and games as they unwind from a busy year. However, as a business owner, it’s essential to consider the potential risks associated with these events. While holiday parties can benefit company culture, they can also lead to insurance claims and lawsuits.
At Swarts, Manning & Associates, we help clients minimize risks so they can enjoy their events without worry. Here are five key areas to watch, along with our recommendations to reduce potential liabilities:
5 Ways to Minimize Risk at a Holiday Party
- Alcohol
- It’s common for employees to celebrate to the point of intoxication, which can lead to a variety of issues, such as harassment incidents, injuries, or falls during office games. Since your business is providing the alcohol, you may face risks like harassment claims or workers’ compensation issues.
Manage the Risk:
Most Commercial General Liability (CGL) policies include liquor liability coverage. Check to ensure your policy doesn’t exclude it; if it does, consider adding coverage. Reduce risk further by providing drink tickets and controlled pours.
- Attendance
Requiring attendance without compensation can expose you to Wage-An-Hour claims. Even if attendance is optional, employees may feel pressured to attend, citing office politics.
Manage the Risk:
Host the event during company time if possible. If held after hours, make sure communication is clear on attendance expectations for exempt and non-exempt employees.
- Accommodations
Consider dietary restrictions and allergies when planning. Additionally, businesses can be held responsible if employees drive under the influence after the event.
Manage the Risk:
Arrange transportation options for employees. Designate executives to monitor guests’ sobriety and offer rides if needed. For larger events, consider providing free Uber or Lyft rides to show intent to prioritize employees’ safety.
- Religious Sensitivity
Your employees may come from diverse backgrounds, so be mindful of religious considerations when selecting the event location, time, and food. Using “Christmas Party” as the event name may be inappropriate for non-Christian employees.
Manage the Risk:
Get to know your team’s beliefs, and adjust plans accordingly to respect religious differences. Consider renaming the event as a “Holiday Party” or “End of Year Celebration.”
- Communications
Preventive measures are only effective if employees are aware of them. Clear and frequent communication about the party’s guidelines is crucial.
Transfer the Risk:
Reinforce your company’s code of conduct and drinking policies before the event. Ensure Employment Practices Liability Insurance (EPLI) is in place to protect against claims related to harassment, wage issues, and discrimination. Active Shooter Insurance coverage may also be worth considering, given recent trends.
Questions?
For more guidance on your company’s party risks or insurance options, contact us at Swarts, Manning & Associates. Our experts can help keep your business covered and give you peace of mind.
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