Hosting parties for your employees and their families may be good for morale and engagement, but they are fraught with risks of legal liability for employers. Alcohol use is at the heart of these risks. Too much consumption can lead to physical injuries, whether self-inflicted like falling down stairs, or by the conduct of another like sexual harassment or assault. Other issues that may not have even been contemplated five years ago, such as cannabis consumption, also raise a new category of concerns. However, these risks are not unmanageable. In this article, we will detail some of those risks and offer ideas for how employers can try to mitigate them.

Employers' Legal Obligations

Employers' have obligations in connection with the safety and well-being of their employees in the course of their employment.

Depending on the circumstances, an employee's injury at a party may fall within the scope of a compensable accident under the Workers' Compensation Act of Manitoba. If it does and a claim is accepted, this may have a negative impact on your cost of coverage going forward.

Employers are also prohibited under The Human Rights Code from knowingly permitting, or failing to take reasonable steps to terminate, harassment of one person by another person when they both are participating in a work party for which the employer is responsible. Harassment means, among other things, a series of objectionable and unwelcome sexual solicitations or advances. More broadly, employers have a duty to ensure, so far as is reasonably practicable, the safety, health and welfare at work for all workers under The Workplace Safety and Health Act.

Another liability risk concerns employees who cause injury to non-employees. In the case of a social event, this could be a spouse or other guest of an employee. It may also include staff of another employer working at the event. In some circumstances, employers can be held responsible for the misconduct of their employee and be effectively "on the hook" as if the employer had caused the injury directly to the third party (referred to as vicarious liability). This could arise where an intoxicated employee gets into a fight with the guest of another employee.

If a work-party injury to an employee is not covered by workers compensation or the injury is cause by a non-employee (whether self-inflicted or at the hands of another non-employee at the party), social host liability may apply, particularly if an employer is the holder of a social occasion liquor permit.

Lastly, under the Cannabis Act, it is a crime for an organization to possess cannabis and punishment is in the form of a fine up to $100,000. While this might seem obvious to some, it clearly means that cannabis should absolutely not be served at work-related functions.

Party Pooper: Reducing the Risks

This likely does not constitute a "hot take", but we think alcohol and recreational cannabis use is the main driver behind the heightened risks of legal liability addressed above.

Every employer will vary when it comes to risk tolerance for legal liability. The most risk-averse employer may wish to cut alcohol altogether and instead hold a different kind of event to achieve the same goals as the party would have (i.e. team building, employee appreciation etc.). Considering that, apparently, each new generation seems to be consuming less alcohol than the generation prior, this may be an option that won't cause too much discontent among staff, depending on its demographics. This other kind of event could still be a "party", just without booze. But other options could include daytime events that offer team building and recognition of staff success, but in a setting where most wouldn't expect to be served alcohol.

But if alcohol is on the menu, consider some of these ideas for risk mitigation:

  • Have and enforce a drink limit policy
  • Limit times during which alcohol is served
  • Arrange for rides home at no extra cost to the employee and guests
  • Offer non-alcoholic drink options
  • Avoid promoting the event with a focus / emphasis on alcohol consumption
  • Ensure those serving alcohol are trained and directed to monitor for overconsumption
  • Clearly communicate to employees that recreational cannabis is not permitted at the event
  • Ensure those monitoring for alcohol overconsumption are also trained in monitoring for signs of cannabis use – i.e. bloodshot eyes, increased appetite, slowed reaction time, impaired coordination, and drowsiness (or designate another monitor who can do so)

Risk mitigation goes beyond taking steps to limit the amount of alcohol consumed and hoping nobody chooses to bring their own recreational products. In addition to those options, making sure you have an updated and widely known/distributed harassment prevention policy is important so that if anyone believes they've been harassed, there's a method to bring the incident to your attention. At the end of the day, employers need to know if these incidents have occurred so that they can be responsive to them. Failing to act means major risks of breaching The Human Rights Code for a failure to take reasonable steps to terminate harassment.

As an employer in control of the workplace, you have the inherent right to set workplace rules and policies. This authority does not vanish when hosting a work party. The rules and expectations you have for your guests should be clearly communicated and enforced if breached. A policy prohibiting cannabis use at work events could go a long way in preventing unauthorized consumption – which is often hard to observe, based on the discrete nature of edible cannabis products. Further, if the decision is made that no alcohol or substances of any kind are to be consumed at the event and an employee does so, disciplinary action should be taken, regardless of whether there was a consequence of the breach or not.

It is also useful to remind employees of the expectations of the employer (including drug and alcohol and behavioural policies), as well as educate employees on the risks associated with over consuming alcohol, and mixing alcohol and cannabis products.

At the end of the day, holiday parties can be a great way to bring your employees together in a fun and relaxed environment. As much as you may want to encourage a good time, remember that too much of a good thing cannot only be harmful, but it might turn into a liability.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.