Reminder to HR: Holiday parties are lawsuits waiting to happen

It's the season for company holiday parties — and potential legal nightmares that can turn a festive celebration into an HR headache. 

Executive coaching firm Challenger, Gray and Christmas found that 57% of companies planned on having in-person holiday parties last year. As more companies push for in-person engagement and bonding, that number will likely grow. Yet the opportunity to let loose means a greater risk of behavior like harassment and discrimination, notes Michael Schmidt, a labor and employment attorney at Cozen O'Connor.  

"Holiday parties tend to be offsite, outside work hours, there's serving of alcohol — it's more of an informal and celebratory mood," he says. "It's easy to get into a mindset where people think the rules of workplace conduct no longer apply."

Read more: How to plan an alcohol-free company holiday party

Schmidt underlines that the same rules set by employers, from anti-harassment and anti-retaliation policies to dress codes, do apply to a work-sponsored party, regardless of location or time. For example, if someone arrives to a party in a costume one group may deem offensive, there would be just cause to bring the issue up to HR. The same logic follows if someone said something offensive or made another employee feel uncomfortable because they had one too many drinks. Schmidt reminds HR teams that parties can't excuse inappropriate behavior, and it's legally dangerous to assume otherwise.

"The biggest mistake is not taking complaints that occur as a result of holiday parties seriously because the informal setting makes it feel like the rules didn't apply," says Schmidt. "Or maintaining a culture where it's not understood that the rules regarding appropriate workplace conduct still apply." 

Employers can also be held liable for accidents or physical injuries that occur during the event, as well as to and from the event. Schmidt advises employers to at least pay for the employee's transportation back home. He notes that employers should also make a more conscious decision about whether they should serve alcohol, and if so, how many drink tickets each employee should get. If it's an open bar, the employer may consider closing it an hour or two before the end of the party.

Read more: Why holiday stress doesn't need to derail productivity

Other good practices include keeping party attendance voluntary — employer liability can be compounded if they require attendance — as well as offering food, stocking the bar with a plethora of non-alcoholic beverages and organizing activities like a game of trivia or an end-of-the-year awards ceremony. Schmidt encourages HR teams to recirculate their workplace policies to employees before the event, touching on topics like misconduct, social media and substance abuse. 

Ultimately, a holiday party should be an opportunity for employees to connect with colleagues they wouldn't otherwise interact with, and raise employee morale. And holiday parties can do just that if they are planned thoughtfully and treated like the workplace events that they are, emphasizes Schmidt. 

Read more: How to keep your office holiday celebrations inclusive 

"It's not about creating new rules as much as it is reminding everybody that they are all expected to abide by normal workplace policies," he says. "HR teams and employees generally just need to give some thought to what dynamics and logistics of the party will be most appropriate for their company and their workforce."