Werewolves. Vampires. Ghosts and witches. Of all the scary monsters that populate this time of year, few compare to the horrors that can happen at an office Halloween party if you're not careful. Business owner, beware: before you throw your annual costume contest or employee mixer, watch out for these three risks that can haunt you long after the festivities are over.
1. Liquor liability when cauldrons (and punch bowls) are spiked.
A little booze gets any party going, but that liquid courage comes at a price. Namely, if you serve alcohol at a work function, you take on the responsibility for your inebriated employees' actions. That means you may be liable for:
- Drunk driving accidents they cause.
- Drunken fights they start.
- All the property damage and medical costs that accompany those incidents.
Most states have liquor liability and social host laws that allow injured third parties to sue the person or entity that served alcohol to the guest or patron that hurt them. Liquor Liability Insurance, which may be included in your business's General Liability Insurance policy, can address the legal expenses and medical costs associated with these claims. However, it won't cover any incidents stemming from serving alcohol to minors, which is illegal in all 50 states.
To reduce the chance of intoxicated guests, be sure to establish expectations before the festivities kick off. Let your staff know that drunk driving will not be tolerated and that they need to arrange a ride before the party begins.
To learn more about Liquor Liability Insurance and how to manage your risks, check out Chapter 4 of our free eBook Liquor Liability Insurance? I’ll Drink to That: A Complete Guide to Serving and Hosting Responsibly. To learn more about your state's liquor liability laws, jump to the map in Chapter 2.
2. Employment practices liability when ghouls letch.
The drinks are flowing, and the creeps start creeping. If your employees direct their unwanted advances at their coworkers and you are notified about the incident, you are required to intervene. If you fail to do so, you can be sued over allowing sexual harassment to happen at your business.
In the wild, sexual harassment may come in the form of:
- Sexually suggestive comments.
- Pressure for sexual favors.
- Inappropriate or unwelcome touching.
- Sexual jokes or degrading images of women or men.
To learn more, read "Employee Rights: What Small-Business Owners Need to Know."
Employment Practices Liability Insurance can address legal expenses over sexual harassment lawsuits, but don't let it get to that point. Inform your staff that company policies still apply at the Halloween office party and that everyone is expected to treat each other with respect.
3. Workers' Comp accidents when the monster mash gets messy.
A scary story: your business can be held responsible for employee injuries that happen at the Halloween party if…
- Attendance is mandatory.
- Attendance can be construed as part of their work responsibilities.
You don't have to explicitly state that attendance is mandatory, either. So long as you get some kind of benefit from employees attending the event and you hold the event at the office, you can be liable for their injuries.
Your Workers' Compensation Insurance may cover employee injuries that happen at a leisurely work event (e.g., your copywriter sprains an ankle while dancing). There's even some legal precedent for the coverage's application in these situations (read "When Team-Building Goes Wrong: How a Kickball Injury Became a Workers' Comp Claim" for more details). However, the claims may be denied if…
- Injuries happened while the employee was intoxicated.
- The employee's injuries happened because they started a fight.
- The employee sustained injuries while violating a company policy.
Though these risks are easy to come by at an office party, you can still cut a rug and have a good time. Just make sure you don't let your guard down entirely. Garlic cloves are optional.