Employment Law 101: 'Tis the Season for Holiday Parties and End of Year Bonuses

By John Mavros Attorney at Law, Partner, Fisher & Phillips, LLP | December 20, 2015

Co-authored by Aston Riley, Associate, Fisher & Phillips, LLP

It’s that time of year again—time to don ugly sweaters and drink rum-filled egg nog while socializing with co-workers at the company holiday party. This is also the time for heightened instances of sexual harassment and liability surrounding overtime pay and holiday bonuses. Around this time of joy and cheer, employers face an increased risk for employment law mishaps. This article provides a quick overview along with tips to make it through the season unscathed.

Holiday Parties

Now that it is the end of the year, businesses want to celebrate a productive year and reward those who made it possible, often with a party for everyone to relax, cut loose, and have a good time. As always, throwing a large social event brings with it inherent risks. People can sometimes imbibe too much alcohol, or forget about the company’s code of conduct, which can lead to an awkward conversation the following Monday at best, and a lawsuit and potential catastrophe at worst.

This holiday season, here are some ideas to consider implementing when planning that end of the year bash:

  • “Not-so-Open” Bar - Alcohol consumption is the most common reason for
    holiday party mishaps and an “open bar” invites the opportunity for
    overconsumption and potential headaches not just for the employee who had
    one too many, but for the employer as well. Consider limiting consumption
    by having a limited number of drink tickets or a cash bar.
  • Other Limits on Consumption - Another way to limit consumption is to adjust
    the type of alcohol served and the time for service. For example, consider
    serving beer and wine only and no hard spirits. Also, businesses can limit
    the time that service to only pre-dinner during a “cocktail hour” or only
    hosting a bar for a limited period during the party.
  • Leave it to the Pro’s - Hiring professional bartenders to handle
    distribution of alcohol has its benefits—professionals have experience with
    requiring identification for those that do not look substantially over
    21-years-old as well as knowing when they should or should not serve someone
    that has already had enough to drink. Also, having employees or supervisors
    serving alcohol can impute liability for overserving directly to the
    employer, and so this is a great way to add another layer of protection.
  • Safety, Safety, Safety - Provide a taxi or other alternative driving service
    for people leaving the party. If hosting employees at the home of a
    supervisor or employer, there is potential liability if a party-goer leaves
    the house drunk and gets behind the wheel. If hosting the event at a hotel
    or other venue, offer complimentary or discounted rooms so attendees can
    walk to their bed for the evening. Employers would do well to also provide
    taxi vouchers or make arrangements with a ride-sharing service for
    transportation to and from the party. Also, do not be afraid to ask for
    volunteer designated drivers to help out with safety.
  • Buddy System - Inviting a spouse or partner presents additional
    accountability and can help keep inappropriate behavior to a minimum.
    Spouses and significant others can also potentially provide another sober
    (and hopefully safe) driver at the end of the night.
  • Friendly Reminders - Although businesses want to encourage employees to
    enjoy themselves for a productive year, a friendly reminder that this is not
    a college fraternity party and violations of company policies or standards
    can result in disciplinary action.
  • Sponsor One Event - Avoid any “after-parties,” and supervisors especially
    should not be attending any of these events to avoid any connection of
    impropriety or misbehavior to the business.
  • Consider Alternatives - If businesses want to avoid a lot of the headache or
    hassle of a holiday party, consider an alternative such as donating what
    would be spend on a party to charity, and encourage employees to participate
    in the cause via a toy drive or gifts for families in need. Or consider
    hosting a holiday luncheon at or near the hotel or office to reward
    employees in a fun environment without the risks of alcohol.
  • Party “Appropriately” - It can send the wrong message if the business throws
    an extravagant and costly party followed by a round of layoffs starting
    January 1, or worse, just after a recent round of layoffs when morale may be
    taking a dip. Employees will wonder if the party was worth not having some
    of their co-workers around to enjoy it with.
  • “Working” the Party - As employers know, nonexempt employees must be paid
    for all time spent working, but what they may not know is that required
    attendance at employer-sponsored events may be time that must be
    compensated. Similarly, nonexempt employees that are required to perform
    tasks at the holiday party may need to be paid for time setting up or
    cleaning up at the end of the night. Not only might this time require
    compensation, but if it is work in excess of eight hours in a day or forty
    in a week, it may require overtime premiums. To avoid this concern
    altogether, make attendance of the party optional and hire a third-party or
    let the venue hosting the party perform all the necessary services.

End of Year Bonuses

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