Company parties are a time to wind down and mingle with bosses and coworkers in a less formal setting. In general, they're a great way to boost employees' morale. In some cases, alcohol is served at such parties as a way to further improve relationships.
According to a recent California Court of Appeals decision, however, serving alcohol at a company party places a certain amount of liability upon the company, a liability that could come into play if any employees are injured during or after the party. It's an issue of premises liability that many readers may not be familiar with.
Premises liability is the idea that the owners of a dangerous premises are in some ways responsible for the safety of the premises' occupants. If the premises owners create a situation that carries a risk of harm to others, they could be found partially liable for any accidents.
In the Court of Appeals case, a California hotel threw a party for its employees. The hotel administrators set a two drink limit on each partygoer, but the limit was not well enforced. One employee smuggled a flask of whiskey into the party and became drunk. The bartender on duty over-served the employee, and no one made an effort to stop him from leaving. Later that night, the employee was in a drunk driving accident that killed an innocent driver.
The Court of Appeals found that the hotel was partially liable for the driver's death, because they created the dangerous situation that led to the drunk driving incident. If the hotel had closely adhered to its two drink policy, the court said, the man never would have become intoxicated and the fatal accident never would have occurred.
Of course, the incident does not need to result from drunk driving. Alcohol can lead to any number of injuries on company premises, from slip and fall incidents on wet floors to violence between intoxicated employees. A company could potentially be found liable in any of these situations, resulting in heavy compensation for the injured party.
Source: The Bakersfield Californian, "ROBIN PAGGI: Rethink serving alcohol at company events" Robin Paggi, Sep. 10, 2013